The celebrity sell: advertisers use black celebrity endorsers to pump up sales

The celebrity sell: advertisers use black celebrity endorsers to pump up sales – Special Report

Sonia Alleyne

THE MOST DOMINANT PLAYER IN THE GAME, THIS THREE-TIME NBA Finals MVP is an imposing figure–physically and in his accomplishments as an athlete. At 7’1″ and 350 pounds, the L.A. Lakers’ center, Shaquille O’Neal, affectionately known as Shaq, plans to make the same impression in business. Among his investments, O’Neal owns commercial property in New York City, residential property in Denver, and six self-serve car washes in Orlando. “I’m not going to be making this basketball salary forever,” he states. O’Neal flashes a broad, confident smile and it instantly reveals his appeal in another lucrative venture–that of celebrity endorser.

“He’s a world-class athlete. He’s also cool, personable, and he’s fun,” offers Perry Rogers, president of Alliance Sports Marketing in Las Vegas, Nevada. Those are the qualities that excite marketers and resonate with consumers. “It’s what Mike and I have focused on from the beginning,” says Rogers. “Articulating first the characteristics or qualities that Shaquille has and then finding those companies you think match.” Rogers, in partnership with O’Neal’s uncle, Mike Parris, has negotiated lucrative endorsement deals with Burger King, Radio Shack, and a video game he cannot yet reveal over the last several months.

The partnership was formed last October after O’Neal, dissatisfied with his former agent, Leonard Armato, decided he needed new representation. His former deals included Reebok, Pepsi, Spalding, and Taco Bell, but when the contracts expired, he says no one wanted to hire him. “I was one of the top athletes, but I wasn’t doing much in endorsements,” explains 30-year-old O’Neal. “I wanted to get someone new and energetic.”

He also wanted better-constructed contracts. For example, he would only agree to endorse Burger King if becoming a franchise owner was part of the equation. They concurred, and the two parties are presently finalizing the details.

Another major requirement is that O’Neal has to feel an affinity to any product he endorses. “I’m not just going to take your money,” O’Neal asserts. “I have to like the product. I have to have used the product.” It’s one of the reasons he’s rebuffed several offers to appear on the Wheaties cereal box. Dubbed the “Breakfast of Champions,” O’Neal says he’s never eaten it. “If Frosted Flakes, Fruit Loops, or Dig ‘Em Snacks called me, then we could talk,” he jokes. His other endorsements include Starter, Nestle’s Crunch, and Swatch, totaling roughly $14 million.

Many of us can still easily recall the image of our biggest–and arguably sexiest–’70s star, Billy Dee Williams, touting the social advantages of drinking Colt 45 Malt Liquor, or Muhammad Ali, our greatest sports hero, attesting to the strength of a particular pesticide. Another classic is that of battle-weary “Mean” Joe Green rewarding a little boy with his sweaty Pittsburgh Steelers football jersey in return for a thirst-quenching bottle of Coca-Cola.

And if endorsement opportunities for black male celebrities were limited 25 years ago, they were virtually nonexistent for black female celebs. Some years ago, when Tina Turner rolled her tongue over her pearly whites, marketers thought it too sexy an impression for a short-lived toothpaste commercial. But by the mid-’90s, it was the sexy silhouette of Turner’s legs that sold Hanes hosiery and secured the hot, middle-aged rock star an endorsement contract. To quote another classic advertising catchphrase, “We’ve come a long way, baby.”

Top black celebrities have moved beyond roach spray and brew to endorse a wider variety of wares. Legendary athlete Michael Jordan has dominated the world of celebrity endorsements, pitching everything from Nike shoes and Hanes underwear to hot dogs and cologne. Meanwhile, Tiger Woods and Venus Williams are the reigning king and queen of celebrity endorsements, ringing up larger deals than anyone, regardless of race.

