Images and
Merchandising
Impact of Image
 An image is a mental picture or concept of
something or someone
 Celebrities are constantly in the public eye
 Portray positive public image
Selling the Image
 Use of celebrities’ image to sell product
 Increased opportunity to make a profit
from merchandising
Merchandising
 The variety of promotional activities and
materials that complement and support the
advertising effort
 Multibillion-dollar industry. Can earn as
much as box-office revenue.
 Usually a five-year period to make money
through merchandising
Merchandising
 Direct or Indirect
 Direct Merchandising – Finding Nemo –
toys and plastic figures of Nemo and
Bitin’Bruce
 Indirect Merchandising – Finding Nemo –
bedding, drinking glasses, clothing
Merchandising
 Marketers also develop merchandise tie-in
promotions
 Between two or more parties
 McDonald’s
Endorsement
 Celebrities appearing in commercials
supporting and giving their aproval for
products
 Person in the commercial must act as
himself and not as a character
Endorsement – Federal Trade
Commission (FTC) regulates
 Defines endorsement as any type of advertising
done by a person who reflects his or her own
opinions, beliefs, findings, and experiences that
are separate from those associated with the
product’s company
Endorsements
 See Figure 14.1 – pg. 318 – for FTC
Endorsement Guidelines
 Example – Ben Affleck endorsing
American Automobile Association
Ben Affleck Endorsement
 Target would be people 16 – 30 years of
age
 This group would be influenced by Ben
Affleck because of his age and the culture
he represents
 Better choice than Paul Newman
Controversy of Endorsements
 Tiger Woods – went against his $100
million contract with Nike when he
switched back to his older Titleist golf club
 Madonna – endorsed Pepsi but refused to
be seen drinking Pepsi in public
Controversy of Endorsements
 Can get more complex and risky when
entertainers become involved with and
endorse political issues and groups
 Can damage a celebrity’s career if people
don’t agree with their views
Sponsorship
 Occurs when a company supports an
event, activity, or organization by
providing money or other resources that
are valuable to the event
 Sponsor is usually provided with some
type of advertising
Sponsorship
 One of the most popular methods that
companies use in promotion
 Musicians have to find a way to cover all
of the costs of a tour
 Sponsors will then put their name on
various advertising space
Sponsorship
 Why sponsor?
Businesses want a return
on their investment.
 Sponsors make an investment in a person
or group that is best suited to represent
the company.
 They do not have to use the product.
Sponsorship Risks
 Consider what would happen if a company
sponsored an individual who found
themselves in legal trouble
 Federal Government can pass laws that
impact sponsorships
 Example – tobacco and alcohol were banned
from events appealing to children and teens
Licensing and
Royalties
Merchandising
 Putting teams, athletes or celebrities on t-
shirts
 Amusement parks put retail areas next to
new rides
 Will buy something when more excited
about the event – t-shirt, picture on ride
Licensing
 Licensing is required when the owner of
an original image (logo) or a product
(good/service) gives legal permission for a
fee to another company or person to copy,
manufacture, market, and sell
reproductions of the original item.
Licensing
 Most recognizable examples of licensing is
seen in clothing.
 Images such as Mickey Mouse, The Simpsons,
a favorite band, film logo, actor/actress, sports
team
 Original company makes money from the
licensing fee and manufactures make money
from the sale of the items
Licensing Music and Royalties
 Licensing applies to music, software, motion
pictures, and video
 Songwriter/publisher may charge a licensing fee
when an artist wants to record that song
Licensing Music and Royalties
 The Bodyguard
 Whitney Houston received Grammys for Single
of the Year, Best Female Pop Vocal, and Album
of the Year for the song I Will Always Love You
Licensing Music and Royalties
 Dolly Parton wrote and sang the original version in
the early 1970’s. She and her publishing company
received a licensing fee.
 Parton also received benefits and royalties from
every version that is sold or broadcast
Licensing Music and Royalties
 When Parton was asked if she was upset that
Houston won a Grammy for a song that she wrote,
Parton responded by laughing and exclaiming, “Are
you kidding?”
 Can also receive an up-front amount just to sign the
song
Paying for Entertainment
 Celebrities are just a small portion of the
entertainment industry.
 The Entertainment Industry employs over
one million people
Paying for Entertainment
 When music, movies, software are illegally
downloaded and distributed many people
are affected:
 Musicians
Sound
Technician
 Makeup Artist
Costume
Designer
 Lighting TechnicianSet Decorator