What are Endorsements in Marketing? Definition & Guide - BMB

What is an endorsement? Often the key element in an advertisement or marketing campaign, a product endorsement is a public declaration from ... Home Articles SubscribetoBMB About Contact EndorsementsinMarketing byColinFinkle|Nov28,2019|BrandingDefinitions|2comments DefiningEndorsementMarketingandaguidetowhen/howtouseendorsementstobuildyourbrand. Endorsementsarealargepartofmarketing.Purportedly28%ofNike’senormousmarketingbudgetgoestoathletestosecuretheirendorsements.Weseefamousfacesontheadsandpackagingfromeverythingfrombedsheetstocereal.Andnow,socialmediaandinfluencershavetakenittoanotherlevel;KimKardashiangetspaid$250,000perphotoendorsingaproductonherInstagramaccount. Butmarketersandendorsersoftenfailtotrulyunderstandtheconceptofendorsement.Mostdonotknowhowtouseendorsementseffectivelyandlegally.Theydon’tknowthenatureandethicsaroundpayinginfluentialpeopletosteertheirfanstoaproductorservice. Solet’sbackupandstartfromthe basics. Whatisanendorsement?Oftenthekeyelementinanadvertisementormarketingcampaign,aproductendorsementisapublicdeclarationfromapersonororganizationinsupportofaproduct’sfeatures,quality,benefits,and/orbrand. Anendorsementcanbeeitherpaidorunpaid.Whenwethinkofendorsements,mostpeoplethinkaboutathletesorcelebritiespaidbigbuckstoendorseabrand.Butthevastmajorityofendorsementsareunpaid. Five-starproductreviewsonAmazonorothere-commerceorsocialmediawebsitesareendorsements.Anendorsementcanalsobeapositiveratingfromacertificationorganization,suchasaTopSafetyPickfromtheIIHSforavehicleoranAAAratingfromStandard&Poorsforabond.Evensomeonewalkingdownthestreetwearingat-shirtwithalogoisatypeofendorsement! Solicitingendorsementisanessential tacticforbuildingeverybrand.Endorsements,eitherpaidorunpaid,needto bepartofeverybrand’smarketingmix. PROMOTION EndorsedMarketing Wearesocialcreatures.Welookat whatthepeoplearoundusaredoingtogetcluesaboutwhatweshouldbedoing. Wetakespecialnoticeofpeopleweconsiderexpertsorleaders.Itisencoded inourbiologythroughevolution. Givenoursocialnature,itshouldbenosurprisethatendorsementsareextremelyusefultoolswhenmarketingaproduct.Peoplearegoingtolooktofriends,experts,andinfluentialpeoplewhenitcomestowhatproductstheychoosetobuy,whatorganizationstheydonateto,orwhotheyvotefor.Endorsementsaresocialproofoftheusefulnessofsomethingorsomeone. Anendorsementofanypublicstatement thatespousesthevirtuesofaproduct. Anendorsementisalwayspublic,meaningthatpotentiallyanyonecanhearit.Thepersonendorsingtheproductcantexpectittobeaprivatestatementtobeanendorsement.Aprivatecommentaboutaproducttheythinkisvaluableiscalledarecommendation. Thedistinctionbetweenendorsementsandprivaterecommendationsiscriticaltokeepinmindbecausepeoplewilltalkpositivelyaboutthingsinprivatethattheymaynotfeelcomfortabletoinpublic. Thedifferencebetweenendorsementsandrecommendationsisespeciallyclearinpolitics.Peoplewillpubliclysupportonecandidateorpolicy,andthensaytheirrealviewsinprivateorwhentheyvote. Peopleconsidertheirreputationswhentheymakeendorsements.Ifaclientsayssomethinginsupportofyourproducttoyou,youcannotpublishthatasanendorsementonyourwebsite,brochure,oradvertisementwithouttheirexpressedconsent. Anendorsementisalwayspositive.If itwerenegative,thenitwouldbeadenouncement. Anendorsementcancomefromeitheranindividualoranorganizedgroupofpeople.Forexample,SauconyhasrunningshoesthatareendorsedbybothParkerStinson,Americanrecord-holdingrunner,(anindividual)andtheAPMA,AmericanPodiatricMedicalAssociation,(anorganization). Individualsthatcommonlyendorseproductsare: CelebritiesorInfluencersAthletesExpertsMediareviewersProductUsers Groupsthatendorseproductsare: ProfessionalAssociationsSafetyBoardsEnvironmentalAgenciesNon-GovernmentOrganizations (NGOs) Endorsementscanbeeitherpaidor unpaid. Unpaidendorsementsareprettysimple.Peoplehavefreedomofspeech,sotheycansaywhatevertheywouldlikeaboutaproductwhenevertheywant,upanduntilitislibelous. Butpaidendorsementshavelegalrequirementsforboththeadvertiserandtheendorser.TheFederalTradeCommission(FTC)enforcesthelawsgoverningpaidendorsements. Theregulationsseektolimit confusionbytheend-user;theFTCwantstoensurethatconsumersunderstand