The Evolution Of Celebrity Endorsements

From plain endorsement deals, the market is now evolving to full-fledged partnerships through innovative structures such as equity deals, royalty arrangements, JVs, and strategic merchandising partnerships.

- Aviral Jain

CELEBRITY ENDORSEMENTS HAVE been a key feature of the Indian marketing space. Nearly 50% of endorsements in India feature celebrities compared to around 20% in the U.S. With the increase in penetration of digital cable television and adoption of social media as a marketing tool, the decade beginning 2010 has seen a significant evolution in the Indian endorsement space.

According to industry sources, the number of celebrity-led endorsements increased to 1,660 ads in 2017 from 650 ads in 2007—a compound annual growth rate (CAGR) of 10%. Film stars currently dominate with a 76% share of the endorsement market, followed by sportspersons at 12%. The personal care/hygiene and food & beverages industry with 33% contributed the largest chunk of celebrity-led campaigns. While the personal care, jewellery, and banking segments are dominated by female endorsers, the e-commerce, automobiles, real estate, and smartphones segments primarily feature male endorsers.

According to Duff& Phelps’ ‘Celebrity Brand Valuation Report 2018—The Bold, the Beautiful and the Brilliant’, the celebrity brand value of the top 15 endorsers in India grew nearly 13% from $691 million in 2017 to $782.2 million in 2018, which highlights the increased confidence placed by product brands in celebrity endorsers.