Kanye shows the tightrope of celebrity endorsements for brands

Before Kanye West, there was Lillie Langtry. When the actress and socialite lent her name to Pear’s Soap in the 1880s, she became the first celebrity paid to endorse a consumer product.

A decade later, she was also the first celebrity to be dumped for her indiscretions. Her racy private life and royal wedding rings fascinated Victorian society, giving her exactly the kind of mass appeal brands craved. But eventually it all became too much for “perfectly pure soap”.

Pear’s had discovered that fame sells, and connections to flamboyant stars can send an extraordinarily powerful message to consumers. But not always the message you want.

Endorsement, sponsorship, creative collaborations – these agreements have become staples of the marketing world. If she were here today, Langtry would likely have a skincare pouch for sale on TikTok, two fragrances, a wellness brand, and a line of monogrammed jumpsuits.

His alleged excesses and the problems they created for Pear’s were not a touch of what was to come. Hertz with OJ Simpson. Nike with Tiger Woods and Lance Armstrong. Pepsi with Michael Jackson, Mike Tyson and Madonna (you may remember the furore over his “Like a Prayer” video).

West, whose name is Ye, is just the latest in a long list. But in some ways it represents the most spectacular of these explosions.

What sets the 45-year-old Grammy winner and fashion entrepreneur apart isn’t just his hateful anti-Semitism and erratic outbursts, often taunting his own sponsors. Nor the corporate rush to avoid a partner once prized: by his bankers at JPMorgan, lawyers at Greenberg Traurig, agents at CAA and his fashion partners at Gap, Adidas and Balenciaga, among others.

What West’s case really shows is how high the stakes have become for companies in the brand building game. When Adidas split from West’s Yeezy fashion empire, it wiped as much as 250 million euros from its bottom line. It was more than wasted marketing expense; it was a core part of Adidas’ business.

These kinds of deep partnerships have a totemic precursor: the Nike deal with Michael Jordan that remade the sportswear and sponsorship business. In 1984, Nike was an insurgent brand looking to hitch a ride on the wings of a promising basketball talent. Along with a hefty annual payout, Nike executives wooed Jordan with a plan to build a shoe around his brand and give him a share of the benefits.

It was more of a marriage than a passing transaction. When Jordan and his parents first visited the company’s headquarters in Beaverton, they were greeted by a giant banner: “THE NIKE FAMILY WELCOMES THE JORDAN FAMILY.” Almost four decades later, Nike still releases an Air Jordan every year.

Kanye’s fashion breakthrough also came from Nike – the Air Yeezy. The prototype, which West wore to the Grammy’s, fetched $1.8 million at a private sale; its successor sold out in 10 minutes when it was released in 2014, priced at $245. The line was rare, exclusive, what the fashion industry might call a “capsule collection”.

The challenge was to give it an industrial scale to produce for a mass market. Adidas got it. West tried with Nike, but was told he couldn’t go beyond his existing library of shoe molds. Adidas, on the other hand, promised to create new shapes and gave it a hefty royalty to boot. “Tell Adidas we need a million in production (you!),” West rapped in the track “Facts.” “I told you all I needed was the infrastructure (Boom!)”.

There were obvious risks to working with Kanye even then. But Adidas couldn’t resist. Few stars can pull off this kind of strategic partnerships; Singer Rihanna’s Fenty Beauty adventure with LVMH is a rare case.

Would Adidas roll the dice again with another star? In the 80s and 90s, edgy brands hired private investigators to examine celebrities before endorsement deals. When Japanese whiskey company Suntory considered hiring Rat Pack star Peter Lawford, it even sought to establish if he had a drinking problem.

Today, it’s more lawyers than private investigators. West may own the Yeezy brand, but it’s Adidas that claims to be the “sole proprietor” of the underlying shoe designs.

It talks about the balance of power. Adidas had been looking for a tastemaker with electric and unpredictable energy. He got that in spades. Great companies are damaged when their famous partner implodes. It can be costly. But they survive and move on, always worried about looking stale.

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