Will Chris Brown Slow the Tempo of Artist Endorsements?

Execs Say Less-Celebrified Ads During Grammys Shows Media-Buying Shift

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According to an analysis by GreenLight, this year's Grammy telecast could be a milestone in the decline of celebrity endorsements. In the media and talent rights clearinghouse's first analysis of the ads, these types of commercial messages declined by 46% this year, while the use of licensed "contemporary or iconic" tunes increased slightly.

GreenLight Grammy Report

Read GreenLight's Ad Gauge of this year's Grammys.
According to GreenLight's Grammy AdGauge data, ads during the Grammy broadcast featuring celebrity endorsements slid from 21% of spots in 2007 to 13% last year. In the 2009 broadcast, only 7% of spots had a celebrity endorser, excluding ads for recordings and movie trailers.

"What you're seeing is that [advertisers] are still willing to pay for music because they think it resonates on a number of levels," David Reeder, vice president of GreenLight, says. "But up-and-comers are cheaper and less of an investment than someone like Chris Brown. Those are the kinds of choices people are going to make, and they're less willing to put all of their eggs into one celebrity or musician."

It's unclear how long the taste of recent troubles with Michael Phelps and Mr. Brown will linger in marketers' mouths, but, with ROI for celebrity endorsements under continuing pressure and with many celebrity-branded retail lines suffering, the GreenLight data may lead some to conclude these types of high-profile campaigns are on the wane.

However, some in the business of making celebrity deals, such as David Schwab, managing director of Octagon First Call, say the drop in celebrity endorsements reflects a shift in media buying more than campaign strategy.

"What that data accounts for is definitely a shift of media dollars with how a brand is going to spend their money in the entertainment space, and that's a decision made way before they decide which musicians to use," Mr. Schwab says. "We're engaged in multiple conversations with brands in which the only component is PR and viral. People are just trying to do different things and stretch dollars."

Mike Heller, founder and CEO of celebrity marketing and strategy agency Talent Resources, echoed this notion and faulted the Grammys for attracting less advertiser interest than in previous years.

"Clients that I've talked to would rather expose their products on the night of the Super Bowl and the Oscars, if they had a choice," Mr. Heller says. "A couple years ago, they would have picked them all, but the Grammys have declined in prestige since then."

This year's broadcast on CBS had a 17% bigger audience than last year's, which had the second-worst ratings in Grammy history. That translated to 19 million viewers this year, which was a relative turnaround but well shy of last year's Academy Awards, which notched 32 million viewers in a record low.

The 2009 Grammys will be remembered most for what people didn't see: Chris Brown and Rihanna's canceled performance after a violent altercation the previous night. The R&B star was charged with felony criminal threats on Feb. 8, and, according to the Los Angeles Times, his girlfriend and alleged victim Rihanna is helping prosecutors build a domestic violence case against him. On Feb. 9, Wrigley suspended its Doublemint campaign that featured Mr. Brown and his branded song "Forever."

Mr. Heller says that musician shenanigans may be getting a lot of attention these days, but celebrity misbehavior is cyclical. "Two years ago, it was pop celebrities like Britney Spears, Paris Hilton, etc. getting arrested. Those people are the ones who are the trouble makers. Now you see Chris Brown."

"Every time something like this happens, people just spend more time doing due diligence, and the legal language gets tighter," Octagon's Mr. Schwab says. "Brands won't get out of this space. People that are interested in this space know what they're getting into."

Endorsement contracts usually have "morality clauses" that allow a marketer to bail, Mr. Heller says, and the multiplatform benefits of using musicians representing brands far outweighs the risks. Plus, musician celebs are still some of the most recognizable faces for international campaigns.

Between 2007 and 2008's Grammys, licensed songs dropped as quickly as celebrity endorsements, but this year licensed music halted the decline and improved slightly. GreenLight's Mr. Reeder says this had a lot to do with marketers shying away from marquee singles and relying more on cheaper, less-established (and un-branded) bands from which to license music.

Some have argued that custom, branded music provides the best brand-value, but advertisers still don't think so, at least when it comes to the Grammys. While a full quarter of ads used familiar licensed music, the survey showed just 2% of all Grammy ads had "traditional jingles," a number that's remained flat since last year.

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