Read the letters @ http://www.berkshirehathaway.com/letters/2009ltr.pdf
Who would be a better endorser than the CEO of the company himself. He is the most credible person in the company. He has highest knowledge about the company's products and knows the needs that those products fulfill.
Now this brings us to the question, that if such a celebrity is already present than why do companies go for actors and players.
Well, there can be many reasons, but the two most important reasons I can think of are:
Product characteristics and Awareness in general public.
By product characteristic I mean that, if you want Celebrity for a sport shoe ad, it will definitely be a sport person and not a fat CEO. Similarly for a beauty product it would be a good looking model and not a person with big, fat glasses.
Another important point here is awareness in public, this is important because we believe only them whom we know. If we don't know someone how can we believe him, what will be the basis of credibility.
But, the second problem can be solved; by giving more and better exposure to the CEO a company's PR department can have a potent tool. This can be done in many ways, depending on the business again and this will increase the credibility of business as a whole which might positively effect the perception towards products.
Its not a completely new idea. Many CEOs are doing it, unknowingly though.
For eg. can't a person say that Kingfisher's products will fall in premium category just by knowing about Vijay Mallya or Virgin's products will attract the younger audiences by knowing about Richard Branson. Or can't people just invest in the stocks Warren Buffet invests in, they can and they do.
But still there are only very few examples, the reason being, CEOs are infamous for filling their pockets and leaving shareholders and customers empty handed.
This is perfectly described in the famous joke :
there were 3 CEOs in a plane. To test them, they were told that the engine in this plane was made by their company. 2 of them immediately got down out of fear, but one didn't. When he was appreciated about his confidence in his company's products, he said: Well, yes I have full confidence in my company's products, I knew if it was from my company, it would never have started.
So, if companies are able to develop trust in public for their CEOs, they can be an effective and efficient tool to not only attract customers but also shareholders.
