PODCAST: Bad behavior can tarnish celebrity endorsements

This 九色视频 Newsline Podcast is available at . See the transcript below:

You鈥檙e listening to the podcast edition of the 九色视频 audio newsline. Learn more about 九色视频 鈥 the home of Thinkers, Doers, Movers and Shockers 鈥 on the Web at .

Tiger Woods, arguably the greatest golfer ever, has parlayed his talent and image into becoming one of the world's most valuable pitchmen. However, late in 2009 his image took a huge hit, and he went from being one of the most visible celebrities in TV commercials to nearly invisible. The impact on Tiger Woods for his off-the-golf-course behavior may never be fully known, but it definitely affected his bottom line, according to many financial experts. 九色视频 marketing expert Cindy Claycomb says companies have several options when their spokesperson's image is tarnished.

Claycomb: "There are some options for companies whose spokespersons behave badly. One is, depending on their contract, they could fire the spokesperson. Most of them back off of their ads until the publicity kind of wears down and they wait for public reaction and for the media to calm down. Some companies, as you can see, have stopped using Tiger in their ads."

Claycomb talks about the potential for companies using celebrities for image purposes.

Claycomb: "There's really some good potential for celebrities being spokespersons for companies and some potential for companies, too. The celebrities obviously make money, and the companies, it really helps with their image 鈥 for instance, if you look at the history of Michael Jordan and Nike or Tiger Woods and Nike before his problems."

Claycomb says celebrities can make a difference in a company's image.

Claycomb: "If companies choose the right spokesperson it really does help their image and their sales. If they choose the wrong spokesperson sometimes that doesn't work out, but if they choose the right one, it really does help those things."

Of course, Tiger was hardly your average spokesperson. Woods' array of endorsements helped him become the first sports star to earn $1 billion, according to Forbes. Michael Jordon, Woods' closest contemporary, was a distant second at $800 million, amassed during and after an NBA career that spanned nearly 20 years. Tiger's appeal set him apart from most celebrities, according to Claycomb.

Claycomb: "Tiger's appeal has been really across the board. Typically endorsers will have just one or two endorsements, but Tiger's used by sports, technology, telecom, consumer products 鈥 just across the board."

But Claycomb says companies that rely heavily on one spokesperson face some inherent risks.

Claycomb: "There are some risks for companies who heavily depend on celebrities like Tiger Woods. When the celebrities have something that's negative in their behavior, that often reflects back on the company, and companies have to decide how they're going to react to that."

How many companies will cut ties with Tiger remains to be seen, but at the very least, Claycomb said it was interesting how fast companies pulled ads that featured Woods.

Claycomb: "While companies were a little bit reluctant to say that they were pulling their ads or pulling their products because of Tiger's behavior, it seemed a little suspicious or at least curious that the timing of these products and ads being pulled were the same time that things came out about Tiger."

Claycomb says when you're a spokesperson for many products like Tiger Woods, image is a bigger deal.

Claycomb: "As a spokesperson, if your image is pretty squeaky clean and you're tied to many products like Tiger was, it becomes a bigger deal. Sometimes if you're just tied to one particular product then it depends upon what the action was that you took."

One of the interesting questions still to be answered is whether Tiger will once again be highly sought after as a spokesperson when he returns to golf and starts winning.

Claycomb: "So Tiger's future 鈥 well, when he comes back to golf and starts winning again, I think the endorsements will come back. I think companies will watch the public reaction to Tiger when he comes back and then make decisions based on that."

America loves comeback stories, but Tiger's future ad opportunities are likely to be limited to sports product endorsements, significantly reducing his earnings power, according to some experts. Companies often use athletes and celebrities in image ads not to sell products, but to ride the coattails of their perceived qualities in the hope that it will rub off on them. It may be that those kinds of ads are gone forever, costing Woods hundreds of millions in future endorsement fees.

Thanks for listening. Until next time, this is Joe Kleinsasser for 九色视频.