And whereas many African American endorsement deals are still connected to sports apparel and fast food, we’re also seeing black celebrities endorse more fashion products, automobiles, and general market beauty products. Among them: George Foreman hawks a hot-selling, eponymous grill; Lil’ Kim and Mary J. Blige push M.A.C. makeup; Star Jones is the spokesperson for Payless Shoes; Brandy and Queen Latifah endorse CoverGirl (the latter also endorses Absolut and Reebok); and Halle Berry pitches for M&M’s and Revlon.

What does this growth say about Madison Avenue–an unabashedly white marketing machine? Is it finally becoming color-blind? Or is it finding it greener on the black-hand side? And what does the courtship of the African American dollar by advertisers mean?

WHAT’S THE DEAL?

An advertiser’s goal is to reach an audience who will purchase its product and to develop a relationship with that audience to engender brand loyalty. “Celebrities are a quick read,” offers Kay Humphries, associate creative director at E. Morris Communications Inc. in Chicago. “They quickly communicate the message.”

It has been the bedrock of Pepsi’s advertising. “It’s truly vital to our customer base,” explains Mark Rooks, Pepsi’s senior marketing manager of multicultural marketing. “Not only does that celebrity bring new value, excitement, or humor but they bring an energy and memorability that you don’t get sometimes with non-celebrity advertising.” Over the years, Pepsi has used and continues to use a number of African American celebrities for general market and targeted advertising, including O’Neal, Blige, Berry, Wyclef Jean, and Busta Rhymes, who did a targeted campaign for their Mountain Dew product. Damon Wayans is currently endorsing Pepsi’s Aquafina to the general market.

“Advertisers are finally getting it,” Humpries adds, careful not to suggest that marketers have totally embraced the African American market. “They’re understanding how viable the African American public is.”

Today, we receive advertising impressions through various mediums. These impressions, however, are only effective if the consumer receives them favorably. And the consumer du jour is African American. “The black consumer can make any brand in any category No. 1 in that category,” says Bernie Washington of Washington Daniels Advertising Inc. in Chicago.

This is why the editors of BLACK ENTERPRISE recently surveyed African Americans on their choices of the top black celebrity endorsers. One thousand people responded to our online survey, which was posted on blackenterprise.com. We wanted to gauge celebrities’ influence on consumers’ buying habits and compare the results to our industry research on the top black endorsers. (See sidebars for rankings.)

According to the 2000 U.S. Census, between 1994 and 1999, overall consumer expenditures, as measured by the Bureau of Labor Statistics, grew 23.7%. Expenditures by African American consumers grew 40.1%. It is estimated that the buying power of affluent African Americans will reach $292.4 billion by 2006, and the African American market will total $682.5 billion by 2006.

“We understand that America today is a lot different from the America that our parents may have grown up in,” offers Rooks. “Urban or ethnic consumers make up about 30% of the total population, but when you look at the under 20 population, it’s currently 40%. And the prospect [is that] over the next 10 years, that number is going to grow to 50-55% with Latinos leading the way in overall population growth. When you look at the growth in the population over the last decade, 73% has been ethnic consumers. The bulk of that growth has been Latinos and African Americans.

“The point being:” he continues, “We just can’t have Caucasian stars on our network stations. We think it’s important to have a good mix to speak to all consumers.”

Black celebrity endorsers speak to two objectives: They deliver the message better to black target markets than their white counterparts, and for some, because of their exceptional celebrity status, they effectively communicate to the general market as well.

“We have to develop advertising that speaks well and has relevance to a given target, but not at the expense of other customers,” asserts Rooks. “We try to come up with more broadly appealing advertising and then utilize the celebrity or idea that we think will almost serve as a wink to a given community.” These winks are strategically placed cues that resonate with a particular audience deeper than they would with the general audience.

For example, in the Pepsi commercial called “Barbecue,” the multiplatinum rapper Ludacris (their latest contracted celebrity) intends to leave the gathering with food. Instead he leaves with Pepsi. The wink? If you’re African American, you know that, in general, most people don’t leave a barbecue empty-handed.

