Rihanna to Serena Williams to Shah Rukh Khan – here’s how celebrity entrepreneurs are disrupting the market

Celebrity entrepreneurship is here to stay. A look at this exciting new world and what it entails…

Any business person worth their salt will tell you that a tried-and-true way to grab eyeballs for their product is to score a celebrity endorsement. Nothing looks as great on a giant hoarding adorning Times Square or the slick streets of Dubai as a good-looking celebrity, swearing by your brand.

These personalities, which constitute movie stars, pop singers, and a miscellany of famous people, have always enjoyed the sweet symbiosis of endorsements – from clothes to jewelry to make-up, even holidays, lifestyles, political opinions, public service health announcements. They lend credibility to a brand and, in return, do not hesitate to charge big bucks for how that credibility benefits the brand.

In August 2021, the world came to know that popstar Rihanna had unfurled her umbrella to earn one more accolade under its ambit – billionaire. This was not only due to her music career but also her beauty brand, Fenty Beauty launched in 2017, and her SAVAGE x FENTY lingerie line, causing her net worth to shoot up to $ 1.7 billion. Started when she was 29 to create an inclusive make-up brand that would not propagate Eurocentric beauty ideals that solely focused on fairness, the brand’s wide shade range with 50 skin tones, and a “vision of the new culture of skincare” has ushered in a revolution in make-up.

Rihanna’s business is indicative of a hot new business trend – that of celebrity entrepreneurs. Moving beyond the role of being an expensive advertising strategy, celebrities have evolved, looking to command the lion’s share in the market with a simple, game-changing question – what if the business was owned and run by the celebrity?

FORAYING INTO THE MIDST OF THE BATTLE

Firstly, being an artist versus being a celebrity are vastly different enterprises. Celebrityhood is consciously curated, an attachment of value to the cost of fame, with the recognition becoming its own asset and hence a source of income. The creative arts have long upheld the gig economy, so since time immemorial, celebs have diversified their enterprise into avenues that are lucrative, providing long-term revenue and a stable business as an evergreen choice.

When celebrities are roped in only for endorsement, they are neither in the creative seat nor running the business, so the money or impact created stays limited to advertising. Their personality is commodified, not authentically projected. Now, with manufacturing and outsourcing of tasks getting simpler, along with humongous public support and media coverage, celebrity businesses garner eyeballs, publicity, and an initial market break-in. Creating and maintaining a positive perception is not a challenge for them. There is no trouble pinpointing the brand’s audience either: the celeb’s fanbase becomes that of the brand’s, easy peasy.

Celeb brands primarily are a way for them to further their personal brand. For instance, Serena Williams has trademarked ‘Aneres’, her name spelled backward, for future use for her clothing and beauty franchise. Given that she is one of the highest-paid sports stars globally, money is not a driving force, but creating a lasting legacy certainly is. Similarly, Ariana Grande too chose to trademark her hit song, ‘Thank You, Next’ for her upcoming product line, once again drawing attention to her artistic talent and phenomenal success as a vocalist and much-adored millennial celebrity.

CHALLENGING THE STATUS QUO

More recently, celebrity brands have created a ripple and begun to compete with more traditionally established companies. New brands by celebs do not have the critical initial period of getting the word out to customers. Instead, their offerings are marketed months in advance and usually have pre-bookings and illustrious clientele already going for them.

Comparatively, a brand by a quintessential organization sees an uphill struggle for a few initial years trying to build a loyal customer base. They rely on metrics like quality, perception, customer service, and testimonials to get the word out. However, this does not mean that traditional brands are likely to fade away. After all, a celebrity-led business only trumps the war when it comes to the element of marketing. Companies turn a profit or gain an indelible public following for the value of the product, ease of use, longevity, quality, and competitive pricing. Not to mention, celebrity products often eye an elite, higher-level clientele, and the exclusionary pricing may leave them out of reach from the hands of a humbler middle class.

BREAKING RULES AND MONOPOLIES

However, there is no place for complacency in a marketplace where the rules of the game change with every scroll of social media. In the past, celebs have stuck to their strengths – choosing to start businesses and products in familiar spaces. So, their domain often stays limited to clothes, beauty, fitness, fashion, and fine living.

