Monday Marketing Minute: What We Learned About Marketing Strategy From Paula Deen

Posted by DC Marketing Pro on July 1, 2013 at 10:59 AM

Here's this week's DC Marketing Pro’s Monday describe the imageMarketing Minute, a weekly feature that provides interesting and insightful marketing information, written to be read in a “minute.”  We start off each week publishing a nugget about a marketing trend, an interesting marketing quote or relevant marketing article. 

Here is your July 1st Monday Marketing Minute:

Recently, the news has been filled with reports of corporate sponsor after corporate sponsor dropping their association with Paula Deen in light of her admission that she has used a racial slur.  As of July 1st, the list of companies dropping their association with her includes Sears, Walmart, JCPenny, Walgreens, Target, Home Depot, QVC, Caesars Entertainment, Smithfield Foods and the Food Network.

“Borrowed Equity” is the marketing term used to describe the effect a celebrity endorsement or celebrity association has on a product.  When the celebrity provides a positive association, the benefits can be massive, but how do you measure the negative effect on a product when the celebrity pulls a Paula Deen?

If you are looking for a marketing case study to evaluate, look no further than Nike.  There haven’t been much bigger celebrity scandals than Tiger Woods, which is now about 4 years old.  Add in Lance Armstrong and Oscar Pistorius and you would assume Nike’s sales would’ve taken a hit.  Or maybe not?  The image of Nike may have taken a temporary hit, but if sales held steady or went up, could that be the result of all the additional exposure Nike received?  Consumers understand that Nike wasn’t behind Tiger Woods' infidelity and Nike didn’t encourage Lance Armstrong to cheat.  Does “guilt by association” apply in these cases?  If not, then the amount of unpaid advertising Nike received would be measured in the MILLIONS!

What do you think?  Is the value of aligning with a celebrity endorser worth the potential risk?  Or is there really a risk, considering that if/when they made a mistake and you drop them…and in the process actually looking GOOD because you are dropping them?

These are the marketing questions to consider when using a celebrity endorser.  We would like your opinion.  Post your comments below.  If you like the Monday Marketing Minute, subscribe to our blog and we will email this and other marketing articles directly to you.



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Tags: Trends, Marketing Strategy



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