Celebrity Endorsement: Diminishing Returns. How to build an iconic brand?

 

In the ‘90s, Sachin Tendulkar, then considered as the “God of cricket,’ revealed to the awe struck kids that ‘Boost is the secret of my energy.’ Kids believed him and took the claim seriously and cajoled their parents into buying the health drink as one of the essential grocery. Such is the power of the celebrity endorsement. It makes a lasting impression on the admiring fans, young or old, and strongly motivates them to emulate their favourite idols.

In 1760s, Josiah Wedgwood, the founder of the Wedgwood brand of pottery and chinaware, used royal endorsements to create an aura around the name of his company’s products that gave the brand a value far beyond the actual attributes of the product itself. In India, the credit for the first celebrity brand endorsement goes to the popular yesteryear’s film actress Ms. Leela Chitnis. In 1941, she endorsed Lux- the soap brand. This opened up a new avenue for the celebrities to endorse brands and earn substantial income, which has now skyrocketed to astronomical levels. In the late 80s the talk show hostess Tabassum (Prestige pressure cooker), and celebrities like Kapil Dev started endorsing brands and their products. These endorsements produced substantial impact on the sales which further encouraged the use of celebrities for brand promotion in India.

Celebrities create an impression that the consumer is getting a high-quality product. It is to be noted that the celebrity endorsement efficacy is sustained by the perceived image and credibility of the celebrity. When the celebrity’s projected image / reputation becomes suspect, the brand(s) endorsed by them quickly lose their brand value. The recent example is Byjus, which has temporarily suspended all promotions featuring a mega-star, whose son was arrested in a drug related case.

 When a celebrity endorses a brand recklessly (a harmful product like panmasala), without bothering about the expected ill effects, the credibility may take a beating. Under pressure, aging Amitab Bachchan was forced to terminate his contract for the panmasala brand Kamla Pasand. Advertising Standards Council of India’s (ASCI) guidelines state that celebrities should not participate in advertisements of products which by law require a health warning in their advertisements or packing. By law, tobacco advertisement is not allowed in India, hence companies resort to surrogate advertisements. The mega star’s explanation for terminating the contract was hilarious. He said that he agreed to become the brand ambassador as he wasn’t aware of the serious health issues associated with the product. Incidentally, the senior Bachchan is also the face of the government’s pulse polio campaign. He and his daughter-in-law, Aishwarya Bachchan Rai promoted pulse polio awareness.

Also, when a celebrity endorses too many brands, the celebrity’s credibility may suffer as the public may feel that the celebrity will blindly endorse anything and everything for money.

In the past, the return on investment on celebrity endorsements would have been phenomenal but it is expected to nosedive in the coming days. In the present era of social media, the prospective customer may not give much importance to the celebrity, who has endorsed the brand, but will carry out a mini research before buying a product. This trend is evident from the kind of response received by the struggling car brands in increasing sales. Few cases are given below:

-          In 2018, Datsun roped in Aamir Khan as the brand ambassador. Sales dropped by 30%

-          Tata Motors associated with Hrithik Roshan to market Tigor, a compact sedan rivalling Maruti Suzuki’s Dzire. Sales actually declined.

-          Renault used Ranbir Kapoor for models like Duster, Kwid and Captur but the celebrity’s endorsement had no impact on the sales.

The reason for the failure of celebrity endorsements in these cases is, the target customer segment is educated compared to other sectors. They had searched for information and feedbacks available on Google / other social media and read automobile related blogs before buying the cars. This trend is catching up with other products also.

Easy availability of all information about a product will eventually make a consumer an ‘informed consumer,’ who is capable of making sensible decisions by gaining an insight about a product prior to its purchase. This insight with the necessary data will enable the consumer to arrive at an evidence based conclusion. It is expected to happen sooner rather than later. Then, any kind of celebrity endorsement will not have any impact and it would be a colossal waste of money, down the drain.

 

When celebrity endorsement becomes ineffective, is there any other way to promote the products, improve sales and create a brand?

Yes, there are some well-known and popular brands, so popular that they don’t need any celebrity endorsements!

They are- Rolls Royce, Lamborgini, Zara, Tupperware, Naturals Ice Cream, Amul- to name a few.

All the above brands consider celebrity endorsement as a waste of money. These brands believe in their products and let the products and services speak for them.  The product quality, reliability, consistency and the ‘word-of-mouth publicity’ attract customers to buy these products. Consumers remain loyal to the brands and they buy because of the quality and the experience they offer. They become the free ‘brand ambassadors’ for the brand and promote the brand through ‘word-of-mouth.’    

Let us study the case of Amul, which is the market leader in almost all the product categories in milk products. The brand is perceived as honest, trustworthy and value for money. Amul regularly features in the list of top 10 most trusted brands in India. The tagline ‘Taste of India’ is an amazing and powerful factor for the brand, in some sense invokes a feeling of nationalism and patriotism. Amul has a simple value proposition- “Great Value for money and great quality.”

 

How to build an iconic brand using only the intrinsic values of the product?

Suggestions given by two respected and successful industrialists are reproduced below: (Source- The Economic Times, Mumbai edition, dated 01 October, 2021).

-          ‘I have always believed that three Ps are core to building an iconic brand- Purpose, Product and Perseverance. Today, customers are not just buying products; they are building preferences for brands by learning about their values and beliefs. Therefore, purpose has become integral to build deeper connect with the masses. To add, a differentiated product portfolio that addresses the changing needs of the ecosystem we exist in, is also critical.’

‘At JK Tyre, our aim is to build futuristic mobility solutions, yet we remain mindful of our carbon footprint and follow sustainable manufacturing practices across all our production facilities. Our customers greatly value our efforts towards bringing eco-friendly and fuel-efficient products. This sets us apart from the rest of the brands and helps build an ever-expanding loyal customer base across 105 countries that we operate in.’

‘Another key aspect is the value you bring to the industry you operate in- through ground-breaking products and technologies that sets quality benchmarks for the world.‘      

(Dr. Raghupati Singhania, Chairman & Managing Director, JK Tyre & Industries)

 

-          ‘A brand becomes iconic over a period of time, so it is obvious that an iconic brand has to stand the test of time. It is only over at least a decade that a brand experiences the highs and the lows, business cycles, technological disruptions, new competition, product substitutes and changing consumer tastes. Those brands that survive all these challenges, who actually solve consumers’ problems, and manage to establish a committed relationship on the back of honesty and transparency, are the ones that eventually become iconic brands.’

‘The biggest challenge for creating an iconic brand (and not just any brand) is to manage the fickle loyalty of consumers. Consumers today are more willing to experiment but are more vocal about their unhappiness with a brand. The ‘cancel culture’ and the ‘call-out culture’ are something iconic brands of the past aren’t familiar with.’

‘To become or remain an iconic brand, one has to solve actual problems of the consumer, do good for the society, leverage technology to not just be present, but to converse, to connect, to sell, and most importantly, to engage- build a community which create conversations for you and advocates your brand.’

            (Nirmal Jain, Founder, IIFL Group)

 

Dr. C K Sreedharan

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