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Introduction
In the last three decades, most companies have focused on joining international markets in response to rising competition in the domestic market. International marketing is one of the concepts that have helped companies to join overseas markets successfully. International marketing refers to a multinational process of planning and executing the conception, pricing, promotion, and distribution of products to create exchanges that satisfy individual and organizational objectives (Czinkota & Ronkainen 2007, p. 7).
This concept helps companies to identify the right mode of entry, product development, positioning, pricing, and promotional activities to use in new markets. Celebrity endorsement is an integral aspect of international marketing since it facilitates activities such as market positioning, and sales promotion. Celebrity endorsement is a type of advertising campaign in which a third party or a spokesperson (a celebrity) uses their fame to support or approve a product to increase its sales (Kleindl 2006, p. 112). This paper will discuss the concept of celebrity endorsement by analyzing the Beckham case study. It will also highlight the advantages and disadvantages of using celebrity endorsement in marketing.
The Success of Beckham as an Endorser
David Beckham was a successful endorser of various products due to the following reasons. First, analysts believed that he had all the attributes of an ideal icon. His attributes included good looks, exceptional talent in football, image, and style. Additionally, he had a unique lifestyle as a family man, a husband of a pop star, and a fashion-conscious person. These attributes made him a popular brand in the UK and the Far East. Consequently, he could improve the brand equity of any product that was associated with him. Second, marketers believed that using Beckham in adverts would increase the sales of their products significantly.
This is because his attributes as a celebrity could not be paralleled with those of other sports personalities. Thus, using him in adverts was a way of differentiating products and positioning them as unique and superior. Third, the attributes of Beckham were easy to match with the qualities of a wide range of products. For instance, he successfully promoted Adidas products due to his charisma. Finally, he could appeal to a wide range of people, including non-football fans due to his fame. For instance, he was more popular than all football players in the Far East were. Thus, using him in promotional activities would increase product awareness tremendously.
The Values that Beckham Signified
Beckham was the favorite of most marketers due to the values that he signified as a brand. To begin with, he was a style icon who was known for setting new trends in the field of fashion. Consequently, he created an image of exclusivity and luxury. The products that he endorsed were also associated with these values. Hence, he improved the brand personality of the products that he endorsed (Silvera & Austad 2004, p. 1509-1526).
Concisely, the customers were likely to purchase the brands by associating them with luxury and exclusivity. For instance, Vodafone realized a one-third increase in sales after its camera phone was endorsed by Beckham in Japan. Beckham was always conscious of his image and new fashion trends. For instance, he kept changing his hairstyle to continue being attractive to the public. This implies that he was aware of the importance of relevancy and consistency in branding. A strong brand must be relevant to meet customers expectations (Spry, Pappu & Cornwell 2011, p. 882-909). Thus, it must adapt to changing tastes and preferences.
Additionally, a consistent brand must signify what it stands for to win customers loyalty. Beckham focused on setting new fashion trends to portray himself consistently as a fashion icon. In the Far East, his values such as respecting family life and abstaining from drug abuse increased his popularity. The Far East countries such as Japan believe in these values: thus, they are likely to trust Beckhams endorsements. Trust is important in branding because it enhances brand image (Zou & Fu 2011, p. 132). For example, both Beckham and Castrol Power were associated with attributes such as power, winning, and world-class in Asia.
Benefits to the Companies
First, the brand image of the companies and their products improved after associating with Beckham. This is because most of the customers believed that the products had attributes that were as superior as those of Beckham. For instance, Brylcreem was traditionally considered a brand that is meant for old men. However, Beckhams endorsement made it more appealing to the youth. Consequently, it was able to overcome competition from its competitors such as Studioline. Second, Beckham helped the companies to improve their brand awareness. Most products became very popular in various markets due to Beckhams fame.