“We are the drivers for the trends in the urban market,” explains Phil Salter, creative director at E. Morris Communications. That speaks to considerable consumer leverage, particularly since, in marketing terms, “urban” starts with but does not necessarily end with, “black.” Salter explains that the term “urban” has come to represent a mix of ethnic groups, including whites, who live and/or socialize in urban settings.

“Because African Americans are the drivers,” says Humphries, “the best way to get an accurate message across is to use a symbol of that trend.”

THE MEGADEALS

The top three endorsers–regardless of race–are Jordan, Venus, and Woods. Washington notes, at that level, “They are popular figures who happen to be black. The black part does, however, help in their popularity.”

Much of the fanfare surrounding Woods and Venus is that they are dominating sports that are predominantly and historically white (golf and tennis), which means they also have great stories that can significantly impact an endorsement.

For Avon Products Inc., Venus and Serena not only deliver the powerful message of sisterhood, which was a main thrust of their “Let’s Talk” campaign, but the stories of their success on and off the court were very attractive to this 115-year-old international beauty company that signed the sisters to a deal making them its first-ever celebrity spokespersons.

“They embody the whole idea of a warm, loving, caring relationship [between sisters],” explains Janice Spector, vice president of advertising at Avon. “They’re really a contemporary representation of the beauty world and what’s beautiful.”

Tiger fever has not only pushed golf’s TV ratings to an all-time high, Nike golf balls, since the company signed Woods in 1996, have seen a $50 million revenue growth. Nike’s golf line grossed more than $250 million in annual sales.

“He’s definitely influenced sales,” remarks Kel Devlin, director of sports marketing for Nike Golf in Beaverton, Oregon. “There was a great deal of speculation with Nike getting into the golf business. [Some thought] that it wasn’t going to be authentic, but I think we’ve proven people wrong and Tiger has definitely been the foil for us to do that. We were able to grow at a time when the rest of the industry was flat.”

Woods’ first contract with Nike was worth $40 million. In 2000 he renegotiated a five-year contract estimated at $125 million.

“You can’t always believe the numbers you hear,” cautions Devlin. “We don’t talk about the terms of the deal or compensation. It’s a very important investment for us to have him.

“There are numerous factors we look at to [determine] if the athletes are Nike guys [or girls],” explains Devlin. “Obviously, if they’re the best in their sport, they’re somebody we definitely want to be associated with. Tiger’s record as a junior and as an amateur was arguably better than anybody else’s who has played the game. Everybody [at Nike] thought this guy was going to be someone special and he’s turned out to be incredibly special.”

Jordan often gets credit for pushing the limits on endorsement deals. “Without a doubt,” says Bob Williams, president of Burns Celebrity Sports, a 20-year-old firm that represents companies in sponsorship contracts with celebrities, “Michael made advertisers come to terms with the fact that, in today’s market, consumers are colorblind.” But even more than that, Bob and others agree that Jordan was also very savvy in establishing himself as an effective vehicle for advertisers.

Washington concedes that it was Jordan’s popularity as a pitchman, more than any other factor, that contributed to his marketing appeal.

“A lot of Michael Jordan’s heroic status came from advertising itself,” offers Washington. “More people have seen him in advertising than have ever seen him play basketball. Nike, had become iconoclastic, and their advertising is omnipresent. His commercials made him so popular he was able to secure other commercial deals.”

PITCH BLACK

Black sports celebrities have been dominant among celebrity endorsers for several reasons, with performance topping the list. It’s the reason stars such as Woods, whose endorsements with Nike, Buick, Rolex, Titleist, and American Express will bring him close to $1 billion collectively (according to news sources) when you include his golf winnings; Michael Jordan, whose endorsement deals total more than $40 million; and Venus, who reportedly signed an unprecedented five-year, $40 million contract with Reebok in 2000, have snagged megadeals.

