By Patricia Odell
When T-Mobile signed actress Catherine Zeta-Jones as its spokesperson, it gave her unlimited service and an armload of devices, offering her every opportunity to use the products, both in public and in private. The deal included language that she would use her best effort to dissuade producers from using competitive products in any of her films, and the two camps even agreed on the specific model of plane she would fly in based on whether she was traveling under or over four hours.
There's no doubt that signing celebrities as spokespersons comes with its challenges. The glam squad, the security details, the requests for everything from private jets to shuttle them back and forth from shoots or personal appearances, to the approval of images— to mention haggling over compensation— give even the most steady legal eagle a migraine.
During the PMA Law Conference, held earlier this month in Chicago, four attorneys laid out the multi-pronged ins and outs of dealing with major entertainment and celebrity icons.
When consumers watch a TV commercial or look at a print ad or promotion featuring Zeta-Jones, the impression is that she is in favor of the brand. That's why the brand can only use the endorsement of a celebrity if that person subscribes to their views, views that need to be periodically reviewed to make sure that person is still in tune with the brand. Steve Katleman, partner, Greenberg Traurig, recommended asking for an affidavit that shows that the talent uses the product.
And the choice of who best fits the brand can be tricky. The person needs to be appealing to the target demographic of the product and be able to stir an emotional connection with the consumer. Do they have similar corporate values with other endorsements? It's important to look at that celebrity's public image, as well other deals— and current— avoid an embarrassing situation like the one between Madonna and Pepsi, said Joseph Kim, senior counsel, Pepsi-Cola Co.
Shortly after Pepsi signed Madonna in the early 1990s to a multi-year endorsement deal the first thing it did— great enthusiasm— to produce a TV commercial featuring the star. Shortly after the ads debuted, so too did Madonna's music video Like a Prayer, considered to be her most scandalous. The images showed her kissing a black saint and dancing in front of a field of burning crosses. Needless to say, she wasn't wearing much and there was a mountain of press and backlash against the video. Pepsi had no choice but to pull the campaign.
"That's a situation where it would have been nice to know what else she was working on," Kim said.
Another venue for checking out talent is to ask the public relations department to vet the talent's image. At the very least, take a look at news reports and blogs. If it's a musician, for example, listen to the lyrics he or she delivers. Last August, Ford Motor Co. was set to place its 2006 Ford Fusion in an Eminem music video, but suddenly said "no thanks" to the rapper when it learned more about the featured song, Ass Like That. Ford spokesman Dave Reuter said at the time that the video and lyrics were not an "appropriate" place for Ford to voluntarily place a vehicle.
"It's critically important to do a background check on talent," Kim said. "If you don't discover problems before the deal, the tabloids will certainly discover them after the deal is signed."
"You're going to be living with that person for two or three years," added Jeff Matloff, senior corporate counsel for T-Mobile USA, Inc. "It's not like a movie shoot where you only have to put up with them for a few weeks."
Also considered is timing and access to the talent, points often heavily negotiated. Are they on tour or making a movie outside the U.S.? Do they have previous commitments? Compare notes on when they would be needed for TV shoots or personal appearances. Contracts are typically limited to a set number of days of access and it can be important to break it down per year, or even per quarter. A brand's strategies may change quickly based on overtures by competitors and campaigns may need to be updated every few months. T-Mobile checked with Zeta Jones on her movie and TV commitments over a two-year period, Matloff said.
Additional details such as breaking down the days the brand has access to the talent can be critical, Matloff said, including how many days for print or TV shoots, personal appearances and any special requirements such as wearing or eating a brand's products, are needed.
"[It's important] to contractually obligate the celebrity to interact with your product," Greenberg Traurig's Katleman said. "They want to take the money, but they may not want a lot to do with the product."
For example, for McDonald's it's key that an endorser be willing to "bite and chew" on camera, if not, it could kill the deal, said Shelia Lehr, managing counsel, McDonald's Corp. (Katie Couric could likely never sign with McDonald's since she chastises the cameraman if he moves in for a close shot while she is tasting something).
The use of the talent's name and likeness rights is another key issue, the attorneys said.
T-Mobile's Matloff says it's important to obtain the broadest rights possible for the name, likeness, voice, image and biographical data for use in all media. He said the actor likely will want to approve what images are used and that the deal should call for approval of a minimum number of photos (25% to 50%) so that the turnaround time is reasonable. And, that once those images are approved, that they can be used for any and all purposes.
"The marketing team is going to be on a fast track to get the ads out there," he said.
Another heavily negotiated point is category exclusivity. Pepsi certainly doesn't want to see one of its paid endorsers caught on tape drinking a can of Coke and it makes that clear in its agreements. It precludes advertising for competitors and prohibits the public use of competing products. The same goes for McDonald's. It doesn't want its paid spokespersons to eat at competitive restaurants, Lehr said.
As for compensation, one point is clear, the more prominent the movie star, pop artist or athlete, the more it will cost and can even inflate the price of the deal. Some like to be paid upfront, but brands like to hold some back.
"We want to spread it out; tie the payments to completion of milestones to leverage cooperation and perform the way they're supposed to under the agreement," Kim said.
A number of special requirements are often negotiated under the "compensation" umbrella, such as whether the talent will fly luxury or coach, commercial or private aircraft (most want private) how many people they will bring along (glam squads and security details)
A clause should also be included in agreements that cover the scope of approval rights. If the talent and the reps are on the road and the brand needs quick approval there needs to be a plan.
"There needs to be a clause that says if we don't hear back within a certain time, it's deemed approved," Lehr said. "You've got deadlines, you've got a business to run. It's important to have that clause."
And then there's the morals clause. If the celebrity endorser is causing damage to the brand or its image, there needs to be a way out.
"This is an area where things do happen," Lehr said. "You think someone is clean cut and then they go and do something like pull the shirt off of Janet Jackson."