The benefit of high brand awareness is that it boosts sales (Knight & Hurmerinta 2010, pp. 452-460). For instance, Meiji doubled the sale of its chocolates after Beckham endorsed them in Japan. Finally, the companies benefited by gaining credibility, especially, in the Far East market. Beckhams values were strongly admired in the Far East. Customers trusted the products that he endorsed: thus, the companies credibility improved in the Far East region. The benefit of brand credibility is that it improves customer loyalty. This is because the likelihood of repeat purchase is often high when customers trust a particular brand.
The Benefits Gained by Real Madrid
Real Madrid enjoyed the following benefits by hiring Beckham. To begin with, hiring Beckham was meant to help the club to improve its financial fortunes. In particular, the club intended to expand the market for its merchandise by hiring Beckham. Even though Real Madrid was a successful football club in Spain, its popularity in overseas markets such as Asia was less than that of its rivals such as Manchester United. Thus, joining international markets was likely to be a serious challenge to the club due to a lack of brand awareness. Concisely, the clubs products were likely to penetrate the market with difficulty due to their low popularity.
Brand awareness can increase significantly through promotional activities that focus on effective marketing communication (Kleindl 2006, p. 78). It is against this backdrop that Real Madrid hired Beckham to promote its products. The club believed that hiring Beckham would improve the popularity of its merchandise. The resulting increase in sales would expand the market share of its products in international markets such as Asia.
Hiring Beckham was considered an effective strategy due to several reasons. Unlike Manchester United, Real Madrid had little recognition and support in Asian countries. The Asian market is important due to its large size and high profitability. Most Asian economies such as China and Japan have traditionally recorded high GDP growth, thereby improving the purchasing power of their citizens. Thus, Real Madrid was likely to increase its revenues by selling its merchandise and media rights in this region. Since Beckham was already the most popular footballer among Asian fans, hiring him would improve Real Madrids recognition in the region.
Multinational corporations usually sponsor successful football clubs with renowned players. Hence, Real Madrid was likely to obtain financial support from Asian multinational corporations by improving its performance through Beckhams help. Besides, a large number of soccer fans in Asia were likely to shift their support to Real Madrid after the transfer of Beckham.
Finally, Real Madrid expected to increase its revenue after hiring Beckham. The club expected to earn at least six million pounds by including Beckham as one of its best players. As a fashion icon who was associated with success, Beckham was the favorite of most sponsors. Consequently, corporate sponsors were likely to support the team that he played to create awareness about their products (Byrne Whitehead & Breen 2003, pp. 288-296).
The football star was expected to help Real Madrid to improve its attractiveness to fans and sponsors by opening both the UK and Asian markets. The resulting improvement in the clubs brand equity would help it to compete with its rivals such as Manchester United.
The Price Paid for Beckham
Real Madrid paid a lot of money to hire Beckham. Most critics believed that the price was too high due to two reasons. First, the demand for soccer players was low at the time of the transfer. Consequently, players were expected to fetch low prices. Second, some critics believed that the money should have been spent on more profitable investment projects. Most clubs were reluctant to spend a lot of money on hiring players due to their poor financial performance at that time. Even though these criticisms make economic sense, they fail to provide a strong case for disapproving of the amount of money that was used to hire Beckham.
This is because they focus on the misfortunes of the football industry rather than Real Madrid. The club had to pay the high price because Beckham was not just a football player, but also the most sought after style icon in the sports arena. Since his brand worth was as high as 200 million pounds, Manchester United could not have accepted a low price. Analysts believed that the club was capable of recovering the money by selling T-shirts. Moreover, Real Madrid is expected to benefit in several ways by hiring Beckham. These include improving its brand equity, generating more revenue, and winning the support of more fans. In this context, the deal was profitable for the club. Consequently, the price paid by Real Madrid was justified.
Celebrity Endorsement
A celebrity is a person who is famous because he has excelled in a particular field of action. Most celebrities are associated with admirable attributes such as attractiveness, unique lifestyles, and extraordinary skills. Thus, most of them enjoy public recognition by a large number of certain groups of people (Knight & Hurmerinta 2010, pp. 452-460). Product endorsement is a testimonial in which an individual expresses his approval or preference for a given brand.
