Small Business Accounting - How Effective Are Celebrities That Advertise For a Business?

With the huge increase in TV advertising, using celebrities to advertise a business has become quite common. The real questions though are:

  1. How effective are they for the amount of money they cost?
  2. Does it bring a good return on the investment a business owner will have made?
  3. Does it really make a business stand-out from the number of competing ads?

This has several unknown variables. The main one being what happens if the celebrity falls into popular disfavour through a criminal or illegal act? Some of the popular TV shows in the past have lost viewers because their lead actors have committed illegal acts.

What if the show they are famous for gets cancelled due to poor ratings? Sometimes a TV show only lasts two seasons and if the business owner is looking for a long term TV ad for a couple of years to offset the cost of production, this time limit can seriously cut into a return on the investment made.

Once the celebrities TV ratings drop, it is not a good image to be seen using that 'stars' services to advertise a business. People want to be seen as a 'winner' and if they perceive that someone using an out-of-favour celebrity is using that celebrity, anything they purchase from them could be seen by others as being 'uncool'.

Once a celebrity gets known as a 'has-been' it will reflect on a business who keeps using their services to advertise their own business as being out-of-date. Such is the fickle perceptions of the public.

By using any celebrity to advertise your business, you are tying your fortunes to the fortunes of that celebrity, so a great deal of care needs to be taken. As my parents used to tell me "You will be labelled by the Company you keep"

If a business has done their homework well and picked the right celebrity, particularly if it is done early in the celebrities career, then they will be in the front position to make a small fortune. This is often a gamble, because life has a tendency to interfere and it is hard to guesstimate what the choices a celebrity will make will be. Hopefully, they will be wise and considered career and life decisions and your return on the investment will be maximised.

Does the choice of picking the right celebrity make your ad stand out in today's crowded advertising world? This is a resounding yes. All you have to do is take note of your own reactions when you see a celebrity advertising a product on TV. Because they are someone you already like, you tend to watch their ad and see what it is they are advertising. Just hearing their voice will alert you to the fact that this is someone you like and is familiar to you.

The whole purpose of advertising is to tell people about your product or services. Due to the number of ads people are hit with all day, every day, today, having something that grabs people's attention, gets your ad noticed by millions of people.

By using a popular celebrity to advertise your business, you will have bought yourself a unique selling position and increased your businesses bottom line substantially.