thatthewordsoftheendorsermaybeinfluencedbymoneyandthattheendorser doesn’toverstatethebenefitsoftheproductorignoretherisks.Theendorser alsohasthesamelegalrequirementsthatapplytothecompanyiftheywere marketeddirectly. Forexample,KimKardashian-West endorsedpillsonInstagramthatcanhelppregnantwomenwiththesymptomsof morningsickness.TheprescriptionwascalledDiclegisfromaCanadian pharmaceuticalcompany,Duchesnay.Kimsaidithelpedheroutduringher pregnancy. Unfortunately,Kimmadesomemistakesintheoriginalpostthatprompted astronglywordedletterfromtheFederalDrugAssociation(FDA)toDuchesnay. HerInstagrampostshouldhavelistedtherisksandsideeffects,justasany advertisementwould.Shehadprovidedalinkforherfollowerstoapagewith thesideeffect,butthiswasinsufficient.Shehadtoamendherpost. Endorsementscanbequitepowerful.Butyouneedtounderstandthemandthelegalrequirementstousethemeffectively.Wetalkaboutthelegalrequirementslaterinthisguide. PROMOTION PaidEndorsements Paidendorsementsareusuallywhat marketersarereferringtowhentheytalkaboutendorsements. WethinkofendorsementdealslikeNikesignedanagreementwithKevinDurantworthupwardsof$300million.Thereismoneyandanexclusivecontractinvolved.Thedealisasmuchtokeeptheprizedinfluencerfromendorsingthecompetitionasisittosecuretheirendorsement. Butthereareothertypesofpaid endorsements.Apersoncanbepaidfortheirendorsementwithmoney,freegoods orservices,oracombinationofboth. Manymarketersandpublicrelationsprofessionalsgeneratepaidendorsementswithouteversendingacheque;theysendtheirproductsouttoreviewersorinfluentialpeople.Thispracticeisparticularlyprevalentinthetoyindustryandthecosmeticsindustrybecausethemanufacturingcostoftheproductisquitelowrelativetotheprofittobemadeifsomeonewithabroadreachendorsestheproduct. EndorsementsthataremotivatedbyfreestuffarestillconsideredpaidendorsementsbytheFederalTradeCommission(FTC)andarestillunderallofthelegalrequirementsforbothendorsersandadvertisers. Thereisanexception.TheFTCdonotconsideritapaidendorsementconsumersthatchoosetowriteasomethingpositiveoftheirownfreewillaftertheyhavereceivedthefreeproductaspartofasamplingprogramavailabletoallcustomers. CelebrityEndorsements Celebrityendorsementsarethecornerstoneofendorsements.Theyshouldnotworklogically;whywouldacelebrityknowanybetterwhatproductsyoushouldbuy? Butcelebrityendorsementsarebigbusiness.Whenpeopleseetheirfavoritestarendorsingaproduct,theymaytakealookataproducttheyneverconsideredbefore.Endorsementsalsobuildbrandassociationsandthepersonalityofabrand;peoplenaturallyassigntheconfuseofthecelebrityspokespersonwiththebrandtheyareendorsing. ExamplesofCelebrityEndorsements ArianaGrandeendorsesReebok JustinBieberendorsesCalvinKlein KylieJennerendorsesPuma BeyonceendorsesL’Oreal ColinKaepernickendorsesNike EllenDegeneresendorsesCoverGirl GalGadotendorsesHuawei KawhiLeonardendorsesNewBalance MichaelJordanendorsesNike TaylorSwiftendorsesDietCoke PROMOTION Whydocompaniesusecelebrityendorsements? Bigbrandsusecelebrityendorsementsbecauseitbothpromotestheirproductsandincreasesaproduct’sconversionrate(thepercentageofpeoplewhobuyoutofthepeopleexposedtoaproduct).Morepeoplegettoknowabouttheproduct,andthosepeoplearemorelikelytobuywhensomethingisendorsedbysomeonetheyrespect. Celebrityendorsementsmakeaproduct morememorable.Aforgettableproductismadenoteworthywhenyouattacha well-knownfacetoit.Ourbrainsaretunedtopickoutandrememberpeople’s faceseasily. Celebritiescanalsomakean unfamiliarproductmoreapproachablewiththeirendorsement.Wearefamiliar withstars;weseethemonTV,readabouttheminarticles,andfollowthemon socialmedia.Thatfrequencyofcontactmakesthemfeelfamiliar,evenifwehave nevermetthem. Thefamiliarityofacelebritytransferstomakeaproductmorefamiliarandlessintimidated.Thiseffectisparticularlyusefulfornewproductsorexistingproductsenteringanewmarket. HenryCavillendorseHuawei Forexample,Huaweireliesonthe endorsementsofcelebritieslikeGalGadotandHenryCavill.Huaweihasa uniquechallengegivenitsChinesesoundingnameandthefactthatitis relativelynewtowesternconsumersrelativetoothersmartphonemanufacturers likeApple,Google,Samsung,andSony.Theiruseofwell-knowncelebritiesin theiradvertisementsmakesthemseemlessintimidatingbecauseofaphenomenon calledcognitiveeasing(apointwellestablishedontheTechAltarYouTubechannel.) Cognitive