Socially prominent individuals normally do product endorsements on behalf of various companies. In this context, celebrity endorsement can be defined as the use of famous personalities approvals to increase the sales, as well as, the recall value of a brand (Knight & Hurmerinta 2010, pp. 452-460). Celebrities symbolize different images and values that derive their relevance from different cultures. Marketers believe that the likable characteristics of celebrities can be transferred to a product, thereby increasing its popularity.
In the early 1980s, endorsements were done through written testimonials in which celebrities shared their positive experiences with various products. However, modern endorsements involve using celebrities to advertise products.
In some cases, marketers use celebrities photographs to create a visual connection between the endorser and the product (Silvera & Austad 2004, p. 1509-1526). The factors that must be taken into account when using celebrity endorsements include the match between the celebrity and the product; the ability of the celebrity to attract the target audience; and the cost of hiring the celebrity. Other factors include the celebritys risk of controversy and prior endorsements.
Implications of Using People as Brands
Some experts believe that using celebrity endorsements is an effective marketing strategy. This is because they believe that it is capable of increasing sales and product awareness. Most marketers concur that globalization has led to the emergence of similar consumer demands and tastes in different parts of the world. This premise is normally used to justify the standardization of adverts in international marketing.
It is against this backdrop that multinational corporations use celebrities with global recognition to advertise their products (Silvera & Austad 2004, p. 1509-1526). This helps in overcoming the cultural complications associated with creating adverts for each market. Moreover, using a single advert in different markets helps in cost reduction. Nonetheless, some experts believe that using celebrity endorsements to create standardized adverts is an ineffective strategy.
This is because fundamental consumer values remain divergent despite the existing convergence in various parts of the world. In this regard, customers might not connect with standardized adverts in some markets. Some marketers reject the use of celebrity endorsements by claiming that successful brands must have their own identity (Kleindl 2006, p. 231). Consequently, a brand should not piggyback on the reputation or identity of a celebrity to succeed. Celebrity endorsements usually fail because they are not used in the right context. However, using celebrities in adverts can be meaningful in the presence of an idea that makes the endorsement relevant to the product.
Advantages to Companies
Using celebrity endorsements benefits companies in the following ways. First, it helps to increase the sales of the company. A single approval from a famous personality can increase brand awareness significantly, thereby increasing sales. Second, using celebrity endorsement is a time-tested strategy that has helped several multinational corporations to penetrate new markets (Knight & Hurmerinta 2010, pp. 452-460).
Large multinationals such as Nike, Pepsi, and Coca-Cola have used celebrities to market their products successfully in different markets. Third, using celebrities to endorse products is a valuable tool in branding. It helps companies to build credibility, foster trust, and to attract the attention of the public. These capabilities facilitate improvements in brand equity. Finally, celebrity endorsement is central to marketing success. Traditional advertising campaigns may or may not succeed in convincing customers to buy a product. However, customers are likely to purchase a brand that has been endorsed by a trusted celebrity (Knight & Hurmerinta 2010, pp. 452-460).
Disadvantages to the Companies
Celebrity endorsements have the following disadvantages. Firsts, hiring celebrities is often very expensive. Celebrities with high brand worth such as Beckham often demand high prices, thereby limiting their availability to most companies. Second, the popularity of celebrities often declines. The popularity of the celebrity is likely to reduce if they change their values or get involved in scandals that tarnish their name.
The reduction in the celebritys popularity will lead to a decline in brand equity (Byrne, Whitehead & Breen 2003, pp. 288-296). Third, using celebrities in international marketing might not be effective since some pop icons are not likely to be popular in all markets. Fourth, finding a celebrity whose attributes fit the product that is to be endorsed is often difficult due to the limited number of famous people. Finally, most celebrities often endorse multiple brands, thereby confusing customers. This reduces the brand recall value and the sales of the product.
