National weight-loss and pitchman phenomenon Jared Fogle has left Subway in hot water. As a consequence of Fogle's child pornography scandal, Subway has been forced into the spotlight under less-than-positive circumstances.
Though none of Fogle's wrongdoings are tied to the company itself, separating Jared "the Subway Guy" Fogle from the Subway brand is almost impossible. The two have become synonymous.
So, what Subway could have done differently? Could it have prepared for this situation?
The simple answer is that nobody could have been prepared for such a scandal. But the Subway team's biggest mistake wasn't an inability to predict the future; it was putting too much brand recognition into the hands of a single individual.
(To be fair: Subway tried to distance itself from Jared long before the scandal news broke, but his close connection to the brand was too powerful and longstanding to ignore.)
Celebrity Endorsements Gone Wrong
Unfortunately, the problem is all too common. Promoting a well-known pitchman seems like a fast and easy way brands can increase recognition and sales, but time and again companies have been burned by the actions of their celebrity endorsers.
In 2007, NFL quarterback Michael Vick was charged for organization and participation in an illegal dog-fighting ring. At the time, Vick had a $2 million endorsement deal with Nike, which was immediately pulled and left Nike reeling from the consequences.
The headlines focused on how the brand's numbers were affected—from sales to market share to the number of executives now under investigation for their complicit action or inaction surrounding the scandal.
Moreover, one person's actions can have a ripple effect on one or many brands. For instance, at the time of Lance Armstrong's performance-enhancement scandal, Armstrong was tied to Anheuser-Busch InBev, Trek Bicycle Corps, Honey Stinger, and more; Nike even had a major building on its campus named after Armstrong.
Celebrity Endorsements vs. Micro-Influencers
Celebrity endorsements have long been a staple of building brand awareness, but marketers are getting smarter—and they're taking new approaches.
One method that marketers have been tapping into lately is what some brands are calling micro-influencers. These are people who have little to no "celebrity" compared with giants like Tiger Woods and Lance Armstrong, but these non-celebrities' engagement and credibility within a particular community make their advice and opinion highly influential.
When you take a close look, these micro-influencers personify the more powerful factors of influence that go beyond huge celebrity and high follower counts, such as first-hand experience, category expertise, and authenticity.
Consumers don't trust traditional advertising, and though celebrity endorsements are flashy and can build a stronger connection between consumers and brands, celebrities are proving unreliable. Consumers generally look for product reviews on Amazon and a blog as well as experts within their own networks. Marketers are therefore trying to adopt brand awareness programs that cater to such behavior.
The Example of Lululemon
When Christine Day started at Lululemon in 2008, she implemented the brand ambassador program. The company began to reach out to yoga instructors near its retail stores and gave them the opportunity to help build Lululemon's brand awareness. By providing local instructors with merchandise that hadn't yet been released to the public, Lululemon began creating a powerful network of micro-influencers and local brand experts.
Ambassadors quickly became a part of Lululemon's early product feedback cycle and helped to both relay information back to the brand and promote Lululemon to class participants. Because of Lululemon's brand ambassador program, retail stores began to show a 6% increase in sales growth within the first quarter alone.
Despite product crises or bad publicity, Lululemon's group of grassroots brand advocates can always be called upon to recommend the company's products and share their knowledge of the brand in a more relatable way than any celebrity can.
The Example of Luvo
Luvo, a frozen-food startup, is using a hybrid of these methods. By using more high-profile brand ambassadors, such as Russell Wilson and other major athletes, Luvo is still using the power of celebrity while spreading it across multiple spokespeople to ensure that its ambassadors are more independent from one another. That way, if one celebrity falls, it doesn't ruin the image of the entire brand.
What makes Luvo's brand ambassador program different is that many of its brand ambassadors are also investors. That not only shows an added measure of faith in the product but also helps to add a layer of insurance: By being financially invested in the company, these influencers will be less likely to behave in a way that jeopardizes their financial gain.
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A new era of brand awareness is being ushered in by companies like Luvo and Lululemon that understand that consumers listen to brand advocates who embody trust—whether in the voice of a single expert or in influencers by the hundreds and thousands.
Micro-influencers give organizations not only the ability to find a voice that aligns perfectly with its brand but also an army prepared to pick up the slack the next time a Jared Fogle emerges from their midst and threatens to give a black eye to the brand.
A micro-influencer strategy both builds more loyal customers among the influencer crowd and spreads a powerful message to the consumers you want to reach.
Continue reading "Jared and Subway: A Fall From Grace, or Why Brands Should Use Micro-Influencers to Build Credibility" ... Read the full article
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