easeisourbrain’stendencynottoquestionthingsthatweare exposedtooften;inotherwords,thingsthatwearefamiliarwith.Weapproach unfamiliarthingswithskepticismanddoubt.Butaddafamiliarcelebrityin there,andweapproachaproductwithfarlessreservation. Now,inthesocialmediaera,celebritieshavechannelstocustomersthatmarketerscanpassmessagesthrough…fortherightprice,ofcourse. Untilrecently,ourcontactwithstarswasmediatedbyamediacompanythatwantedmarketerstoadvertiseagainstthecelebritiesprogram.Forexample,aDr.PhilfanwouldwatchCBS,atelevisionchannel. Now,Dr.Philandmostcelebritieshavesocialmediafollowingsthataddvaluetothebrandstheyendorse.Marketersvaluetheadditionalreachthatcomeswithpublicfiguresthathavelargesocialmediafollowings. Arecelebrityendorsementseffective? Yes,celebrityendorsementshavebeenproventobeaneffectivemarketingtactic. Thatresultisalittlealittleperplexing.Wehavepeoplewhosometimeshavenospecializedknowledgeaboutsomethingrecommendingtheproductsforthatthing.Itisalsoanopensecretthatcelebrityrecommendationshavemoretodowiththedollarsinacontractthantheeffectivenessoftheproduct. Soitisfairtoask:docelebrity endorsementsincreasesalesandbrandequity? AstudyoutoftheHarvardBusiness Schoolprovedthattheydo,atleastinthesportsandathleticsindustry.The studycalled“TheEconomicValueofCelebrityEndorsements” wasperformedbyAnitaElberse,aprofessoratHarvard,andJeroenVerleun, thenananalystforBarclays. “[W]efindvalidationfortheuseofcelebrityendorsersasanadvertisingstrategy:afirm’sdecisiontoenlistanathleteendorsergenerallyhasapositivepay-offinbrand-levelsales–inanabsolutesenseandrelativetothefirm’scompetitors–andincreasesthefirm’sstockreturns.”TheEconomicValueofCelebrityEndorsementsbyAnitaElberseandJeroenVerleun ElberseandVerleunstudiedtheeffect ofendorsementsonbothsalesandstockpricesof51publicallytraded companiesthatsellsportsandathleticproducts.TheyuseddatafromNielson’s Homescanpanelforsalesdata.Theycomparedthesalesofbrandsthathad endorsementswithcomparablebrandsthatdidnothaveendorsements. Theyfoundthatanendorsementdid increasesalesbyabout4%. Itisimportanttonotethatmost brands,43ofthe51,sawapositiveeffectfromtheirendorsements.Butafew receivednosalesgrowthfromtheirendorsements,andsomebrandslostsales! Socelebrityendorsementsworkwhen theyaredonesmartly.Thecelebrity’sbrandmustmatchupwithboththe advertiserbrandandthevaluesofthemarket. Iftheendorsementcomesfroman athlete,thenitisalsoimportantthattheywin!Thestudyfoundbetter returnsfortheadvertisingbrandwhentheendorserperformswellinhisorher sport. PROMOTION Docelebrityendorsementsraiseabrandssales,oraproductcategories sales? Celebritieshavethepowertobring attentiontoaproductthatpeoplewouldotherwiseignore.Butdoesthatnew attentionhelpthebrandwhopaidfortheendorsement,ordoesitincreasethe salesofallbrandsinthecategory? WhenKateHudsonmodelsFableticsathleisurewearonherInstagramaccount,doessheincreasedemandforFableticsorathleisureproductsingeneral? Itisanessentialquestionbecause fortheexpensiveendorsementcontractstohaveareturnoninvestment,then thebenefitneedstogotothebrandandnothelpthecompetition. TheHarvardstudybyElberseandVerleunwe referencedearlierprovesthatmostofthebenefitgoestotheendorsedbrand. “Whileendorsementsimprovesalesforthefocalbrands,theydonotmovetheneedleforcompetingbrandsinthecategory.”TheEconomicValueofCelebrityEndorsementsbyAnitaElberseandJeroenVerleun PaidEndorsementsFromOrganizations Forsomereason,paidendorsements fromindividualsseemcredibleforcustomerswhenpaidendorsementsfrom organizationsseemhollowandunconvincing.Buttheyareathing,soIhaveto acknowledgethem. Notethatunpaidendorsementsfrom organizations(likesafetyassociations)arefarmorepowerful,andwecover thoselaterinthearticle. PROMOTION TradeOrganizations Explicitendorsementsusuallycome fromtradeorganizations.Forexample,Oral-Bhassometoothbrushedthatare acceptedbytheAmericanDentalAssociation(ADA). Thesetradeendorsementsarenot simplypay-for-play.Theywouldnotendorseawantinglydeficientproduct.They donotwanttoleadcustomerstobadexperiencesorruinthenameoftheir organization.Boththemanufacturerandthetradespersonservethesamemarket, soitwouldbefoolishtoruintheirrelationshipwiththosecustomers. Butdisplayingthesealsofapproval