Venus’ deal was brokered by her father, Richard; long-time family associate Larry Bailey, one of the few African American partners at PriceWaterhouseCoopers; and attorney Keven Davis. She has also recently cut deals with Wilsons Leather and Nortel Networks. But their endorsement domination doesn’t end there. There are two other important factors.

Bob attributes most of the growth of African American endorsers in sports to changes in the sports industry that began in the mid-’70s with free agency. Free agency allows an athlete to market himself or herself for the best possible price to any team upon the expiration of a contract.

“It allowed salaries, because of competition, to really increase exponentially. And when the salaries started to go up, the popularity of sports in general started to go up,” he explains. “You had a combustible combination that really spawned the sports marketing industry that we’re in now, and the dollars that athletes earn for endorsements are directly tied to how much they earn on the field.”

Also, for marketers, linking with sports figures provided a quantifiable measure of the dollars a potential advertiser would spend. “If Michael Jordan was on TV for 80 games a year and played for 26 minutes, you could quantify the kind of presence [he had] or the number of impressions,” offers Max Siegal, an African American lawyer and former sports agent. As vice president of the Zomba Music Group and president of Verity Records, he now crafts strategic marketing for the Backstreet Boys, Britney Spears, and Kirk Franklin among others.

The staggering growth of music sales, compounded by synergistic multimedia support, namely music videos, now provide music artists with quantifiable marketing status. “The venues are getting larger and [artists] are getting more dates,” Siegal continues. “On a tour, they know they’re going to sell out and in those arenas they’re going to make a million impressions. Now the advertisers are seeing the value of being able to tap right into a demographic.”

ENDORSERS, BUT NOT ICONS

Washington believes that calling the increase in African American endorsement deals “growth” may be too strong a term. He argues that Halle Berry, Queen Latifah, and Brandy, endorsing Revlon and CoverGirl as women of color, are usually integrated into a cast of models that are predominantly white. “Lauren Hutton and Cheryl Tiegs were spokesmodels. A spokesperson carries the brand. We have not seen a woman of color–in the beauty business–at that icon level. Integration is to add flavor.”

There are some exceptions, however. In 2000, M.A.C., an 18-year-old cosmetic company, signed Blige and Lil’ Kim as spokespersons for its VIVA GLAM line–a general market campaign. And Venus and Serena Williams are the first and only celebrity spokespersons for Avon.

Because of their star appeal, the Williams sisters have considerable leverage in determining not only the types of products they’d like to endorse but also how they are portrayed in those endorsements. “Developing endorsement deals, especially at this level, takes a lot of creative thinking,” says Carlos Fleming, a representative of IMG Sports Management Agency, who has worked on developing deals with the Williams sisters. “While you get a lot of interest [in the sisters], there aren’t a lot of companies that are going to be in a position to develop an endorsement relationship with the girls that’s going to be to their expectation [as well as] something the companies can afford or are willing to pay for.”

In fact, outside of the megadeals–which are sometimes exaggerated for press appeal–no one discusses the terms of a deal. There is no benchmark. “To toss around a $40 million deal at a cocktail party is bragging rights,” says Washington. “After that, who would be impressed by a $2 million or $3 million deal?”

There is another reason endorsement payouts are not discussed, according to Sevina Pegue, a vice president at Burrell Communications Group (No. 3 on the BE ADVERTISING AGENCIES list with $181.6 million in billings) and director of broadcast business and celebrity talent. “[Endorsement contracts] are legal documents. That is confidential information. But also, some celebrities will endorse a product for a lot less than they normally would because they have an affinity with a particular product. You also don’t want to set a precedent because every product has it’s own budget.”

Even still, the advancement of black celebrities as product endorsers should not be ignored or minimized, according to Carol H. Williams, CEO of her self-titled advertising agency in Oakland, California (No. 6 on the BE ADVERTISING AGENCIES list with $72 million in billings). Any increase, however slight, is telling and significant. “There is extremely high recognition in corporate America of how important these spokesmodels are to this younger, urban mind-set because the African American market has more dollars in the market than they’ve ever had,” she explains. “It is important to the overall economy and health of the United States of America, and corporations are looking at ways and avenues to romance that market.

