The Highs (And Lows) of Celebrity Endorsement

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Shaun Rein writes in Forbes (h/t Imagethief) about the sorry state of the Phelps affair – he of the many Beijing Olympic gold medals, and many subsequent advertising deals…which have gone sour after a widely-publicized drug scandal:

    “…Kellogg quickly dropped Phelps, and Wrigley has suspended all ad campaigns with Brown, having expected the R&B singer to chew Doublemint, not his girlfriend Rihanna, as rumors say he did. Those embarrassments hurt in the U.S., but they’re even worse in China.

    The pitfalls of celebrity marketing become apparent anywhere very quickly. In today’s borderless world of the Internet and YouTube, any celebrity misstep is captured for posterity, and any brand that is truly global needs to think globally about this problem. Consumers outside of the U.S. are often far less forgiving of poor behavior. At a time when consumers are cutting back and brands need to stretch their marketing dollars farther than ever, the risks in celebrities may mean that marketing money should be spent elsewhere.

    The Michael Phelps pot fiasco may blow over in the U.S., where attitudes about marijuana are comparatively relaxed, and where we now have a president who admits to having used cocaine. But brands like Omega and Visa that support Phelps are finding their image in China truly damaged, because attitudes towards drug use are much more conservative there than in the U.S. As one 34-year-old Beijing woman said, “I’ve lost all respect for Phelps, even though he’s a great athlete.”

    …In China Christian Dior (other-otc: CHDRF.PK – news – people ) got hit harder than any of Phelps’ brands when its celebrity endorser, Sharon Stone, made cruel remarks about the millions of victims of the Sichuan earthquake last year, saying they deserved what they got because of China’s treatment of the Dalai Lama. Her remarks sparked immediate protests, and Dior suffered a major setback in one of the world’s strongest-growing cosmetics markets.

    …Tiger [Wood]’s endorsement of Buick doesn’t work in China, because Chinese consumers have trouble believing that he would ever really drive such a car. I’ve heard consumers say they picture him behind the wheel of a Bentley or a BMW, but certainly not a Buick. It’s too downscale.

    …Liu Xiang, China’s star hurdler, is perhaps the country’s most visible celebrity, and brands such as Nike, Visa, Cadillac and the Chinese milk producer Yili have jumped at the chance to have him endorse their products. But for all his star power, does his endorsement work? My firm, the China Market Research Group, conducted interviews with several hundred consumers in six cities and found that Chinese consumers were confused about what brands Liu Xiang actually represented.

As we have mentioned before, Chinese consumers can be angry and reactionary (add a dose of economic nationalism, and it can get even worse), as Dell and Dior have already discovered. And an apology, after the smoke has blown away, is not worth much.

Foreign brands (yes, even the big ones) are well advised to do some objective research, and take specialist advice, when developing promotional strategy in China – especially if planning to hook a brand on the back of a celebrity who has the audacity to have a private life / secrets / other interests / no real love of the product / etc.

And what about Chinese brands going in the other direction? Tom Doctoroff (of “Billions” fame) explores this at the Huffington Post – and suggests that the issues facing them are also many and complex:

    “Chinese companies will expand foreign presence in one of three ways: a) further exploiting “narrow” markets in which “Chineseness” is an advantage rather than a perceptual weakness (e.g., alternative medicine, niche fashion brands in which “Oriental style” carries cachet), b) forging production alliances with multinational corporations to provide either components or products that compete at lower price tiers but under non-Chinese brand names, c) acquiring international brands and allowing Western management to continue managing them (a la Lenovo, a highly risky strategy, or the aborted Maytag acquisition)”

And not a celebrity in sight. Very wise!

One Response to “The Highs (And Lows) of Celebrity Endorsement”

  1. Archive » Briefly…Food Safety, Online Politics, Economic Issues & Impact, Labour Law, Fraud & Corruption| China Business Blog Says:

    […] We wrote about the risk of celebrity endorsements last week. This post outlines a fake endorsement that has caused much laughter – but which […]

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