orlogosofthetradeassociationrequiresalicensingagreement.Thedesigns arethecopyrightortrademarkoftheorganizations,andtheyusuallymakea littlemoneyfortheirorganizationbyrentingouttherighttodisplaythem. Morethanmoney,whattrade organizationsarelookingforistosteerproductdecisionsbythe manufacturer.Theyusuallyhavealistofbestpracticesagreeduponbythe members,andtheywillgivetheirsealofapprovaltoanyproductdesignthat complies. ADASealofAcceptance. Forexample,theADAislookingfor eithermultilayerordiagonallycutbristleswhentheygrantamanual toothbrushwiththeADASealofAcceptance.Thisguidancecome fromascientificstudyprovingtheeffectivenessofdiagonalor multi-layerbristles.TheADAwantstoseetoothcareproductsbeas effectiveaspossible,ratherthanbeascheapaspossibleasthemanufacturers wouldprefer. Tradeorganizationsrarelyexclusively endorsebrandslikecelebritieswould.Anexclusiveendorsementwouldbethe bestwaytomakemoneybutwouldbeagainsttheirorganizationalmissionto helpouttheindustrytheirtradespeopleworkin. Charities Anothertypeoforganizationthat endorsesbrandsisnon-profits.Inexchangeforsupport,somecharitieswill promoteabrand.Thepromotioncanbecontingentonamonetarydonationora donationofproducts. Usually,sponsorshipsofcharitiesare purelypromotionalanddonotcomewithaclearendorsementofabrand’s product.Thecharitywantstoleavethedooropenfordonationsfromother brands. Butsometimessupportdoescomewith anexclusiveendorsement.Forexample,Iworkwithadogfoodbrandthat donatesfoodtoshelters,andmanyofthesheltersdisplayasignsaying “WeFeedAndRecommend”thebrand. DistributorsandRetailers Sometimesthepeoplewhobringthe producttocustomerswillexclusivelysellonebrand’sproducts.Distributors andretailersmaysignanexclusivityagreementwithonebrand.Thisagreement meansthattheywillnotsellanycompetingbrandforanagreed-uponamountof time. Boththeretailerandtheexclusivebrand marketthisagreementasanendorsementtocustomers(“theofficial productof…”). Buttheexclusivityhasmoretodowithbusinessthantheeffectivenessoftheproduct.InBMB’sinvestigationofwhitelabelproducts,wefoundmanyinstancesofretailerssigningexclusiveagreementswithmanufacturerbrandsiftheywouldagreetomanufactureanddistributetheirstorebrandproduct. Retailerswillalsolooktobrandsto splitthecostofinvestmentsinmarketing.Abrandwillpaysomeorallofthe costofapieceofsignageinstoresiftheycanco-promotetheirbrandonthe signage.Theseco-promotionsseemlikeendorsementstothecustomer. ImagecourtesyoftheNewYorkTimes. Forexample,wehavemanyconveniencestoreshereinNorthAmericathathavetheirstorefrontsignwithaCoca-Cola.ThesesignsaretherebecausetheCoca-ColaCompanyhaspaidfortheirsigninexchangeforthepermanentpromotionoftheirbrandinaplacetheircustomerstypicallypurchase. Ihaveworkedwithretailerswhohave customgraphicsappliedtotheirfrontwindows,allpaidforbyamanufacturer whoseproductstheycarry.Itisawin-win.Thestoregetsagreatbranded storefront,andthemanufacturerbrandgetstheirlogoinfrontofcustomersas theywalkintopurchase. PROMOTION FTCRegulationsforPaidEndorsements Itisessentialtounderstandthe legalrequirementsifyouareabrandbuilderwhoislookingtopayfor endorsements. Iamnotalawyer,andthisisnotlegaladvice.IfyouaremarketingintheUS,thenpleasereadtheFTCguidelinesforyourself,orhaveyourlegalrepresentativereaditandcounselyouaccordingly.IfyouareoutsidetheUSormarketoutsidetheUS,makesureyoufollowtheregulationsofyourregion. WhatisconsideredbytheFTCtobeanendorsement? TheFTCconsidersanendorsementtobeanystatementfromordepictionofaperson/organizationthatwouldleadviewersthinkthattheendorserbelievesthatthisproductisthebest. Thatisanexpansivedefinition,and intentionallyso.TheFTCisawarethatless-than-ethicalmarketerswill exploitendorsementsotherwise. Toquotetheregulationsdirectly: “Forpurposesofthispart,anendorsementmeansanyadvertisingmessage(includingverbalstatements,demonstrations,ordepictionsofthename,signature,likenessorotheridentifyingpersonalcharacteristicsofanindividualorthenameorsealofanorganization)thatconsumersarelikelytobelievereflectstheopinions,beliefs,findings,orexperiencesofapartyotherthanthesponsoringadvertiser,eveniftheviewsexpressedbythatpartyareidenticaltothoseofthesponsoringadvertiser.Thepartywhoseopinions,beliefs,findings,orexperiencethemessageappearstoreflectwillbecalledtheendorserandmaybeanindividual,group,orinstitution.”GuidesConcerningtheUseofEndorsementsandTestimonialsinAdvertising,FederalTradeCommission