Serena Williams has trademarked ‘Aneres’, her name spelled backward, for future use for her clothing and beauty franchise

But today, with businesses going increasingly inter-disciplinary and the definition of success and genius rapidly evolving, there is no need for celebs to stick to one lane. Now, they’re diversifying out of their domain and fast. So Oprah has a TV network that has made her one of the richest African-American women in Hollywood. In contrast, Kevin Costner has created a device that separates water from oil and has sold units to BP to clean up their oil spill in the Gulf of Mexico. Robert DeNiro has a Japanese restaurant called Nobu, which boasts outlets in several international cities. Clearly, with capitalist motivations, good old-fashioned research, and abiding public support, no business is out of their league.

Has a celeb or personality ever made a brand so cutting edge that it actually pushed competitors out of the market? Well, Dr. Dre’s ‘Beats’ is one. Not many people know that the unilaterally successful headphone brand ‘Beats’ that commands almost 70% of the market share in high-end headphones and is prominently featured in most top-notch music videos in Hollywood is started by successful 90s rapper Dr. Dre.

Similar disruptions have been caused in the beauty space by Fenty and lately Kylie Jenner. She is a force to be reckoned with in the world of cosmetics, and all her endeavors, be it Kylie Cosmetics, Kendall + Kylie clothing line, the Kylie Shop official merchandise or Kylie Skin – are very popular across media and clientele, with fashion and make-up enthusiasts swearing by them. These brands are definite examples that, when done right, a celeb business could actually change the market landscape.

These brands are definite examples that, when done right, a celeb business could actually change the market landscape

Some star-studded endeavors prove pathbreakers in an unexpected way. India poses one such example with the Red Chillies VFX firm by Shah Rukh Khan. The actor, widely known as the most famous actor in the world, started the VFX wing as part of his production firm in 2005, which has since elevated the level of VFX across Hindi cinema and has been the recipient of national and international acclaim. It has since left behind the cinematic legacy of the pioneering superstar to create an enduring one of its own.

But we’re saving the biggest for last. Elon Musk does not have your typical celebrity brand, but then, he’s not your typical celebrity either. A tech genius who is the definition of the term itself and a routine disruptor and rule-breaker, his forays in every space of his choosing have upset the ecosystem – be it automobiles or space exploration. Even if today several companies are running their own experiments with self-driving cars, there is no denying that it was Tesla’s relentless publicity along with technical supremacy that stripped self-driving vehicles of their purported villainy and danger, and drummed up support and trust towards self-driving vehicles from the public in earnest. Time and again, Elon Musk’s status as a tech celebrity has kept his business in the news and share prices going, proving with certainty how fame can sometimes shield a business from the brute forces of the market.

BEYOND THE APPLAUSE

This does make it seem like celebrities have it made – good looks, unbound fame, and a Midas touch when it comes to business. It’s not all rosy, though. Fame is a double-edged sword, and he who wields it knows its brunt. Reality TV star Kim Kardashian faced such severe backlash in 2019 when she named her shapewear line ‘Kimono’ that she had to rename it to ‘Skims’ to prove that she was not trying to culturally appropriate the history of Asian people. Regular companies with unglamorous leadership never really face this problem. Case in point: The make-up brand ‘Swiss Beauty’ is made in the People’s Republic of China, and no one bats an eyelid at the brand name.

Moving beyond the role of being an expensive advertising strategy, celebrities have evolved, looking to command the lion’s share in the market

Public expectation can also be disproportionately high, with criticism often reaching vitriolic levels. When Kylie Jenner was crowned a self-made billionaire by Forbes, people went into overdrive trying to prove that her famous background made the claim of ‘self-made’ seem ludicrous. Furthermore, poor performance and false claims of the company can actually hurt in reverse where the artist’s credibility gets damaged by the brand. Gwyneth Paltrow is a solid example of this, who has had questions raised on her clout as an actress thanks to the pseudoscientific claims of her wellness brand ‘Goop’.

However, at the end of the day, the negatives are a small price to pay. With steadily rising net worths and an even steadier stream of good press that entrepreneurship affords, celebrities will keep using their good name to multiply their wealth and cater to their loyal fan base with more than just their artistic skills or stellar looks and personality. Jessica Simpson may have made her fame with her hit number, ‘I Wanna Love You Forever’, but it was the success of her eponymously named brand that made her the billion dollars. With fame, such a fickle friend, even celebrities need a safety net.

With movie merchandising, venture capitalism, profit sharing with big movie productions, and other revenue streams flooding with opportunity, this trend is set to snowball. After all, you know how the saying goes, ‘You can never be too thin or too rich!’

Best things to watch, read and own it

Telehealth services grows by 4000% in the last year