1.05 ENDORSEMENTS

ENDORSMENTS A celebrity endorser is a well-known person who:  Approves  Promotes  Supports goods/services for pay Many well-known athletes and entertainers are paid to endorse a wide variety of sport-related products and events.

Most commonly used type of endorsement involves paying celebrities to appear in advertisements. Companies tell them what to say. It involves having the person appear in a print or broadcast advertisement and talk about how great the product is. Other types of endorsements include paying celebrities to use brand of equipment, wear a certain brand of clothing, or appear at an event.

ENDORSEMENTS Companies pay colleges and high school sport teams to wear a manufacturer’s clothing. The hope is that other young people will want to buy the clothing because they are influenced by what the athletes are wearing. The student athletes are suggesting their approval rather than making positive statements, giving testimonials, or serving as spokespersons.

ENDORSING AN EVENT A celebrity attending a grand opening to attract customers. Endorsing an event simply by being associated with it does not involve appearing in a print ad, saying a tournament is great, or cheering for a football team.

Testimonial A person who uses product stating the benefits received from the use of the product. A celebrity who is paid to use a product and discuss its effectiveness during a lengthy TV commercial, or infomercial, is actually giving a testimonial for the product.

During the infomercial, the celebrity explains why the product is good and why consumers should buy it.

Warm-up Which of the following is an example of a celebrity endorsing an event simply by being associated with it: A. Appearing in a print ad B. Saying a tournament is great C. Attending a grand opening D. Cheering for a football team

Warm-up A celebrity who is paid to use a product and discuss Its effectiveness during a lengthy TV commercial is giving a(n) A. interview. B. personal observation. C. testimonial. D. sales presentation.

What type of businesses uses sport figures?

All types of businesses use celebrity sport figures to endorse their goods and services. Even businesses that have no connection whatsoever with sports or events pay well known athletes to be endorsers.

Endorsing Services Celebrities promote services like credit cards and health services. Although celebrities are most often used to endorse tangible items on the retail level, they are sometimes used to endorse services.

Cross-promotion Cross-promotion occurs when a celebrity endorses more than one product, or products for another company. Then, all the companies gain from the increased awareness because consumers associate the celebrity with all the products.

Example: Cross-promotion An example of cross-promotion is a appearing in a commercial for: A celebrity a soft drink while wearing a certain brand of clothing holding a certain brand of tennis racquet. All three products benefit even though the commercial is for the soft drink.

The purpose of inviting celebrities to participate is to increase attendance. For example, on opening day of baseball season, most ballparks have a celebrity throw out the first ball. Fans come not only to see the game, but to see the celebrity.

Celebrities Are Most Effective Promoting Products Related to Their Sport.  Endorsement has a certain amount of authority.  Celebrities know a lot about those products.  People pay attention to what they say.

OBJECTIVE B Considerations using celebrity endorsements

Benefits of Celebrity Endorsers Celebrities attract attention People want to be associated with celebrities

Benefits of Celebrity Endorsers Celebrities have a lot of appeal because of their fame and because the public is curious about them. As a result, people are more likely to read an ad, watch a commercial, or attend a special event featuring a celebrity rather than an ordinary, unknown person.

Disadvantages of Celebrity endorsements Inappropriate or illegal actions Celeb. overshadow product/service Expensive to pay Celeb.

Inappropriate or illegal actions Ravens' Ray Rice: 'My actions were inexcusable'

FEDERAL TRADE COMMISSION

Federal Trade Commission (FTC) Endorsements are a form of advertising. Businesses that use celebrity endorsers must follow the Federal Trade Commission’s rules and guidelines regarding advertising because endorsements are a form of advertising.

A FTC rule is that endorsements must always reflect the honest opinions Kim Kardashian removed a series of Facebook and Instagram posts touting the benefits of prescription morning sickness drug Diclegis after they were found to breach US Food and Drug Administration (FDA) regulations.

The FTC regulation prohibit businesses from reworded to distort the endorser’s opinion or experience with a product. This means that a company cannot use only part of what a celebrity says to make it sound like the celebrity believes in a product. To avoid this problem, businesses generally use exact quotations.

The celebrity endorser must be the actual user of the product or service.

The celebrity must be an expert of the product they are endorsing. Example: A professional bowler endorsing a brand of bowling balls.