Merits & Demerits of celebrity endorsements

Abstract

People buying a product endorsed by the celebrities has been happening for several decades and advertising firms use their communicative skills in convincing their clients that celebrity endorsement of a Brand is the best bet in the current circumstances because of the standardization of many products and inability of the companies to create a strong differential or USP in a product that can have temporary competitive advantage or sustained competitive advantage.   As a result, companies spend huge money on celebrities and this additional cost is finally passed on to the consumers who indirectly pay for the celebrities because of the higher price of the products. Of course there are merits in doing it when the company is not able to create a unique product or a product which is different from the competition but an attempt is also made to find out whether there are any disadvantages in doing it.