The Hazards of Celebrity Endorsements in the Age of TwitterPublished: February 27, 2013 in Knowledge@Wharton
In retrospect, the Chanel publicity team might admit that a perfume advertisement starring Brad Pitt in the throes of what seems to be an existential crisis is not exactly marketing gold. The commercial, shot in black and white, features Pitt -- bearded and brooding -- alone in a room. "It's not a journey," he intones, eyes downcast. "Every journey ends, but we go on. The world turns, and we turn with it. Plans disappear; dreams take over. But wherever I go, there you are: my luck, my fate, my fortune."
The ad went viral -- but not in the ways Chanel executives might have hoped. Mocked as pretentious and esoteric, the commercial has been skewered by late-night talk show host Conan O'Brien, parodied by Saturday Night Live and made fun of by "basically everyone on the Internet," as The Huffington Post put it.
The ad, though, is just the latest in a string of marketing misfires involving celebrities who were recruited to promote a brand -- sometimes being paid large sums of money to do so -- only to have their efforts scorned on social media, thereby denting the very brand they were supposed to be elevating. Sometimes, it is the fault of a poorly conceived marketing campaign; other times, it is the fault of celebrities undermining their brand's message -- either inadvertently or with bad behavior.
The pace and tenor of social media have made it more difficult for brands to curate their image, and enlisting a celebrity spokesperson adds a significant layer of risk, notes Patti Williams, professor of marketing at Wharton. "Traditionally, a celebrity would agree to be in an advertisement, and that was essentially the extent of the relationship," she says. "Now, celebrities are encouraged to engage with the [firm's] customers in other ways. This could be through the company's own media or through the celebrity's own media, like a Twitter or Facebook [account]. The nature of the celebrity endorsement is a 360 [degree] proposition -- and that's where many of the risks come from."
Take Jessica Simpson's reported $4 million deal to serve as a spokesperson for Weight Watchers. The endorsement became a laughingstock once her surprise second pregnancy -- which was speculated about for weeks on the Internet before she confirmed it via Twitter -- put a crimp in her weight loss plans. "In the past, the downside [of such endorsements] was relatively limited: It might have been a failed ad that a few customers might have mentioned to their friends," notes Williams. "Today, when something goes wrong, it's no longer just a failed ad -- the rejection of the message takes on a life of its own. [The endorsement] can very quickly become an object of mass ridicule. It might not hurt the brand permanently, but it can do short-term damage."
The Power of Celebrity
Celebrity endorsements are a time-honored marketing tool. The theory is that borrowing some of a celebrity's star power will create both an awareness of, and an interest in, a given product. Apparently, the strategy works: A 2011 study published in the Journal of Advertising that looked at athletes' support for brands found that such endorsements produced a 4% growth in revenue (about $10 million a year in added sales of the branded products), and a 0.25% rise in stock returns.
"There are two schools of thought [on choosing the right celebrity for your brand]," says Barbara Kahn, director of the Jay H. Baker Retailing Center at Wharton. "One is that you want to choose a celebrity who evokes positive emotions in your target market. You want someone who has a broad appeal, someone who creates buzz, someone who is likeable. The second is that you want someone who is a good fit or has some expertise with your product. This gives credibility."
To some extent, the rise of the Internet has accentuated the value of celebrity endorsements. As marketers vie for a precious share of consumers' ever-shortening attention span, a big-name spokesperson can help a brand get noticed. "It's hard to get people's attention through all this clutter and noise," Kahn says. "It was hard before, and it is even harder now. Celebrities -- for better or for worse -- do get our attention."
In the social media realm, celebrities have more cachet and influence than brands. On Twitter, for instance, Justin Bieber has 34.5 million followers, and Oprah Winfrey has 16.6 million. Reality TV stars also have impressive numbers: Kim Kardashian has 17.3 million followers, and Nicole "Snooki" Polizzi has 6 million. But brands -- even popular ones that try to project a hip image -- tend to have far fewer followers. Starbucks has 3.4 million Twitter followers, Rolling Stone magazine has 2.3 million and Gap has 177,000.
It's no surprise, then, that advertisers are increasingly leveraging social networking and celebrities to attract consumers. After all, Internet users spend more time on social networks than any other category of websites, according to a report last year by Nielson, the media measurement company. The report found that 20% of people's time on PCs was devoted to social channels, and 30% of their mobile time went to social networks. About 17% of consumers' PC time is spent on Facebook, which remains the most popular web brand and mobile app in the U.S., according to a report by comScore, which does digital business analytics.
Celebrities are valuable to advertisers, but so are celebrities' fans on social media sites, according to a separate study by Nielsen. The study found that 64% of American adults who follow a celebrity online also follow a brand, and that a celebrity follower is four times more likely to follow a brand than the average U.S. adult online. The Nielsen study also found that such fans are also more likely to offer advice and opinions to fellow online consumers.
"A celebrity endorsement is a signal, or a trigger," says Mark Bonchek, founder of Orbit + Co, a social media strategy company based outside Boston, Mass. "People are looking for signals. If they see a celebrity they like [endorsing a product], that sends the signal that the product is a good one. It's part of [consumers'] conversation around a brand or product."