Apublicfigurewhoappearsinan advertisementisconsideredbytheFTCtobeendorsingthatproduct.Evenif thecelebritydoesn’texplicitlystatetheiropinion,thevieweroftheadcan reasonablyinferthatthestarthinkstheproductisfantastic.Therefore,the FTCcountsasanendorsement. Thereisanexceptionforactorsor hostswhoreadadvertisingprovidedcopyfromtheadvertiser.Forexample,an actorplayingacharacterinaskitinavideoad,oraradioorpodcasthost whoreadsanad.Thecontextofthesponsoredsegmentshouldmakeclearthat theopinionsintheadadvertisementdoesnotreflectthepersonalviewsofthe host,andthusisnotanendorsement. Iobservealotofnewmedia celebrities,hostsofpodcastsandYouTubeshowsinparticular,whoadlibtheir adreads.Thisisamistake,asitconfusestheviewerbetweentheirpersonal opinionandtheopinionsoftheadvertiser.Theconflationofopinionscreates liabilityforboththehostandtheadvertiserbecauseitcrossesthelineinto apaidendorsement,whichissubjecttoadditionalregulations. Inanotherexception,theFTCdoesnot consideritapaidendorsementifasocialmediapostofaproductthatsomeone gotforfreethrougharegularconsumerdiscountprogram.Forexample,ifa personclaimsacouponforafreeicecreamconeandthenravesabouttheice creamonsocialmedia. PROMOTION DoestheFTCrequirethatpaidendorsementreflectthepersonal opinionsoftheendorser? Yes.Anendorsementleadspeopleto believethattheendorserlikestheproduct,evenifitisanopensecretthat theyaregettingpaidbytheadvertiser. “Endorsementsmustreflectthehonestopinions,findings,beliefs,orexperienceoftheendorser.”GuidesConcerningtheUseofEndorsementsandTestimonialsinAdvertising,FederalTradeCommission DowereallybelievethatChristianRonaldolovesKFC? SowehavetoassumethatChristianoRonaldojustlovesfriedchickenwhenheendorsesKFC.Itseemsridiculoustome. Marketerscannotputwordsinthe endorser’smouth.Marketersarenotrequiredtorepeatthewordsofendorsement fromthepublicfigureverbatim.Butmarketershavetomakeagoodfaitheffort tomaintainthemeaning,soitstillreflectsthebeliefsoftheendorser. Marketersarelegallyrequiredtomake surethattheendorsementmatchesthecurrentviewofthepublicfigurebefore re-usingitonpiecesofmarketing.Marketershavetocheck-inwiththe endorserregularly,andifnewinformationhascometolightregardingthe effectivenessoftheproductoracompetitor’sproducts. Forexample:ifanathleteendorsesaproteinpowderandthecompanyreformulatestheirproductforanyreason,thenthecompanyneedstoreachouttotheathleteandhavethemexpresstheirendorsementofthereformulatedproduct.Thisisthecaseevenifthenewproductisobjectivelybetterineveryway. Anendorsernotonlyhastherighttochangetheirmind,buttheymightalsohavealegalrequirementtoretracttheirendorsementiftheproductisfoundtobefaulty,dangerous,ormisleading.Theendorserislegallyliableiftheycontinuetorecommendaproductafterapieceofinformationhascomeoutthatpointstotheproductbeingunsafe. FTCsownexampleofthis: “Anadforanacnetreatmentfeaturesadermatologistwhoclaimsthattheproductis“clinicallyproven”towork.Beforegivingtheendorsement,shereceivedawrite-upoftheclinicalstudyinquestion,whichindicatesflawsinthedesignandconductofthestudythataresoseriousthattheyprecludeanyconclusionsabouttheefficacyoftheproduct.Thedermatologistissubjecttoliabilityforthefalsestatementsshemadeintheadvertisement.”GuidesConcerningtheUseofEndorsementsandTestimonialsinAdvertising,FederalTradeCommission DoestheFTCcarewhethertheendorserisaregularuserofthe product? Iftheadvertisingorthewordingof theendorsementstatesorimpliesthatthepublicfigureusestheproduct,then theymustcontinueusingtheproductaslongastheendorsementisbeing activelymarketed. Ifanadmakesitlookliketheendorser isaregularuser,andtheendorserstopsusingtheproduct,thennomarketing canfeaturetheendorseranymore. Forexample,JenniferAnistontoldPeopleMagazinethatshewasauser ofAveenomoisturizerbeforeandaftershewassignedastheirbrand ambassador.Shehasbeenusingtheirproductssincehermother recommendedittoheratfifteen.Ifthateverchanged,thenAveenowouldneed topulltheiradvertisementsfeaturingher. PROMOTION WhatdoestheFTCdoiftheendorseroverstatesthebenefitsofthe product? TheFTCholdsboththeadvertiserandendorsertoonlystateprovableclaimsabouttheeffectivenessandfeaturesoftheproduct.Theendorsercan’tsayanythingthattheadvertiserbrandcan’tsaydirectly. TheFTCistryingtomakesurethat