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Celebrity endorsement market back on track

Last updated on: October 26, 2009 15:51 IST

Celebrity endorsement market back on track

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Ashish Sinha in New Delhi

After a lull of over eight months when virtually no new endorsement deal of any significant value was signed, the Rs 400-450 crore (Rs 4-4.5 billion) celebrity endorsement business is back on the recovery path.

Celebrity management firms like Globosports and World Sports Group say the celebrity endorsement market is estimated to clock a healthy growth in 2009. Senior executives at these firms say while there is no organised agency to track the deal size of the endorsements, the market size is expected to grow 15 to 17 per cent in 2009.

Endorsements by film stars, estimated at around Rs 150 crore (Rs 1.5 billion) and growing at 25 per cent, have displaced sports personalities from the top slot.


Image: Actress Kareena Kapoor models for a cosmetic brand.

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Cricketers have seen a slow growth of 10-12 per cent largely because of India's poor run at important cricket tournaments this year like the World Cup T20, ICC Champions Trophy among others, says Indranil Das Blah, former head of the sports business at Globosports, a specialised sports and celebrity management firm that manages the commercial interest of Sania Mirza, Lara Dutta, Saif Ali Khan, among others.

Blah recently quit Globosports to form an independent sports and celebrity management firm in Mumbai along with its CEO, Anirban Das Blah.

In the last two months alone, some of the big brand endorsement deals that have been announced include Hrithik Roshan's deal with Reliance Communications that is estimated to be worth Rs 5-7 crore or Rs 50-70 million (for one year) and Gautam Gambhir's with MRG through its new agent, the World Sports Group. A host of new deals are likely to be announced shortly with cricketers and film stars.

According to sources in the business, categories like telecommunications, food and beverages, sports apparel and personal care have emerged as the top spenders on celebrities even this year.


Image: Tennis star Sania Mirza.

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"I would estimate that the top four categories would together be spending over one-fourth of the overall celebrity endorsement business. This is because the endorsement fees charged by the celebrities have gone up specially in these categories, says Blah.

Industry sources say overall, there are over 50 cricketers who endorse a vast array of brands, from sports apparels to foods and drinks. However, only a half-a-dozen like M S Dhoni, Sachin Tendulkar, Yuvraj Singh, Rohit Sharma, Gautam Gambhir and Virender Sehwag command a bulk of the endorsement pie.

Says Harish Krishnamachar, vice president of World Sports Group: "Cricketers control almost 80 per cent of the Rs 250 crore (Rs 2.5 billion) sports celebrity endorsement business. In recent times, this market has been pretty stagnant but the business is looking up."

The WSG is a Singapore-based sports marketing company and is also the co-telecast

rights holder for the Indian Premier League, a BCCI promoted Twenty20 format cricket tournament. It recently signed cricketer Gautam Gambhir and looks after the brand endorsement deals for Sachin Tendulkar.


Image: Actor Aamir Khan in the new Coca-Cola ad.

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But other sports stars are not as lucky. Despite an Olympic medal, ace-shooter Abhinav Bindra has not got any big endorsement deals apart from Samsung and a few others. Same is the case of another Olympic medalist and World s top boxer in his weight category Vijender Singh.

Before his multi-crore contract with Percept for the Indian version of TV boxing show The Contender , Vijender was getting not more than Rs 30-40 lakh (Rs 3-4 million) per endorsement.


Image: Cricketer Mahendra Singh Dhoni.

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Same is the case with Saina Nehwal, the country's leading badminton player who commands much lower endorsement fees compared to any cricketer," says a senior executive of a leading sports management firm.

But what is pushing the growth in this business? Veteran ad-filmmaker Prahlad Kakkar says "The value charged by celebrities like Dhoni and others along with the entry of youngsters is pushing the business. Dravid and Ganguly are out of this race but there are always new faces that keep coming up."

Sources say Aamir Khan received a meager Rs 15-17 lakh (Rs 1.5 to Rs 1.7 million) for his brand endorsement deal for Pepsi in the early ninties. Currently, he charges around Rs 8 crore (Rs 80 million) per endorsement for just one year. Dhoni charges around Rs 5 crore (Rs 50 million) per endorsement currently, up from Rs 25-30 lakh (Rs 2.5-3 million) when he started a few years ago.


Image: Actor Aamir Khan in the Tata Sky ad.

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