Companies are protecting themselves against a backlash in sales when the sex secrets of stars who promote their brands are aired in public.
Brand owners are faced with losing millions of pounds if they are forced to terminate partnership deals, according to Mark Symons, underwriter at insurance provider Beazley. Sales of the insurance policies have increased by almost a third, he claimed.
‘Because there have been some very high-profile cases in the past few years, there has been an uptake of interest in this,’ he added.
‘Either you lose the money or you get a policy that will pay the cost of you restarting a campaign.’
Coke ditched plans to put Manchester United footballer Wayne Rooney’s face on Coke Zero products following allegations about flings with a prostitute, while brands endorsed by golfing champion Tiger Woods saw billions of pounds wiped off their value after his multiple marital misdemeanours were exposed.
The insurance cover rests on whether an ambassador’s actions can be said to be unforeseen or out of character – and therefore detrimental to a brand.
Robert Barron, from insurance broker Lockton, said that the fear of becoming embroiled in sleaze was enough to turn some companies away from celebrity endorsements.
‘If you start buying disgrace insurance, at the end of the day there’s a cost, so people are starting to look again at regular types of promotion that are not to do with a certain individual,’ he added.
‘If you pick the right celebrity you can add millions to sales but choose carefully.’
Source : Metro