advertisersandmanufacturersarenottryingtogetaroundtherulesoftheir industrybyusinganendorserasacutout.Anythingapaidendorsersayshas thesamelegalrequirementsasifthecompanysaiditdirectly. Forexample,ifasoccerstarsaidhisNikecleatsmadehimrunfasterinapost-gameinterview,andthathasnotbeenproventobethecase,thentheyneedtoretractthestatement.Ifthestatementisdigital,thentheyneedtogobackandaskthemediacompanytopulldownthepostoramendit. ManymarketersandPRprofessionals sendfreeproductsouttoanetworkofbloggers,journalists,andmedia personalities.Aswelearned,theFTCconsidersthecomplimentaryproductin exchangeforreviewstobeapaidendorsement.Thus,themarketersandPR peoplearelegallyrequiredtofollowupwiththepeopletheysentaproductto andmakesurethattheydidnotmakeanyembellishedormisleadingstatements inthecourseoftheirendorsement.Iftheydid,thenthemarketersandPR peopleneedtomakeeveryattempttohavetheendorseramendthepostwhere theymadetheover-the-topendorsement. Doendorsersneedtostatetheirfinancialrelationshipwiththe advertiser? Yes.Thereneedstobealine everywherethereisastatementthatistheresultofapaidendorsement. Thenatureofpeople’sreactiontoastatementchangesiftheyknowthatthepersonisgettingpaidfortheendorsement.Somepeoplemaynottakeanendorsementseriouslyiftheyknowitispaid.TheFTCwantstomakesurethatthesepeopleknowapaidendorsementfromanunpaidendorsementsothatpeoplecanmakeuptheirmindsaccordingly. Themoniker#adhastakenoffasthesymbolofapaidendorsement,buttheFTCwarnsthatitaloneisnotsufficient.Asocialmediainfluencerneedstostate,innouncertainterms,thattheyarepaidfortheirwordsandpost. TheFTCconsidersboththeadvertiser andendorserresponsibleformakingsurethefinancialrelationshipstatement isthere. IhavetomakesurethatIcomplywiththis.Iam,fromtimetotime,sentbusinessbooksforfreeinexchangeforreviewsonBMB:BrandMarketingBlog.IalsoprovidelinkstobooksandproductsonAmazonthatIcangetanaffiliatecommissionfrom.Inbothcases,IhavetomakesurethatIstateinmypoststhenatureofmyrelationshipwiththeseller.Peoplecantakeitorleaveit,butatleasttheyareinformed. PROMOTION UnpaidEndorsements Everysuccessfulbrandexperiencesthe positiveeffectofendorsement,butonlyasmallfractionofcompaniesevery payforendorsements.Sothemajoritypowerofendorsementscomesfromunpaid endorsements. Ifabrandalignswithpeople’s values,thentheywillproudlydisplaythemselvesusingthebrand’sproduct.If aproductisexceptionallyusefulorsurprisinglydelightful,thenthe product’suserswillpositivelyreviewit. Unpaidendorsementscanbeboth explicitandimplicit. Explicitendorsementsarewhenapersonororganizationunambiguouslyspeakstothepositivetraitsofabrandorproductinpublic. Examplesofexplicitendorsementsthat areunpaidare: Five-starreviewsonanAmazon productpage.Aglowingpostaboutaproduct onFacebook.Five-starreviewsofabusiness onGoogleMaps.Sharingapieceofmediaon Twitter.Aplumberurginghiscustomers tobuyaspecificbrandoffaucet. Implicitendorsementsarewhenapersonororganizationdisplaytheiruseofaproduct,whichcanbeinterpretedasanendorsementbypassers-by. Examplesofimplicitendorsementsare: Someonewearingclothingthatdisplaysabrand’slogo.Ashopperbringinghometheirproductsinabagthathasthestorelogo.Acelebritydrivingabrandofcar.Publiccriticismofapoliticalcandidatewhilenotcriticizingtheotherside.Abrand’sfanstickingalogoofthebrandontheircar’sbumper.Asportsteamwhoseuniformdisplaysthelogoofanapparelmanufacturer.AneCommerceplatformthatorderssearchresultsby“Featured”bydefault.ThenumberoneresultinaGoogleSERP.Apublicfigurespeakingatafundraisingevent.Aretailerdisplayingthelogosofthebrandsthattheysellontheirwindowsorsigns.Co-brandedproducts.Aspeakerataneventwhoselaptopshowsit’slogototheaudience. Noteveryproductthatweusewewould endorse.Sooften,peoplegivemorecredittothebrandthanisdeserved.But thesocialproofofseeingatrustedpersonusingaproductisapowerful influenceonourpurchasingbehavior. Supremeisabrandthathasbenefitted fromthepowerofunpaidimplicitendorsements.Supremecrossedatippingpoint whereitwasconsidered“cool.”Afterthat,showyinfluencersstarted towearSupreme’smerchandisetohelpreinforcetheirrelevancy.Afterthat, thebrandsawexplosivegrowth. Unpaidendorsementsfromfriends,familyandcommunityleaders