“A lot of companies have recognized entertainment, beverage, fashion, and music [as hotbeds of consumerism and] if they don’t get this dollar, they will not have a business in the future,” Carol Williams relates. “It’s the reason so many mass marketing agencies have become interested in black advertising agencies. It’s why so many mass market advertisers have sought to own these properties, so they can say they have an expertise [in minority marketing] and keep that dollar.”

She also believes that just as much as the African American demographic is leading in terms of spending, they are also making better decisions about how and with whom to spend their money.

Tom Joyner, host of his syndicated radio show, understands the power and potential of such influence. He says it’s time that more advertisers realize it as well.

“We [The Tom Joyner Morning Show] reach a whole lot of black people on a regular basis,” he states. “And with that reach, we have a responsibility to serve the community.”

Joyner presently has endorsement deals with McDonald’s, Southwest Airlines, General Motors, Coca-Cola, Nokia, and Kmart, all of which contribute to HBCUs (Historically Black Colleges and Universities) through The Tom Joyner Foundation.

“With Oldsmobile, we pushed voter registration and gave away cars to people who registered,” he says. The campaign, which ran for three years, was called Oldsmobile Drives the Vote. “And sure enough the needle moved,” comments Joyner on the number of Oldsmobiles purchased. “Oldsmobile went from obscurity among black people to being No. 3 among black people.

“Others are beginning to realize that there’s a market out there and not to take it for granted,” Joyner continues. He tells companies, “If you want your share of it, you’ve got to tell these people that you really want and appreciate their business. The smart ones are doing it.”

Who makes up BE’s Top 10 Celebrity Endorsers list? We culled information from advertising agencies, marketers, agents, and news sources to determine the biggest and most influential players.

star power

(1) TIGER WOODS

Having taken endorsement deal negotiations into the next stratosphere, he has re-energized the sport of golf and the sale of its products at the same time. He speaks for Nike, Titleist Buick, American Express, and Rolex among others. It is estimated that he averages $54 million in endorsements a year.

(2) VENUS WILLIAMS

Women receive marginal recognition in sports as endorsers. This tennis dynamo has achieved two firsts: receiving a $40 million contract from Reebok, the largest amount ever paid to a female athlete; and leading the “Let’s Talk” campaign with sister Serena as the first celebrity spokespeople for Avon.

(3) MICHAEL JORDAN

He’s granddaddy of the endorsement deals. Name the category. Jordan’s endorsed everything from sporting goods to men’s cologne–successfully and without overexposure or blurring brands. A savvy businessman as well as champion baller, he still has marketing appeal and averages $40 million a year.

(4) SHAQUILLE O’NEAL

He’s a dominant player with a clean image and a solid history on the courts. That continues to be a draw for marketers. He has endorsed a number of products including Pepsi, Reebok, and Taco Bell. His current endorsements are Swatch, Nestle’s Crunch, Starter, Radio Shack, and Burger King.

(5) ALLEN IVERSON

Considered a “bad boy” in the NBA, questionable images usually don’t fly with marketers. But even with current legal issues, he is so baaad on the court and so popular with the youth, advertisers can no longer ignore his appeal. His $100 million lifetime Reebok deal is a strong indication that he is bankable.

(6) KOBE BRYANT

Like Jordan, he brings the ratings. Like O’Neal, marketers–and consumers–like him. But the L.A. Lakers guard has a reassuring style, good looks, and presence all his own that could seal a future of lucrative contracts. His endorsement deals already include McDonald’s, Spalding, Adidas, and Sprite.

(7) SERENA WILLIAMS

With her sister, Venus, she has already positioned herself as a power broker in endorsement negotiations with Avon and Wrigley’s. After rejecting Puma’s flat fee deal, she negotiated payment to tie directly to her ranking. She was ranked at 400 then. Today (at this writing) she is No. 1.

