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Credit Where Credit is Due

2008.05.20 18:18

Usher credit card

Today I have the unexpected honour of being heavily quoted in an article on CreditCards.com. The author, Emily Starbuck Gerson, discusses celebrity credit cards, and why they generally don’t work. She interviewed me and I provided some memorable lines like this:

Having a celebrity-branded product is analogous to taking advice from that person. You might take fashion and beauty advice from a famous model or actress, but would you trust her to fix your car or tutor your children for the SATs? Why then, would you take financial advice from someone totally unqualified?

Is it wrong to quote myself? Well, if so, check out the article here »

If you’re interested in my full, unedited answers, read ‘em after the jump.


1) How does a celebrity benefit from having a branded credit/debit card? Do you think it helps his or her image, or makes it worse?

Celebrities benefit from branded credit cards in two ways. First is the obvious financial way – they are sure to get a deal from the banks or credit agencies either as a flat fee or as a commission on every card. Since celebrity status helps attract new customers (at least in theory), it’s a form of marketing tool, and so the personality deserves to be paid for that alone. However, most celebs don’t need the relatively small payday, but rather they’re in search of the second benefit.

The other, more abstract reward is the concept of celebrity itself. After your make a few tens of millions of dollars, Fame, not cash, becomes the desired currency. The goal is to become more and more famous and to stay that way. The easiest way to do this is simply to plaster one’s face on as many consumable objects as possible. It works on the same principal as outdoor advertising – seeing a brand image over and over may not trigger a direct sale, but it lingers in the mind of a consumer for some future date. Being on someone’s mind is useful for the next time a celeb releases a film or a CD or whatever else. If the celebrity figure is viewed once a week, or once a day on the face of a credit card, that amounts to a serious amount of “hits” and therefore makes them slightly more famous.

So the short answer is that it makes them more famous, as well as slightly richer.

Generally, I feel this does not help at all. Yes, celebs may earn a few dollars by lending their name to a financial product or service, but the damage to the celebrity “brand” is far-reaching. (see answer #2). In short, it makes the celeb appear as a money-grubber, someone who doesn’t value his own name and is willing to slap his face on any ol’ thing that will sell.

2) Celebrity-branded credit and debit cards don’t seem to be all that popular, and many that once existed are now defunct. Why do you think celebrity-branded fragrances and clothing lines have done well, but payment cards have not?

Actors, musicians, and socialites exist in a world of glamour, sophistication, and fashion – these are all aspirational values for the middle- and working-class consumers who follow them. Selling perfumes and clothing in that same vein therefore seems like a natural (or at least reasonable) extension. But selling credit services crosses some invisible line in the mind of the consumer. The perception is that this celeb no longer embodies elegance and style, but rather he’s simply trying to cash in any way he can.

From a branding point of view this is a simple mis-match of values. With the exception of Donald Trump, Warren Buffet, and Donny Deutsch, et al. there are very few celebrity businessmen. These individuals may boast financial fortitude and market knowledge as their core values, but I can’t say the same for Hillary Duff or Usher.

Having a celebrity-branded product is analogous to taking advice from that person. You might take fashion and beauty advice from a famous model or actress, but would you trust her to fix your car or tutor your children for the SATs? Why then, would you take financial advice from someone totally unqualified?

I believe that the consuming public sees this gap and understands enough to be cautious. With the average American family drowning in debt, and the economy tightening, public awareness regarding credit is actually increasing – we’re less likely to fall for a scam and more interested in the fine print. Considering most cards are the same (with the exception of slightly different rewards schemes), most consumers are fine with the same card we’ve had for years.

There’s also the problem of time. Over time, credit card companies reward their customers with lower interest rates, higher credit limits, increased rewards, and access to more prestigious cards. The notion of “member since” stamped on the front helps customers reinforce this feeling of pride over time. Celebrities, however, exist in the here-and-now. Since they go out of fashion with every changing season, most consumers aren’t willing to throw away their hidden ‘time equity’ for someone who may be old hat by this time next year. Imagine if you had signed up for a Britney credit card back in 2002. I bet you’d regret it these days.

I always define life in terms of fine lines. In this case, there is a fine line between being a fan and being a sheep. The public has spoken, only sheep use celebrity-branded cards.

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  • http://www.YoungEntrepreneurSociety.com Lyall

    I think it does not help the celebrity much in terms of image. The card gains more and that’s the purpose of the ad anyway.

    I came across an entreprenurial site I want to share with you, the Young Entrepreneur Society from the http://www.YoungEntrepreneurSociety.com. A great documentary about successful entrepreneurs.

  • http://www.YoungEntrepreneurSociety.com Lyall

    I think it does not help the celebrity much in terms of image. The card gains more and that’s the purpose of the ad anyway.

    I came across an entreprenurial site I want to share with you, the Young Entrepreneur Society from the http://www.YoungEntrepreneurSociety.com. A great documentary about successful entrepreneurs.

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