Monthly Archives: September 2010

Celebrity Endorsements: Risky Business or Rewarding Endeavor?

When you think about Oreos, what comes to mind? America’s favorite cookie? Check. Glass of milk? Most definitely. Shaquille O’Neal? Not so much.

Well, Kraft Foods begs to differ. Just last week, Kraft released a 30-second commercial in which Shaq is teamed with Eli Manning, Venus Williams, and Apolo Ohno to defeat the mysterious “hooded menace” who threatens to overtake the affectionately termed Double Stuf Racing League (DSRL).

One would think that companies would be reluctant to pair up with a celebrity after the infamous “crash heard ‘round the world” and resulting backlash towards golf-legend Tiger Woods. Such is not the case, it seems. Agents and CMOs (Chief Marketing Officers) will always get starry-eyed by the big names of “celebrity” because 1) brands love endorsements, and 2) consumers buy into “celebrity.”

Companies recognize the risk that comes with choosing the celebrity-endorsement approach; many have learned the hard way that it becomes a reflection of their brand. Putting a face to a name makes the brand recognizable; more so when that face is famous. According to Anita Elberse, associate professor at Harvard Business School, some companies have seen their stock increase by .25% on the day an endorsement deal was announced. That doesn’t mean that every brand needs a celebrity-endorser; it has to be relevant to both the brand and the consumer.

However, celebrity endorsement is always worth investing in if you have the right person.

International pop star Lady Gaga is set to revive the instant camera for Polaroid as its Chief Creative Officer.

Teen singing sensation Justin Bieber lends his famous hair and unblemished face to Proactiv.

New England Patriots Quarterback Tom Brady relies on Smart Water when hitting the gym to train for (hopefully) another Super Bowl appearance.

According to marketing research firm Millward Brown, U.S. celebrities show up in more than 15% of advertisements. Not all of the appearances are in front of the camera, mind you. Sometimes, all a celebrity needs to do is be seen toting around a product or updating their Twitter account with a simple 140-character tweet.

American socialite Kim Kardashian spotted with an exclusive Hermès Birkin bag.

That 70’s Show actor Ashton Kutcher tweeted behind-the-scenes details about Popchips (snack food item).

Celebrities generate gossip and gossip requires word-of-mouth communication. If consumers are talking about a celebrity and can link him or her back to a brand, the emotional connection or self-expressive benefit that consumers feel for / towards the celebrity is transferred onto that brand. As you can see, this is 50/50 chance that marketers must gamble on. When a celebrity behaves (Shaq), the brand (Oreo) does well. But, in the case of celebrity misbehavior (*cough* Tiger Woods *cough*), the brand (Accenture, Nike, Tag Heuer) suffers.

With that said, reports show that celebrities still push products. But the question that marketers need to ask of consumers is: Would you buy a product based on a celebrity endorsement?

Written by Vicki Truong

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iPhone vs. Android: Which Phone Should You Choose?

Since 2007, Apple’s iPhone has dominated the cell phone market with its innovative and user-friendly design and style. AT&T is the service carrier that provides phone service to the iPhone, boosting sales a considerable amount and allowing AT&T to closely compete with Verizon and Sprint. Apple’s initial advertising campaign that introduced the iPhone first aired before the phone’s Jun 29th launch. Considering this was the only phone of its kind at the time, the campaign was extremely successful; the commercial was simple yet effective. With a black backdrop, it displayed only a person’s hand holding an iPhone, and visually illustrated how one would use the phone, its different capabilities such as email, web surfing, photo storage and how fast and easy it was to use. I remembered first seeing these commercials and reacting with awe, thinking to myself, “WOW! I have never seen anything like this. That is such a cool phone!”

The first day the iPhone went on sale, the advertising campaign’s outcome proved strong with thousands of people from across the country waiting patiently for hours outside of Apple stores to be one of the first people to purchase this new piece of innovative technology. Since 2007, Apple has sold several million iPhones worldwide and has released new, upgraded versions as well. The 3GS iPhone came out in 2009 and this year, the iPhone 4G was released.

The Android phone was introduced by Verizon in October of 2009 to compete with Apple’s iPhone. Google and Verizon collaborated to make a brand new phone, similar to the iPhone, with fast 3G network coverage in order for Verizon to compete with AT&T in the touch screen phone market. The Android, like the iPhone, is operated by a touch screen, internet accessible, email compatible and has thousands of different applications one can add to their phone.