(8) GEORGE FOREMAN

You believe him when he talks to you and you believe he’s talking directly to you. The Meineke spokesman has had contracts with a variety of fast food companies and has sold more than 10 million Lean Mean Fat-Reducing Grilling Machines since signing with the manufacturing company.

(9) JAMES EARL JONES

The voice of Verizon, he’s one of a select group of celebrities whose voice carries as much–or more–recognition (and therefore, worth) than his presence He also reminds millions of television viewers that they are tuned into CNN, the cable news network of AOL Time Warner.

(10) TOM JOYNER

The popular talk show host draws ratings, crowds, and is a motivator. Therefore, he’s selective, which spikes the potential for his worth as an endorser. Many of his contracts have been negotiated to also support his foundations. His endorsements include McDonald’s and Nokia.

the people’s choice

the editors of BLACK ENTERPRISE received 1,000 responses to a survey gauging the preferences for black celebrity endorsers that was posted on www.blackenter prise.com. The survey listed 20 African American celebrities with current endorsement deals, and the responses were organized into four categories: I am familiar with this celebrity; I consider this celebrity one of my favorites; I feel this celebrity is credible; I am more likely to purchase a product endorsed by this celebrity. Then we added up the scores from all four response categories to produce an overall ranking.

Sixty-four point seven percent (64.7%) of those surveyed felt that credibility was the most important factor in a celebrity endorser’s ability to influence purchase decisions. Second was familiarity with 19.4%, and popularity accounted for 5% of responses. The other 10.9% reflected various responses but included factors such as the integrity of the celebrity and consumer opinion of the product.

There were also varying scores per celebrity within the four response categories. For example, while Tom Joyner is not the most familiar celebrity on the list, he scored highly in popularity, credibility, and influence. Seventy-one percent (71%) of the participants are familiar with Lil’ Kim, but she rated last in the three other categories. Halle Berry and Venus and Serena Williams ranked highly in all categories.

We also asked respondents to select celebrities who were not listed, whom they felt would be credible endorsers. Denzel Washington led the list with 32.9% of the responses, followed by Oprah Winfrey with 19.1%.

1 MICHAEL JORDAN

2 HALLE BERRY

3 TOM JOYNER

4 TIGER WOODS

5 VENUS WILLIAMS

6 SERENA WILLIAMS

7 CEDRIC THE ENTERTAINER

8 GEORGE FOREMAN

9 MARY J. BLIGE

10 SHAQUILLE O’NEAL

(2) HALLE BERRY

Hollywood stars will usually snub their noses at endorsement opportunities, but Halle Berry’s track record shows that she’ll try it all. Having endorsed Revlon, Pepsi, and M&M’s, and riding high off her recent Oscar win, Berry could be a top seller for our respondents. She placed second only to Michael Jordan.

(7) CEDRIC THE ENTERTAINER

He’s familiar to African Americans as a stand-up comedian and for his role on The Steve Harvey Show, but it was The Kings of Comedy that angled him into the national spotlight. His Bud Light endorsement contract is targeted to the general market. Ranked No. 7, he could be entertaining more endorsements.

(9) MARY J. BLIGE

In the transient world of hip-hop stardom, Mary J. Blige has enjoyed a solid 10 years of platinum successes. It has no doubt made her attractive to several marketers. Having endorsed Pepsi, Dark & Lovely, and the MAC Viva Glare cosmetic line, the reigning queen of hip-hop soul also struck a high note with respondents. She ranked No. 9.

DENZEL WASHINGTON

Although Denzel Washington hasn’t thus far endorsed any products, he was overwhelmingly the No. 1 write-in choice of celebrities you would like to see endorsing a product. He has been known to appear on television promoting the Boys & Girls’ Clubs of America, but that’s about it. His clean, solid image resonates with our voters.

COPYRIGHT 2002 Earl G. Graves Publishing Co., Inc.

COPYRIGHT 2003 Gale Group