SB MS Culturally Sensitive

[Marketing & Selling]

Smart Business: Local Celebrity Spokespeople

Hed: Seeing Stars

Deck: Spice up your advertising with local celebrities.

Pull quote: “We needed name recognition from the get-go to set us apart from our competition so people would think we were bigger than we are.” Norm Bastin, President/CEO, Online Asset Exchange

TEXT:

After winning back-to-back Super Bowls, Denver Broncos players were some of the most recognizable people in Colorado. So when Boyd Hoback, president and CEO of Good Times Hamburgers decided to beef up his advertising by moving into television commercials, he took a chance and hired a local celebrity as his spokesperson – Shannon Sharpe, the team's tight end.

Nearly everyone in the state knew Sharpe from his mouthy and often hilarious antics both on and off the fifty-yard line. When the football player began appearing in television ads for Good Times, sales increased by 15 percent for the small Golden, Colo., fast-food chain. Hiring a local celebrity to pitch burgers was a smart move for Hoback.

Connect the Brand

Smaller companies like Good Times can’t always afford to hire big-name celebrities to endorse their brands but know the selling power of a recognizable spokesperson can be invaluable to revenues. As a result, some businesses are turning to local celebrities or working out creative arrangements with nationally known celebrities in an effort to build their brand.

Hoback chose Sharpe for several reasons: recognizability, reputation, personality and price. “Sports stars price themselves,” says Hoback. “There was no way we could afford a John Elway or Terrell Davis, but Sharpe was in our price range, had a good reputation and an irreverent personality that matched ours. We felt people would connect him with our brand pretty easily. Using him gave our chain credibility we hadn’t had before.”

It also attracted a younger clientele raised on McDonald’s and Burger King but willing to try something new and hip. A local advertising agency handled negotiations for Good Times and oversaw the commercial shoots. Hoback declined to name the fee paid to Sharpe, but says he used him in two sets of ads and paid Sharpe a flat fee for each set. The ads ran for nearly a year, with the first set pushing about two-thirds of the overall increase in sales.

Peter Schaffer, advertising executive with All Pro Sports and Entertainment in Denver, says there can be strong benefits to small companies using local celebrities in ads. “Small business needs to compete with large business without the budget,” he says. “Athletes, for example, give exposure and name recognition far beyond the ads they appear in because they’re in the newspaper every day during their season.”

Paying for the celebrity – whether it be an athlete, news anchor, etc. – is not the major expense in television advertising, says Schaffer. “You can pay from $10,000 to $200,000 for an athlete,” he says. “But the majority of your expense will be in the creation of the commercial and the media buy.” Depending upon the media market and quality of the commercial, he says, those expenses can run from $5,000 into the hundreds of thousands of dollars.

Add Validity

So maybe you can afford to pay the celebrity but more money just isn’t in the budget for TV ads? Walter Williams, owner of Coldwell Banker Walter Williams in Jacksonville, Fla., had that problem. He turned to radio for his celebrity spokesperson.

Arthur Crofton is a likable, respected morning radio show host on Jacksonville’s 96.1 FM. His ratings remain steadily high, so when Williams’ marketing firm suggested the real estate company use Crofton in a radio advertising campaign, the broker decided to give it a shot. Nearly five years later, the company and Crofton are still a team. The main reason, says Williams, is because Crofton projects an honest, stable image for his company, which the realtor feels is important to his clients.

Like Hoback, Williams also negotiated a mutually agreeable fee for his celebrity. He declined to state the fee, though he says it fits easily within his marketing budget. “You’ve got to look at what you can afford,” he says. “Prioritize and stay on budget.”

For Williams’ money, reminders about his firm are gently pounded into listener ears on a daily basis. Crofton talks up the real estate company’s campaigns, describes current listings and gives glowing recommendations of individual realtors. If the company wins trips from meeting sales goals, it takes Crofton along as a bonus, furthering the relationship between spokesperson and employer.

“Arthur adds validity to our company,” says Williams. “When I say we’re great, it’s not as believable as when he says it. People listen to Arthur.”

Get the Right Person

In advertising, creativity is the name of the game. Radio spokespeople can be more reasonable to obtain than athletes or TV personalities since their fees range anywhere from $50 on up per appearance or plug, depending on the market. But cash doesn’t always have to be the bargaining chip.

In San Diego, Norm Bastin was launching his fourth startup in 1999, Online Asset Exchange, an online marketplace for used industrial assets, when he got creative with his advertising. Bastin, the company’s President and CEO, knew he needed do something big to get attention for his business and build its brand quickly.

“We wanted people to know we were a real player,” he says. “We needed name recognition from the get-go to set us apart from our competition so people would think we were bigger than we are.”

With his partner, Bastin started brainstorming on a grand scale. The two created a long list of “dream” spokespeople. Lee Iaccoca, the former Chrysler chairman who brought the automobile company back from the brink of failure, was at the top of the list. Iaccoca, they felt, was a savvy businessman who was recognized worldwide. Although semi-retired, Iaccoca remained active in the business community. Online Asset Exchange was convinced an association with a highly visible, no-nonsense businessman would give them instant authority and stature among the B2B market it targeted. The only problem? No budget to hire such a high-profile spokesperson.

Undaunted, the co-founders worked their connections and landed a meeting with the business guru. “We pitched him as we would any other investor,” Bastin says. “We convinced him that his background at Chrysler fit Online Asset Exchange and he liked what we were doing enough to work out a deal with us.”

In January 2000, Iaccoca agreed to become the spokesperson for the fledgling Internet startup in return for a minority piece of the company and a seat on the board of directors. No money changed hands. Iaccoca lends his name and likeness to the company and appears in radio and television ads as well. Bastin is thrilled with the coup and says whenever he hands out his business cards, he immediately hears comments indicating instant recognition of his company. Remarks such as “Oh, yeah, that’s Lee’s company,” says Bastin, show that his celebrity choice and creative deal-making is giving him the branding he was after.

Spicing up your marketing efforts, say these business owners, is often just a matter of thinking creatively and taking a chance.

SIDEBAR

Star Power

If you’re thinking of hiring a spokesperson, the business owners mentioned above have a few tips for you.

Create a budget and stick to it. “Look at only what you can afford,” says Williams.
Don’t get star struck. Take the time to hire the right person by determining the image you want to project for your company and the audience you’re targeting. An irreverent, hip Shannon Sharpe, for example, wouldn’t have worked well for Good Times if the company was trying to project a conservative image or was pursuing the senior citizen market. “You’re wasting your money if it’s not the right person for your company,” says Bastin.
Carefully consider the medium. “It’s harder to use a celebrity on the radio,” says Hoback. “Shannon wouldn’t have worked out with radio ads.”
Know your market. Does your advertising need to reach a town, a state or even go worldwide? Staying local can often be the perfect choice, says Williams, because ideally your customers already know and trust your spokesperson.
Watch out for the monster celebrity. “A celebrity can become more important than your brand in the public’s eye,” says Hoback. “That’s dangerous.” Hoback advises limiting the length of the campaign to avoid creating an advertising monster that overpowers your message. And if your celebrity winds up in the front pages as a result of unsavory activities (consider the previously clean-cut O.J. Simpson turned murder suspect) cut your losses immediately, he says, and get the ads out of the public eye as quickly as possible.
Create a believable message. Use an advertising or marketing firm to help you, advise Bastin, Hoback and Williams. Such firms can also provide damage-control assistance if you wind up in the monster celebrity scenario above.