Whenwethinkaboutendorsements,we imaginetheonesignificantendorsementthatwillsellmillionsofdollars worthofproduct.Buttherealpowerofendorsementscomesfromlotsofsmall endorsements. Friends,family,everydayexperts,and communityleaderscanhavefarmoreinfluenceonthepurchasesofindividual peopleintheircirclethanacelebritydoesforoneoftheirfans.People closertoustalktoourparticularneeds,andnotingeneralities. Herearesomeexamplesofunpaidcommunityendorsements: Acolleaguewhowantsyouto buyaFitBitsoyoucanseeeachother’sprogress.AplumberwhoonlyusesMoen faucets.Thatfashionablefriendwhohas aPradabag.Apastorwhocallsoutalocal businessfortheirsupportofthechurchcommunity.Aunionwhichendorsesa politicalcandidate. Advertisingplatformsunderstandthepowerofendorsementsfrompeopleclosetothepersonbeingmarketedto.Iftheycan,GoogleandFacebookwillshowtheviewerendorsementsfrompeoplewithintheirnetwork.Theabilitytopullwho-you-knowintomarketingispartofthereasonwhysocialmediaadvertisingisvaluedsomuchmorethanadsintraditionalmedia. GoogleAdshasafeaturedcalledSharedEndorsements.Forthefeaturetokick in,someoneifviewinganadandsomeoneintheirnetworkhaspositively reviewedthatproductorbrand.Ifthatisthecase,thenthenameofthe person,thestarratingofthereview,andthefirstfewwordsofthereview willbedisplayedbelowthead.Thissocialproofmakestheadmuchmore effectiveandbuildsanaffinitytowardsthebrand. IfGoogleusingyournametohelp markettheiradvertisersseemscreepytoyou,thenyoucanopt-outofsharedendorsements. Editorsnoteforreaders:Iamunclearwhetherthisfeatureisstillavailablefor advertisers.Cansomeoneconfirmordeny?Pleasecommentbeloworcontact us. Facebookusesfriendrecommendations allovertheplace.Whenyouarelookingatapotentialfriend,theyshowall thefriendsyoubothhaveincommon.PromotionforanyFacebook GroupsandFacebookPageshighlightotherpeopleinyour networkwhohavejoinedalready.AndLocal intheFacebookApp,theproductthatcompeteswithGoogle MyBusiness,showsreviewsfromconnectionsbeforereviewsfrom thegeneralpublic.YouneedtomakesureyourlocationinformationisfilledoutonyourFacebookPage toshowupinLocalintheFacebookApp. PROMOTION UnpaidEndorsementsfromOrganizations Aswediscussedearlier,peopleare quitecynicalwhenitcomestopaidendorsementsfromgroups.Butunpaid endorsementsarequitepowerful. Conscientiousconsumerslookforthe sealsofapprovalofnon-profitorganizations.Forexample,theInsurance InstituteforHighwaySafety(IIHS)publishestheirTopSafetyPicks forvehiclesineverysegment.Oftenthebrandsofthevehiclesthatarepicked displaytheIIHSTopSafetyPickprominentlyintheiradvertising,liketheHyundai examplehere. Theothersignificantsourceofunpaid endorsementsarereviewsfrommediaoutlets.Forexample,Oprah’sFavoriteThingsisalistofproducts thatarepublishedbytheOprahMagazineeveryyearbeforetheholidayseason. Thelistisnotpay-to-playbutdoeshaveverystructured requirementslaidoutbyOprahandherproducers. Endorsementsalsocomefromaggregated lists,like“topsellers”or“highlycriticallyreviewed,” thatarecertifiedbymediaoutlets. Forexample: Authors,publishers,andpublic relationscompaniesworkveryhardtogetabookontotheNew YorkTimesBestsellersListbecausethatdistinctionisso worthwhile.Videogamepublishersshowoff whentheirgamesgeta4+starratingonIGN,anaggregatereview frommanygamejournalists.Moviedistributorsloveshowing offtheirscoreonRottenTomatoes,whichisalsoareview aggregatorofbothcriticsandregularmoviegoers. UnpaidEndorsementsinBusiness-to-Business(B2B) OneofthemostpowerfulapplicationsofendorsementsisinB2B.Thepageinasalesdeckthatshowsthelistofexistingclientsisusuallythemostconvincingslide.Decisionmakersoftengoontoacompany’swebsiteorLinkedInpagetoseeifsimilarprofessionalshaveendorsedtheserviceprovider. Customerslookatwhoyouhaveworkedwithtogetasenseifyourcompanyisasafebet. Weliketodeludeourselvesintothinkingthatthebusinessbuyingprocessismorerationalthanconsumerpurchasedecisions.Butreally,businessbuyingdecisionsaremadeemotionally,andthenbackfilledwithrationality.Peoplemakeagutdecision,andthencomeupwithallsortofreasonswhyitisthemostrationalchoice. Endorsementsservebothasanemotionaltriggertobuyaswellasprovidearationalreasonthatapurchasercantakebacktotheirbossorboard. Peoplewanttofeelsafewhenmakingalargebusinesspurchasedecision.