How to Sell with Celebrities, (especially Tiger Woods)

How to Sell with Celebrities, (especially Tiger Woods)

University of NavarraSanjeev Nath

“One approving nod from a famous face can translate into millions in brand sales.”

www.etstrategicmarketing.com

What do they Advertise?What do they Advertise?

• David Beckham– Vodaphone, Pepsi, Real Madrid

• Annika Sorenstam– Calloway Golf, Mercedes Benz

• Michael Jordan– Nike, Gatorade, Hanes

• Tiger Woods– Buick, EA, Nike

Why do Stars Make Sense?Why do Stars Make Sense?

• What do you think?

Why do Stars Make Sense?Why do Stars Make Sense?

• Establishes credibility for target audience– Creates a sense of trust– Great for new products, especially from an

established company

• Attracts attention– Breaks through hundreds of advertisements

making the brand more easily visable

Why do Stars Make Sense?Why do Stars Make Sense?

• Associative Benefit– If the celebrity uses the product and improves, so

will the consumer

• Psychographic Benefit– Since stars are loved, the feeling toward them

may translate to the product• Imitating the favorite sports or movie star

– “I am Tiger Woods.”

Why do Stars Make Sense?Why do Stars Make Sense?

• Demographic Connect– Reaches a specific target audience based on…– Age, gender, wealth, geography

• Mass Appeal– Universal, able to reach more demographic

audiences

Critics Against Celebrity AdsCritics Against Celebrity Ads

• Why do you think celebrities are sometimes a bad idea?

Critics Against Celebrity AdsCritics Against Celebrity Ads

• Brands need to have an identity– The product must stand for something, and the

celebrity should sell what the product stands for

• “I use this product, and so should you,” does not work – Customers are now receiving more information

from a variety of sources: – Internet, consumer awareness groups,

competitors

Why Celebrity Ads FailWhy Celebrity Ads Fail

• Improper Positioning– Relying on the celebrity name only does not

work: • “Just because I use it, everyone should. No matter

what the product is.”

• Brand Celebrity Disconnect– The celebrity does not match the product– E.g. Britney Spears for a Toyota family car

Soluna Vios.

Why Celebrity Ads FailWhy Celebrity Ads Fail

• Clutter Flutter– Too many celebrities doing advertisements

reduces the advantage of this technique– The same celebrity advertises many products

• Dissatisfaction with the Product Quality– Quality is more important than style– No celebrity can sell a flat soccer ball

Why Celebrity Ads FailWhy Celebrity Ads Fail

• Confusion Skepticism– Remembering what the celebrity is advertising

• Celebrity is so funny/interesting, the product is lost

• Skeptical Questions:– Is it possible that the celebrity was helped this

much by the product?– How much did the company pay the person to

join?

Risks with Celebrities Risks with Celebrities

• Celebrity Mistakes– Trouble with the law/drugs, scandals– E.g. Magic Johnson HIV issue

• Company Reaction to mistakes– Continuing w/celebrity may affect the image

(Guilty by association)– Finding a new celebrity is very expensive

• Company may already be defined by celebrity

Hedging the RiskHedging the Risk

• Look for perfect criminal and personal record

• Try to use more than one celebrity– Pepsi: Several Cricket, Basketball, and Film

stars

• Avoid the Force-Fit

Avoiding the Force FitAvoiding the Force Fit

• Choose the celebrity based on the product– Never choose the celebrity and design the

message around them– The celebrity is not the ad, rather the means of

communicating a specific message

• Add a celebrity after developing identity– Avoid using advertising to create the identity– Protects against celebrity failures

So Why a Tiger?So Why a Tiger?

• Why is Tiger Woods amarketers dream?

So Why a Tiger?So Why a Tiger?

• Many believe that Tiger Woods is a Marketers Dream

• Let’s look at his strong relationships with the products/companies that

he sponsors. We will focus mainly on Nike Golf

Tiger plays golf...Tiger plays golf...

• Golf– Number 1 Player in the

world for many years– Recognized as one of the

best players in history– Well respected by his

competitors• Player of the Year Title is

chosen by the players

Tiger works with good people...Tiger works with good people...

• Companies– Contain own strong identities:

• Buick, EA, Nike

– Nike: More than one celebrity• If he fails, the company may not

– Tiger’s association with one company helps sell products for other companies (association)

• E.g. Wears a Nike hat in other commercials

– Companies are all associated with Golf• Buick Classic Golf Tournament

• EA Sports Golf Game

Tiger’s Product MixTiger’s Product Mix

Age 5 Age 95Age 45

Tiger hits the rich and poor...Tiger hits the rich and poor...

• Good two parent family • Father African American, Mother is from Thailand

• Family was not wealthy

• Beautiful Wife• Model from Swedan

• Good looking, very smart• Attended Stanford,

• Writers often comment about his intellect

• Name and face are easy to recognize

• Clean criminal & personal record

Tiger is liked by bad golfers...Tiger is liked by bad golfers...

• Tiger supports a high quality product

• Poor golfers (golfers starting out) – Will try anything to improve their game– Do not know what brand to choose between 30– Became interested in golf because of Tiger

Woods– Tiger Woods products are stylish– May own the Tiger Woods video game– May want to “be like Tiger.”

Tiger is liked by good golfers...Tiger is liked by good golfers...

• Tiger supports a high quality product

• Strong golfers (great players) – Often look for a new edge– May own a Buick or other Tiger sponsored

products• Feel of a champion (emotional connect)

– Tiger’s clubs and ball are customized but…• Not everyone knows this fact

Everyone likes our Tiger...Everyone likes our Tiger...

Low Wealth

High Wealth

Poor GolfersStrong Golfers

Nike Golf Ball Market ShareNike Golf Ball Market Share

• How much ($) is Tiger worth?

• Assume – 1€ = $1.30– .77€ =$1.00

Nike Golf Ball Market ShareNike Golf Ball Market Share

Nike Golf Ball Market Share Percentages

6.3

9.5

00

2

4

6

8

10

Market Share

Market Share 0 6.3 9.5

1999 2001 2003

Nike Golf Ball Market ShareNike Golf Ball Market Share

• Golf balls contain the 2nd most lucractive industry margins ($500 million annually)

• Since Tiger joined, golf balls have earned Nike $72 million GM on a $100 million contract

• Note: Tiger sells other Nike products besides golf balls

Assumption: 60% Gross Margin 6% Nike Market Share

Conclusion: It’s about...Conclusion: It’s about...

• Celebrities can communicate, but not save a product!

• Tiger is a fit for his products, better than anyone else out there today.

Major SourcesMajor Sources

• www.estrategicmarketing.com

• www.forbes.com

• www.money.cnn.com

• www.espn.com

• www.indiantelevision.com