What factors do I need to consider when hiring a celebrity spokesperson?
Whether hiring a celebrity spokeswoman or celebrity spokesman, there are several factors to consider when deciding to add a TV star, film star or famous athlete to your marketing plan.
The first consideration should be whether a celebrity spokesperson is actually needed in the campaign at all. Can you effectively communicate your message with a lesser-known actor? Simply having a celebrity as your brand spokesperson does not guarantee a lift in sales. One of the determining factors in whether a celebrity spokesperson makes sense for your campaign is to examine your competition. Are you in a product or service category that is crowded and congested? Adding a celebrity spokesperson can elevate your brand among the others helping it stand out among the competition. On the other hand, if your product is unique and has very little competition in the marketplace, a celebrity might not be needed. We are definitely in a climate that values both celebrities AND experts in product endorsements, ads, infomercials, and commercials. Maybe bringing in an expert DIY person who is also a GREAT spokesperson can save on your budget but also really create a successful ad. That said, if you do decide to bring on a celebrity onto a campaign, their reputation should align with the values and reputation you are trying to build with your brand.
How should I budget for a celebrity spokesperson?
Another consideration should be talent budget. What budget can you allocate to a celebrity spokesperson? The talent budget will dictate the caliber of celebrity you are seeking. Keep in mind that most celebrities will require you to follow the rules and regulations set forth by SAG/AFTRA. It is important to understand the financial impact imposed on those campaigns that hire a celebrity spokesman or spokeswoman who is a member of SAG/AFTRA as the additional costs can impact the annual talent budget. This is where details are very important. For example, having a SAG signatory and paying into SAG pension and health can add an additional 40% to your talent fee.
This is where figuring out if you actually need a celebrity also becomes a factor. Most great non-celebrity spokespeople (who might still be experts in a given field) are non-union or financial core within SAG/AFTRA that enables them to do non-union work. This is because a large amount of spokesperson work is NOT done under the union. This could be a big budget saver if you ultimately don’t need a celebrity for your product or brand.
Without having a detailed budget in mind, it can be hard to match the right spokesperson to your campaign. Knowing what you have allocated helps determine the caliber of celebrity or sports spokesperson you can afford. With celebrity endorsement rates ranging from $100,000 to well over $5,000,000, it is important to know in advance the budget you have set aside for talent so you know what you can get (and including in the extra cost for tracking of the spot as well as the pension and health should also be factored in advance).
How do celebrity spokespersons get paid?
There are many ways to construct a compensation package for a celebrity and each structure has pros and cons. Most celebrities will want an upfront fee for services and usage. Normally the fee is split with 50% paid at the time the contract is executed with the balance due at the time of services. This fee normally holds the talent to the terms of the agreement for one year with optional annual payments thereafter. These option payments normally reflect an increase to the talent fee and include additional service requirements (ie: updating the content). This is generally the least expensive structure if you are committed to using the content during the length of each contract term. Sometimes a celebrity will agree to a structure that allows the marketer to shoot and test the content for a very short period with a payment due if the marketer wishes to continue using the content after the initial test period. This structure can limit your upfront investment should the content prove to not perform but is generally more expensive over the longer term.
Another option is to receive an upfront fee for the shoot date and a fixed quarterly payment for each 3 months that the spot runs. This is a very popular payment structure in the infomercial or what the industry refers to as “direct response” spots. Why? There is a CALL TO ACTION within the spot that allows the viewers to directly respond and make a purchase. “Call this number” or “Go to this website and order” are often part of these spots and allow the company to find out instantly how well the spot is doing with potential customers. This is different from a commercial because you have no way of knowing if someone will buy the product later on Amazon or pick it up at their next grocery visit.
The final compensation structure involves backend royalty payments and/or stock options. This structure is the least attractive to the celebrity unless the marketer has a strong track record of success. Furthermore, it requires that the company allow the celebrity access to internal company information including accounting statements and furthermore subjects the company to outside audits. The upside is less money up front and if the product does well, the celebrity gets to benefit from that success.
How do I make an offer to a celebrity spokesperson?
Hiring a celebrity broker will not only help to narrow down appropriate celebrity options but will also guide you in presenting an offer letter that can be the most effective. Too often brands underemphasize certain deal points that are important to a celebrity while overemphasizing those points that are less important. It is very important to have someone who knows what those deals are supposed to look like and can structure an offer that is enticing to the celebrity. Crafting a balanced offer letter that incorporates product/service information, relevant deal points and creative strategies will result in the highest chance of a positive response. In addition, it is important to know where and to whom you should direct the offer. With teams of business accountants, publicists, agents, and entertainment managers all working for that celebrity, each team member brings certain expertise and guidance to that celebrity. Knowing who has what influence and can present this deal to the celebrity with the most educated frame of reference in the space, can dramatically impact the response.
What are common mistakes in trying to secure a celebrity spokesperson?
One of the biggest mistakes made when pursuing a celebrity is to reach out without a formal offer in place. Too often companies reach out to try and gauge a certain level of interest prior to moving forward with a proposal. Or trying to find out from the celebrities team a possible budget they might consider. It isn’t their job to figure out those deal points. Their job is to present opportunities to their clients that will benefit them. And the best way for them to do that is to have clear parameters of what that offer will look like. The actual compensation proposal is one of the most significant factors a celebrity uses in determining their level of interest. Remember, these celebrities understand the value of their image in the marketplace, so it is incumbent upon you to provide a financial offer to a celebrity immediately. It shows you are serious about your intent and furthermore, most agents, managers or publicists will not even involve their clients until an offer is in writing. So if you are reaching out without this in place, the inquiry may be ignored entirely until there is a more formal offer in place. Depending on the caliber of the celebrity, you may lose your chance entirely if you don’t have these deal points ironed out the first time you reach out to them.
Hiring a celebrity broker, figuring out exactly the budget you can afford so you can create a realistic list of the caliber of celebrity you can afford, and keeping in mind the additional costs you will incur by having the project be under SAG/AFTRA are ultimately the biggest thing to consider when looking to hire a celebrity spokesperson.
Blair Taylor is a talent broker at TaylorTalentServices.com. He, along with his partner Shannon McArdle, have helped hundreds of company’s secure celebrity spokespeople including Robert Herjavec (“Shark Tank”), Deborah Norville (“Inside Edition”), Terrell Owens (former professional football player), Anthony Scaramucci (Former White House Communications Director), reality icons Kendall Jenner, Kim Kardashian, Kris Jenner, Kylie Jenner, Debbie Gibson (pop singer), Dennis Rodman (former professional basketball star), Joe Montana (former professional quarterback), Kathy Hilton (“Real Housewives of Beverly Hills”), Dr. Travis Stork (“The Doctors”), La Toya Jackson (singer), Kym Johnson (“Dancing with the Stars”), Carol Alt (former Supermodel), Isaiah Mustafa (“Old Spice”), John Boehner (former Speaker of the House of Representatives) and many more!