Business planning, Sales and marketing

Start-ups should be wary of the celebrity endorsement brand-building shortcut: Branding expert

Rose Powell /

While a celebrity endorsement can be a boon for a start-up keen to get their name out there, it can be a treacherous and challenging task for a new company to manage, says brand consultant Michelle Hogan.

 

Brumby’s Bakery, owned by parent company Retail Food Group, has this week announced former Australian cricketer Matthew Hayden as their new “bread” ambassador.

 

Hogan says the move makes sense for an established business like Brumby’s Bakery, which has its supply chain and organisational infrastructure already in place, but says the smarter choice for start-ups is to focus on the less glamorous but more enduring branding aspects.

 

“Brand is a result of the promises you keep, so everything you do builds your brand. Rather than chasing a celebrity, start-ups should focus on building consistency in a really deliberate and conscious way so you can keep repeating it,” Hogan says.

 

“These systems build customer satisfaction, which drives word of mouth, repeat customers and loyalty, and that’s everything a growing business needs in order to survive.”

 

Hogan says the right celebrity endorsement can boost a business, but start-ups need to approach the partnership as a merger.

 

“A lot of people don’t think about it this way, but it is. You’re taking someone’s personal brand, and trying to leverage that in favour of your brand or organisation,” Hogan says. “As you’re linking yourself closely to someone else, you’re also attaching your company to their personal highs and their lows, and that can backfire on you really badly.”

 

Hogan says brands that are big enough can weather the fallout of poor celebrity endorsement decisions, but start-ups need to be especially wary.

 

“Even with someone who fell from grace hard like Tiger Woods, I don’t think Nike would say they didn’t get their money’s worth. Woods single-handedly built their credibility in golf,” Hogan says.

 

“But while they may stick to the script while talking about your organisation, they aren’t thinking of your brand when they’re living their lives.”

 

Hogan adds that while the right partnership can result in a sales surge, start-ups should prepare for a spike in traffic, interest and demand.

 

“If you’re brand new and get the big get, you need to be ready for the potential result. Ask yourself if your server is up to scratch, are your communications sorted out, and do you have a way to scale up your stock quantity or service supply quickly?” Hogan says.

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Rose Powell

Rose is the current head of growth at Rampersand Ventures. She was formerly a reporter at StartupSmart.

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