The advertising campaign Verizon used was very sharp, bold and to the point. The Motorola “iDon’t, Droid Does” campaign directly attacks the iPhone by stating all of its flaws, and then points out that the “Droid Does” do all of these things.

Some of the phrases used in the “iDon’t” commercial are the following:

“iDon’t have a real keyboard”

“iDon’t run simultaneous apps”

“iDon’t customize”

“iDon’t run open development”

These are extremely strong allegations that Verizon boldly states in their commercials, and as a result, Verizon has won over many consumers over the past 11 months. In the first 74 days, 1.05 million Motorola Droids were sold, exceeding the iPhone’s initial release sales numbers when it first came out in 2007.

Another technique Verizon used to advertise the Android was institute the “Droid Does Times Square” campaign. People on the street were introduced to an interactive experience where a Droid was hooked up to the electronic billboards in Times Square, and by using the voice command feature, the Droid was able to control the huge billboards. This was extremely useful and productive; people became familiar with the new Verizon product and became excited for its release.

Verizon vs. AT&T

Before deciding on whether the Droid or iPhone is right for you, it is important to take into consideration which network provides the best coverage. Verizon Wireless has the best coverage in the United States, while AT&T has received constant complaints about dropped calls and lack of service in some areas. However, since AT&T uses a standard phone service, the iPhone can be used globally and not just domestically.

In 2007, AT&T had approximately 65 million wireless phone users where as today, it provides about 87 million people with wireless cell phone services. Verizon had 63.3 million users in 2007 and now has 92.8 million users, approximately six (6) million more than AT&T. (Cox, Network World) Verizon is the leader in the United States wireless phone market ahead of AT&T.

Now which phone will you choose? Will you pick the iPhone with the so-so AT&T service that has millions of different apps to choose from, or the Droid that is up and coming into the market and uses Verizon, which has the best coverage in the United States? Only time will tell which one of these companies will be the most successful in the long run, but the question is, which team will you play for?

Written by: Adriana Mirra

Move Over Marty McFly…

When you think “flying car” what first comes to mind? What about 135 miles per gallon? Impossible?  Well if you happened to watch last night’s Chronicle, you would think differently.

Last night, Chronicle aired a special detailing the evolution of the car, especially focusing on today’s advancement in technology. The electric car is a new trend that many automobile manufacturers are now delving into. With the increasing problem of global warming and expensive gas, these technological advancements are key.

In the past, people have shied away from the use of electric motors because of several concerns. The miles between charges were far fewer than that of a gas car and charging your electric motor took hours rather than the 5 minutes it takes to fill up your gas tank.

The picture above compares and contrasts the electric and gas motors. As you can see, the obvious efficiency gas has over electric can explain why manufacturers have chosen not to pursue the technology, however times are a-changin…

Meet the Roadster 2.5.

Developed by Tesla, this gorgeous automobile runs entirely on electric power. However, unlike electric cars of its past, the Roadster 2.5 goes from 0 to 60 in about 3.7 seconds and gets about 245 miles between charges, FAR more than an regular citizen drives during a day. Plus, it only takes about 3 hours to recharge. If you compare this car to regular gas powered cars, it would get about 135 miles per gallon. An added plus is low maintenance. An electric car has about 10% of the moving parts a regular car has. That means no oil changes, or belt and filter replacements. The only draw back? The price. This baby comes with a $109,000 price tag and while a low priced sedan is in the works, this eco-friendly beauty does not come cheap.

Hybrids and crossovers, in addition to fully electric, are becoming the new frontier for the automobile industry, but why not go further…

This is definitely what you think it is and no, it is not a movie prop. It is Terrafugia’s Flying Car. Developed by MIT Scientists, it is projected to be available in late 2011. Although the craft operates using regular gasoline, on the road it gets about 30-40 miles per gallon and much better mileage in the air.

Advancements in the automotive industry are certainly impression. With the increasing importance to turn to cleaner sources of energy, it is very encouraging to see such successes in using electric motors. Although the technology can be expensive, I have no doubt that incentives will be put into place to encourage the purchases of these vehicles (much like with hybrids). It was not too long ago that the American automotive industry was in serious trouble, and perhaps these new advancements are what the industry needs to bounce back to their old glory.

So… who knows what future generations will be cruising around in but right now I’m half-expecting Doc Brown to appear in his DeLorean because apparently where we’re going, we don’t need roads…

Written by Caitlin McDonough