What do your Commerce School professor, MTV’s Lauren Conrad and President-elect Barack Obama have in common? Answer: Blackberry dependency issues.
The little electronic e-mailing device that at least one person you know got for Christmas has been a mainstay in the retail market for some time. Even with the advent of the iPhone and other organize-it-all devices, the Blackberry has kept its marketing appeal. The new Blackberry Storm, with GPS, a media player and a high-resolution screen, seems to do just about anything.
Most recently, it has received some high-profile attention from a source that would be any advertiser’s dream. If Blackberry needed another celebrity spokesman, it is hard to beat the newly elected leader of the free world.
As Inauguration Day approaches, Obama has put up a strong fight to keep his Blackberry. Security concerns have been cited as the reason he will have to surrender the device upon taking office. Throughout his campaign, the President-elect kept in touch with friends, advisors and family with constant messaging. In a recent interview with CNBC, Obama said his advisors would need “to pry it out of my hands.” Research in Motion, the company that produces the Blackberry, however, may have a hard time counting all the benefits it receives from Obama’s statements. With retail markets struggling through one of the worst holiday seasons in recent memory, Research in Motion can boast having the best endorser in town and with the best price tag. Advertising experts have quoted Obama’s endorsement as worth up to $50 million for the company. Some have called it the best celebrity endorsement deal in history — not a small statement in an advertising world that runs on famous faces.
For companies, choosing a celebrity to endorse a product can be a costly practice. First, the contract price keeps rising. Jerry Seinfeld, for example, just signed a $10 million contract with Microsoft for a television spot. To get A-list names, a company must be prepared to deliver the increasing contract numbers.
Once secured, there is no way to know whether the name will make a difference in sales. Despite the prevalence of celebrity endorsements in print, television and radio ads, these types of ads still remain risky endeavors. Advertisers consider celebrity value to the product “borrowed equity.” The company hopes the value of the endorser in his or her own industry will transfer into the retail market. Hire a well-known actor to pitch the new version of a product, and his or her notoriety may be the push it needs to sell. There is, however, no guarantee that the investment will pay off. For good or bad, the product image is tied to an individual’s personal life.
A bad press scandal or health problem for the celebrity might trickle into product sales. It can make those millions of dollars in contract fees either worthwhile or a terrible investment.
There is also the issue of cross-endorsement. If Tiger Woods speaks for TAG Heuer, does it weaken his message for another company’s product? Celebrity endorsements bank on an audience’s faith in the celebrity’s words. Just paying a famous name to pose with a product is not always a believable move to consumers. Endorsements can make or break the company’s attempt to forge brand status for its product, and a celebrity who endorses multiple products may seem less genuine.
Obama’s devotion to his Blackberry shows celebrity endorsement working at its best. He has made statements without the incentive of a high-price contract, making his words pricelessly authentic. Another key to successful endorsement is a strong connection between the endorser and the product. And it would be hard to deny that the president of the United States needs to be an efficient communicator, fitting perfectly with Blackberry’s product mission. Even the risk of bad press for the product is mitigated, because the company did not solicit Obama for his opinions. Of course, a soon-to-be president advertising for Blackberry does start some serious questions about how far celebrity endorsements could go. Sarah Palin in ‘09 for Budweiser, anyone?
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