Advantages and Disadvantages to the Celebrity
Endorsing a product is an excellent opportunity for making money. Most celebrities are paid huge sums of money when they help companies to market their products successfully. It is also an opportunity to tour the world (Silvera & Austad 2004, pp. 1509-1526). Celebrities with high international recognition are often hired in different parts of the world. This gives them a chance to visit new places. Finally, endorsing products, especially, through adverts increases the popularity of celebrities. This opens up new markets for them to sell their services as product endorsers.
Despite these benefits, product endorsements can overexpose celebrities, thereby reducing their brand worth. Corporations that are interested in signifying exclusivity as a value in their brand are not likely to hire overexposed celebrities. Product endorsements often involve legally binding contracts (Silvera & Austad 2004, pp. 1509-1526). The financial implications associated with these agreements might prevent a celebrity from terminating the contract to pursue personal interests. Finally, the celebrity must restrict his or her behavior to avoid any scandal or occurrence that might affect his integrity to remain attractive to the public and advertisers.
Alternative International Promotional Tools
The following international promotional tool can be used as an alternative to a celebrity endorsement. Effective international marketing communication can be achieved through social media. Dominant social media websites such as Facebook and Twitter command a huge following across the world. The main objective of international marketing is to reach a large number of potential customers with the same information in a cost-effective manner (Kleindl 2006, p. 41).
Advertising through social media is likely to increase brand awareness and brand equity since a large number of potential customers access them daily. Also, they are cheaper than using celebrity endorsements. Brand image and brand personality can be enhanced through social media by including expert information about the product in adverts. In this regard, Real Madrid could have increased the popularity of its merchandise by advertising them through social media.
This would enable them to reach customers in Asia and other parts of the world in a cost-effective manner. They did not need Beckham because the team already had four football icons. Additionally, it was performing better on the pitch than other clubs such as Manchester United. The other advantage of social media is that it can enable the club to engage its fans in direct conversations concerning its players, performance, and merchandise. This provides an opportunity for improvements by incorporating customers views in product development.
Conclusion
Celebrity endorsement is an international promotional tool in which a famous person approves a brand to increase its sales. The importance of this tool is that it helps companies to build credibility, to foster trust, and to attract the attention of the public. It is against this backdrop that several companies including Real Madrid hired Beckham to endorse their products. Beckham was successful as an endorser due to his popularity, personal values, and physical attractiveness.
Furthermore, he was a style icon who attracted the attention of millions of people. Despite its benefits, celebrity endorsement may fail to achieve its purpose. This failure is attributed to the high cost of hiring celebrities, reduction of the celebritys popularity, and the inability to link the attributes of the celebrity to the products characteristics. In this regard, celebrity endorsements can only be effective if they are used judiciously.
References
Bryne, A, Whitehead, M & Breen, S 2003, The Naked Truth of Celebrity Endorsement, British Food Journal, vol. 105 no. 5, pp. 288-296.
Czinkota, R & Ronkainen, A 2007, International Marketing, McGraw-Hill, New York.
Kleindl B 2006, International Marketing, Palgrave, London.
Knight, E & Hurmerinta, L 2010, Who Endorses Whom? Meanings Transfer in Celebrity Endorsement, Journal of Product and Brand Management, vol. 19 no. 6, pp. 452-460.
Silvera, D & Austad, B 2004, Factors Predicting the Effectiveness of Celebrity Endorsement Advertisements, European Journal of Marketing, vol. 38 no. 11, pp. 1509-1526.
Spry, A, Pappu, R & Cornwell, T 2011, Celebrity Endorsement, Brand Credibility and Brand Equity, European Journal of Marketing, vol. 45 no. 6, pp. 882-909.
Zou, S & Fu, H 2011, International Marketing: Emerging Markets, McGraw-Hill, New York.
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