While this kind of customer-to-customer conversation is sought after by companies, it is also a risky proposition when it moves online: What's said during a coffee klatch or over a water cooler chat at the office is quite different from what's said on a social network like Facebook, which is used by one out of every seven people on the planet. Nearly three-quarters of social media users say they use social networks to hear others' experiences with brands, according to Nielson. Of those, about 65% want to learn more about brands' products and services; 53% wish to compliment brands, and 50% want to express concerns or complaints about brands and services.
"Social media allows consumers to have a voice with other consumers -- this can be a positive or a negative," says David Reibstein, professor of marketing at Wharton. "If you've got a good or funny ad, or a really big celebrity, it could have a much broader reach with social media. But there's a down side to it, too. If your ad [makes] a faux pas, or you have a celebrity who is inconsistent or runs counter to your brand, it could get more negative attention.... There's an old saying that there is 'no such thing as bad publicity.' But that's not entirely true. You do want people talking about your brand, but you want [the chatter] to be positive or neutral."
A 24/7 Cycle
The rise of technology and the accelerated pace by which information spreads has made it harder for companies to ensure that the conversation around their brands remains "positive or neutral," however. A celebrity spokesperson creates an extra liability, notes Reibstein. With social media, "the potential public eye is greater," he says. "All it takes is one person to snap a picture of that celebrity [at an inopportune moment], and that exposure becomes part of the 24/7 [news] cycle."
Like the rest of us, celebrities have their frailties and errors in judgment. Unlike the rest of us, however, these errors in judgment are highly scrutinized. When the celebrities in question are also "brand ambassadors," this bad behavior is especially problematic. Michael Phelps, the most decorated Olympian in history, lost Kellogg's as a sponsor after a photograph of him smoking marijuana appeared in News of the World. Tiger Woods lost his deals with Tag Heuer, Gillette, Accenture, Gatorade and a slew of other firms after it was discovered that he had extramarital affairs with at least a dozen women. And most recently, Nike, Oakley and other big-name sponsors dropped South African Olympic sprinter Oscar Pistorius following charges that he shot and killed his girlfriend, Reeva Steenkamp, during a domestic dispute.
And once a celebrity makes the news, "social media feeds off the news cycle," says Jonah Berger, professor of marketing at Wharton and the author of Contagious: The Secret Behind Why Things Catch On. "Everyone wants to know what's new and what's happening. In politics, no gaffe goes unnoticed. And it's the same in advertising."
He notes the long tradition of American A-list celebrities starring in advertisements overseas for products they don't promote at home. In Japan, Natalie Portman has starred in an ad for a hair product, George Clooney has pitched for Honda, and Brad Pitt has done an ad for Softbank. Prior to social media sharing sites like YouTube, such celebrities "didn't think those ads would affect their U.S. brand equity, because no one over here would ever see them," Berger points out. But now, "anyone with an Internet connection can find [them]."
Social media allow celebrities "more rope with which to hang themselves," says Americus Reed, professor of marketing at Wharton. "It has leveled the playing field by which people can spread information -- everyone with a cell phone has the potential to be a journalist. And the story can be sustained and live on for a much longer time."
However, missteps by a celebrity endorser don't necessarily hurt a brand's image in a lasting way, according to Reed, who has done research in the area of "moral decoupling," or how consumers justify supporting a tarnished brand. "The knee-jerk reaction by consumers is not to blame the company for a celebrity's misdeeds. But [the misdeeds] can give quite a short-term dent to the company."
Reed and others say companies should actively prepare for the potential of bad behavior from their selected endorser before it taints their brand. Consider it "an opportunity to get ahead of the story," notes Reed. "It takes more to manage celebrity spokespeople today. It requires the company to be more vigilant about what's going on, because word about crises can spread faster. A lot of companies have 'social media control rooms' where they monitor the blogosphere and can intervene before something blows up. They can head off problems before they go viral."
Another challenge of celebrity endorsements in the age of social media is the difficulty of crafting a perfect marketing message. Off notes are harder to overcome when "there's a constant 'second screen,'" says Erik Qualman, professor of digital marketing for Hult International Business School. "There's always commentary around the ads themselves [via Facebook, Twitter and other channels]. As a brand, you're trying to make sense of the chatter. A lot of companies are now posting their Super Bowl commercials a few days before the game on YouTube. From there, they're able to see which ones get the best response. It's a smart move."
If the Chanel marketing team had tested the waters this way, perhaps mainstream and social media would not have been given the opportunity to mock the Pitt ad so viciously. In the past, the privately held company had had success leveraging nontraditional media with various Chanel No 5"films" -- lush, minutes-long commercials starring the likes of Nicole Kidman and Audrey Tautou. The fact that the ads were so well received may be what leads to the mass rejection of the Pitt ad, says Wharton's Williams. "The misfire ended up being amplified in social media, I think, ironically because Chanel had previously done such a great job with social media. Their success and social media currency made them even more vulnerable to a failure."
Clint Eastwood's rambling performance during last year's Republican National Convention is a similar case, she notes. During his speech, Eastwood spent much of the time talking to an empty chair that was supposed to be President Barack Obama. "In the past, the next day's newspapers would have commented on it, and pundits might have complained. Saturday Night Live might have spoofed it. But in social media, it became a meme that took on a life of its own," Williams says. "How fast did someone set up a Twitter account [called] 'Invisible Obama'? Social media makes this stuff ignite."