(847) 690-9454 info@leifjensenassoc.com

Are consumers the lemmings that retailers believe them to be?  Just because a celebrity is paid to point to an object does not mean that consumers will automatically buy that object.  Or will they?

Amazon is betting big on Lady Gaga to do just that with cosmetics, versus the established celebrity brands that already exist.

The celebrities consider these moves to be an extension of their brands.  Creating companies to “make” and sell certain products.  Then they set up exclusive distribution agreements for these products with retailers.

A couple of years ago I was at the “Sage Summit” where celebrities were on the main stage to discuss the trials and tribulations they experienced with these startups.  One celebrity has little to no idea what was being sold in her name and had no clue how the company had been run.  She also had just cashed out with the sale of the business before the Summit.  So with no practical business experience, I am still questioning why she was there except for the paycheck…

These partnerships also tend to be fluid; I remember a 100 years ago when Martha Stewart was tied to K-Mart.  So much so K-Mart had her home goods in the front of the store when you first walked in.  Then she left K-Mart, I am not sure if she had another exclusive agreement or not, but I don’t recall seeing her name on products after her departure K-Mart.

With the changes in the retail landscape over the last 10 years, the expected future landscape is a great unknown. Since businesses do not like uncertainty, my guess is that businesses are looking for whatever edge they can get over the competitors.  Which means paying celebrities to bring their eager followers in tow.

Pin It on Pinterest