“NobodygotfiredforbuyingIBM”wasanunofficialtaglineofbigblueinthe1980s.Beingperceivedasthesafechoicewaswhytheyweresodominantforsolongintheenterprisecomputermarket. SeeingastrongclientlistandendorsementmakesB2Bbuyerfeelsafebecauseothershavetakentheriskbeforethem,andaredoingwell.Itissocialproof. BothaclientlistandsomepersonalendorsementshelppeoplesellaB2Bpurchasewithintheorganization.Theeasiestpitchforaninternalpersontomaketotheircolleaguesis:“everyoneelseisdoingit.”FromHRsystemstocloudstorage,theinternaldecisioncomesmorequicklyandeasilyifstakeholderscanseethatacompetitorhasmadethemovealready. Howdoyougetendorsementsforyourbusinessproductorservice?Youaskyourclients. Thebesttimetoaskiswhenyoureceiveaglowingpieceoffeedbackfromaclient.Youshouldaskifyoucanputthatstatement,orsomethingslightlyrewordedonyourwebsite. Butdon’twaitforclientstoofferupanendorsement;theyrarelywill.Asimpleemailsaying:“Wearetuningupourwebsiteandsalesmaterialandapositivestatementfromyouaboutourworkwouldreallyhelpusout.Wouldyoumindsendingmeone?” Alotofaccountmanagersdonotsolicitreviewsbecausetheyworrythattheclientwillcomebacksayingthattheydon’tactuallylikeworkingwiththecompany.Butthatneveractuallyhappens. TheworstcasescenarioIhaveeverexperiencedissomeonesaying:“sure,butcanyouleavemynameoffofit.”Ihavealsoreceivedback:“Noproblem.Writewhateveryouwantandputmynameonit.”Thesetypeofresponsescanbeabitdemoralizingbutarefarfromcatastrophic. MorethanhalfthetimeIhaveaskedforendorsements,Ihavereceivedgenuinelytouchingonesback.Andthatishelpfulbothforendorsedmarketingandpersonalvalidation. PROMOTION Conclusion.Endorsementsarepowerful,butyoushouldseekthemoutthoughtfully. Endorsementsarepowerfulinfluencesonpeople.Seeingpeoplethatwerespect,bothpeopleclosetousandpublicfigures,endorseaproductwillmakeusmorelikelytobuythatproductinthefuture.Wearesocialcreatures,andendorsementswillalwaysplaytoourhumannature. Everybrandneedsendorsements,andeverybrandbuilderneedstoencouragepeopletospeakpositivelyandpublicallyaboutabrand’sproductandthebrandthemselves.Everybrandneedstosolicitandencourageunpaidendorsementsbyfollowingupwithpeopletheyknowtousetheirproducts.Paidendorsementsaretrickier,butmakesenseformorebrandsthancurrentlyconsiderthem. Butthereareregulationsandliabilitiesassociatedwithpaidendorsements.Thereisnothingoverlytricky;youcanreadtheentiretyoftheFTC’sguidanceinacoupleofhours,asIdid.Themostimportantthingtokeepinmindisthatthebrandandpaidendorserarelegallytiedtogether;bothareonthehookiftheothermakesmisleadingstatementsortheyareomittingthingsthatarerequiredintheirindustry.Soonlyworkwithendorserswhoarereliableandprofessional. 2Comments Benigna onJune16,2020at8:33pm Hello, Icameacrossyourwebsiteandlearntthatyouplacetherightcelebritywiththerightbrand.Weareanewperfumebrandthatissettolaunchinthenextfewweeks.Myinitialplanwastosendfreegiftsoftheperfumeworthhundredsofdollarstoindividualcelebritiesandwritealettertosolicitcelebrityendorsementsforourfragrances.Havingsaidthat,wewillalsoconsidersomepaidendorsementsifyoumatchuswithaprominentcelebritywhomatchesourbrandvaluesandwebelievetheROIishigh.Kindlyreadandunderstandwhoweareandwhatwestandforandletmeknowyourthoughts.Alsoletmeknowwhatroleyouguyswillplayapartfromjustfindingtherightcelebrityandyourfees,ifany. Thankyou Benigna Reply ColinFinkle onJune21,2020at10:31am HiBenigna,Iwillcontactyouprivatelyaboutthiswithsomemoredetails,buttherearesomethingsinyourquestionthatwouldbenefitallreaders. 1)Yourinstincttosendoutsamplestoinfluencersiscorrect,butblindlysendingitemsisgoingtohavepoorresults.Youwanttoaskthemiftheyareopentosamples,andopentoendorsements.Thiswillmostlikelygothroughtheiragentorbusinessmanager. 2)Thebestwayforanewcompanywithnotalotofcashtogetakeyendorsementistodevelopaspecialproductlinefortheirpersonalbrand.BothBeatsbyDreandNikewithAirJordansbuiltbilliondollarbrandswiththistactic. Ihopethathelps. Cheers, Colin Reply SubmitaCommentCancelreplyYouremailaddresswillnotbepublished.Requiredfieldsaremarked*Comment*Name* Email* Website Δ ThissiteusesAkismettoreducespam.Learnhowyourcommentdataisprocessed. EmailNewsletterLevelupyourbrandknowledge. MembersoftheBMBPremierListreceiveMondayMotivationandsummariesofnewarticles. 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