Is celebrity ownership key to beverage success?
Celebrity brands dominate in beveragesNew celebrity-owned brands are numerous in beverage Ownership of the brand gives celebrities a stake in successCelebrity involvement builds trust in consumers Celebrity brands dominateSmaller brands find it difficult to cut throughCelebrity brands have seen an explosion of popularity over the past two decades. While brands owned by celebrities are nothing new, NPD in the area has been coming in thick and fast, especially since 2013 when George Clooneyâs Casamigos Tequila was sold to Diageo for $1bn (âŹ856.8m).
From Gillian Andersonâs G Spot to Bryan Cranston and Aaron Paulâs Dos Hombres, if you can think of a celebrity they probably have a drink brand.
But with such a clamour for celebrity involvement, market penetration is significantly harder for smaller brands, without the capital to invest in the involvement of the rich and famous.
Do celebrity brands cut through to consumers?Celebrity brands, like many other trends, have become more popular because initial successes have pushed other brands to capitalise on this success by getting celebrities involved.
âI think once someone has success in this space, others see it and view the potential,â suggests Andrew Gill, chief strategy officer at Snoop Dogg and Dr. Dre-owned brands Gin & Juice and Still Gin.
âI think it is an attractive space to be in and thus itâs no surprise to see more people of note joining in.â
Also read â Are celebrity drinks marketing gold or reputational risk?Does such a celebrity connection help cut through to consumers? âIt certainly can help raise initial awareness but ultimately, quality of products wins the day.â
Celebrity connections dramatically boost brands, getting them into the public eye and potentially bringing in their large following of fans, according to the drinks market analyst IWSR. It even has the potential to raise consumer trust.
How are celebrity brands affecting competition?Celebrity brands have become increasingly dominant, especially within the alcohol sector.
The real recent shift, explains Oren Bitan, shareholder at law firm Buchalter, has been towards celebrity-owned brands, rather than simply celebrity-endorsed.
âThatâs where the business has really gone â itâs not really about the endorsement or paying for it,” says Bitan.
Smaller businesses can be put at a disadvantage by this. âYou certainly need the money and the capital to attract a celebrity to be part of your ownership structure.â
If a celebrity is then part of this, they are incentivised to promote it, far more than a payment for a simple endorsement would do. Such endorsement helps distinguish new brands.
âOut of the hundreds and hundreds of thousands of products out there, it is very difficult to make an independent mark without some distinguishing characteristic, and celebrity has certainly become a popular one.â
Lucrative exits like George Clooneyâs have signalled to other celebrities that this is a good business to be in.
On the flip-side, âif youâre a non-celebrity owned or affiliated . . . brand, youâre competing against some pretty big names.â
While alcohol is certainly not the only category from which celebrity-owned brands have originated, many of them have been alcoholic.
âThereâs a psychological association between celebrities and festivities and celebration, and perhaps thatâs one of the factors that has spawned that,â Bitan suggests.
