Insights To endorse or not to endorse? Effectively managing the risks and rewards of celebrity endorsements

Celebrity endorsements boost the profile and value of brands – their faces launch a thousand sales.

So valued is an endorsement that we hear almost daily of the latest celebrity whose image has been used by scammers to exploit the public: Kate Middleton for a non-existent face cream, Martin Lewis for cryptocurrency. Advances in technology mean that, alarmingly, videos can be produced appearing to show a celebrity giving their endorsement. Recently a deepfake of an interview with Elon Musk, in which he appeared to endorse a cryptocurrency, led to members of the public losing money.

The government is taking action to address some of these problems before the public becomes so distrusting of endorsements, particularly online, that they aren’t worth the investment. Thankfully, we’re not there yet but these episodes are cautionary reminders that celebrity endorsements are a notoriously tricky area, requiring careful management of risk and relationships. Get it wrong and brands can struggle to recover.

Maintaining flexibility

It’s critical to ensure a celebrity endorsement deal is on favourable terms.

The ability to easily and effectively cut ties if things go wrong is essential. But termination might not always be the answer. There may be room for creative and flexible drafting to allow you to respond dynamically to the circumstances.

Take Johnny Depp: after he lost his libel claim against The Sun in the UK, it looked impossible for him to reclaim his commercial value. Fast forward 18 months and an online petition calling for Depp to reprise his role in the Pirates of the Caribbean franchise has 800,000 signatures.

The public’s mind is fickle, celebrities’ stock goes up and down, so brands might want to think twice before severing ties completely even when all seems lost. Sometimes all that’s needed is the right tools to weather the storm which could be achieved simply by a right to put a partnership on hold.

Marking your territory

Care at the contracting stage is also important to ensure the agreed scope of rights is clear.

Talent should give assurances that no competing or overlapping rights have been granted and that they will take steps to ensure their images are not misused.

If a brand perceives talent is working with another offering in their sector, they’re unlikely to attack the celebrity but the brand that has encroached into their territory.

Protecting your reputation

Control over how the celebrity communicates their support is also increasingly key.

In June 2022, former football star Michael Owen deleted a tweet about NFTs that he was endorsing after he was contacted by the Advertising Standards Authority.

If a partner breaches regulations, or infringes copyright, the associated brands’ reputation is at risk.

A well-placed and timed partnership can lead to huge gains but if we were to endorse any message in this area it would be this: aim for the best and prepare for the worst.

This article was first published as part of our “Expert insight on advertising, marketing & sponsorship” publication. Read insights on similar topics in the full publication here