Is Celebrity Endorsement a Futile Exercise For Many Startups? According to a report by TAM Media Research's AdEx India, 27% of the overall ad volume share on TV were celebrity endorsements in 2021

Celebrities continue to dominate the endorsement space even today when digital ads have taken over print and television ads. Even though there are multiple other avenues to market a product, new-age brands, just like their legacy counterparts, also seem to be going in for celeb marketing, even if it means burning a hole in their pockets. And, within celebrity marketing, film stars still dominate the industry, followed by sportspersons and now content creators. According to a report by TAM Media Research's AdEx India, 27% of the overall ad volume share on TV were celebrity endorsements in 2021 while the remaining 73% were non-celebrities ads.

But, do these brands get the anticipated visibility and awareness post the release of these ads? Given that, every celebrity, be it movie stars, sportspersons or content creators, is today endorsing multiple brands at one time. For instance, actor Ayushman Khurana has been the face of many brands including The Man Company, Magicbricks, Toyota Urban Cruiser, Tide, Balaji Wafers, Nestlé's KitKat Bajaj Allianz, Samsung Galaxy and many others. Amitabh Bachchan has endorsed Cadbury's Dairy Milk, upGrad, Flipkart, Navratna Oil, Dr. Fixit, Gujarat Tourism, Mankind, Pepsi, Rin, Ghari Detergent, Tata Sky, Cycle Agarbatti, FirstCry, Tanishq and Kalyan Jewellers. The list goes on. However, not all these advertisements have been successful in popularising the brands.

With 'skipping ads' a choice today, does it make sense for startups to spend so much on onboarding celebrities? If yes, what is the right time to opt for these expensive marketing techniques?

Why do brands go for celebrity endorsements?

"Celebrities and brands have had a long-standing relationship for years across geographies, categories and media. In today's time, with the smartphone generation, breaking through the clutter and grabbing your target audience's attention is a matter of moments. Plus, India is a trust-deficit market and so tying up with celebrities builds a certain credibility as well as helps brands stand out instantly," said Megha H Desai, Co-founder, ENGN, an athlete representation company.

Further, if you're entering a crowded category like fashion, beauty, snacks, etc you not only want your brand to be noticed but you also want your customer to believe this 'new entrant' has some gravitas, she added.

Experts feel that a celebrity association if done well, can immensely help in the initial funnel metrics of consideration, intent, etc for a startup especially.

For established brands, celeb advertisements drive trust and give them a competitive edge. For brands that are just starting out, these ads are aimed to propel brand awareness. "We look at it more as awareness. We are young and we have ambitions. We want to reach out to more people and tell them that hey, we're doing something and you should give us a chance. But what you have to imagine is that if you want to buy a mobile phone, you talk to friends, you read all the reviews online, and then you buy. But, if you're getting surgery, which is our core job, it is a serious business. So, marketing is not a gimmick for us. It is just a means to create awareness about the availability of a choice in front of consumers," said Harsimarbir Singh, co-founder, Pristyn Care.

Is it worth it?

Often, in this race to stay ahead of the curve, startups end up spending a lot of money on onboarding celebrities. But more often than not, they fail to build brand recall. This is because today most categories in India, be it in any sector, have too many brands and companies.

"Any good marketing idea needs to have the right mix of relevance, authenticity and consistency. This is Marketing 101 and is non-negotiable even while deciding on spending the big bucks for a celebrity. There is no doubt that clever & creative communication done with a celebrity will help the brand build awareness and even affinity in a lot of cases. That's an immediate, short-term return and if that's what the marketer is looking for, then you have got a home run. The challenge comes in sustaining it beyond this short-term return – that's where the category connects with the brand and the celebrity is important," said Desai.

At what stage should startups look at onboarding celebrities for marketing? While there is no particular answer to that, burning cash or putting all your eggs in one bucket, to go in for celeb marketing, is not a wise thing to do either. Instead, go in for many micro-influencers, says Aman Gupta, co-founder, boAt.

"Celebrity marketing can create huge awareness for sure even if it doesn't end up in conversion. But, today, you have the option of micro-influencers. So, instead of betting on one big celebrity who is endorsing many other products, go for micro-influencers. People in India today like the trust that comes from them," Gupta said at the recently-concluded Retailer India's Irec Summit 2023.