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Home , Alia Bhatt, Bipasha Basu, Hrithik Roshan, Parineeti Chopra, Preity Zinta, Punjab Kings in 2021

Rise of the Millennials ’S MOST VALUABLE CELEBRITY BRANDS

DECEMBER 2017 Table of Contents

India’s most PREFACE Rise of the Millennials 3 valuable celebrity brands SUMMARY Celebrity Brand Values 4

INTRODUCTION Celebrity Endorsements in India 5

UNDERSTANDING ENDORSEMENTS: Overview of Celebrity Endorsements 8 Current Celebrity Endorsements 12

RECENT TRENDS Rise of Millennial Endorsers 14 Celebrities endorsing tourism campaigns 15 Increasing Celebrity backed sport tournaments 16 Growing appeal of Sportswomen 17 Celebrity backed merchandising brands 19

METHODOLOGY Our Approach and Methodology 21

CONCLUSION 24

Duff & Phelps 2 PREFACE Rise of the Millennials

Dear Readers,

It gives me great pleasure to present the third edition of our report on India’s most valuable celebrity brands. The theme of this year’s report, ‘Rise of the Millennials’, recognizes the ascent of millennial celebrity endorsers to the top of our brand value rankings. India currently has a millennial population of around 400 million and is expected to become the youngest country in the world by 2020 with a median age of 29. India’s millennial population is experiencing high growth in disposable income levels and thus, it is increasingly becoming crucial for companies to add endorsers who can influence this segment of the population. Varun Gupta Managing Director For the first time since inception of our rankings, Shah Rukh has slipped from Duff & Phelps India the number one rank, replaced by , who has become the primary choice of product brands to engage and attract consumers. This can be attributed to his extraordinary on-field performances and off-field charisma. In addition to Virat Kohli, other young celebrities such as , and P.V. Sindhu have either risen in rankings or entered into our top 15 list, backed by impressive performances in their respective fields and strong endorsement signings over the last year. veteran had a great year and rose in our top 15 rankings from thirteenth rank in 2016 to fourth rank in 2017, as a slew of companies rushed to sign him. The overall brand value of the top 15 celebrities is $712 million. In our 2016 report, we had recognized the growing trend of celebrity brand extensions and co-ownerships. Given the recent success of celebrity co-owned brands such as Hrithik backed HRX and Virat Kohli backed Wrogn, this trend seems to be shaping up well in the fashion industry and product brand endorsement space in India. It has been an exciting year for Duff & Phelps in India. This report follows the release earlier this year of the fourth edition of our report on brand values in the ‘The Decade Edition’. The report was very well received by our readers and the media. We hope you find our analysis interesting and we look forward to your feedback.

Yours sincerely,

Varun Gupta

Duff & Phelps 3 SUMMARY Celebrity Brand Values

In our 2017 Celebrity Name 2017 Brand Brand Value 2016 Brand 1 celebrity brand Rank ($ Million) Rank value rankings, Virat Kohli 1 $144 2 Virat Kohli 2 $106 1 surpasses Shah 3 $93 3 Rukh Khan for Akshay Kumar 4 $47 13 the first time. 5 $42 7 Also, P.V. Sindhu makes an entry 6 $39 4 into the list, 7 $38 8 marking the first 8 $36 10 time a female Alia Bhatt 9 $34 14 sportsperson Varun Dhawan 10 $32 New has made it to Ranbir 11 $27 6 the top 15. 12 $22 5 Total value Mahendra Singh Dhoni 13 $21 9 of the top 14 $16 12 15 celebrity P.V. Sindhu 15 $15 New brands: US$ 712 Millennials million

(1) Previous rank as determined in the second edition of this report titled Embracing the Change, published in 2016

Duff & Phelps 4 INTRODUCTION Celebrity Endorsements in India

Who would you like to buy your sports Typically, endorsement deals are Celebrities are clothing from? A next-door shopkeeper or structured as either fixed fee per period believed to feature from the sportswear chain owned by the or on the basis of appearances in legend, Tendulkar. Even promotion events. Recent deals are also in close to 50 though the products would have incorporating a social media component percent of all comparable price, quality and durability, a in order to leverage the huge following of normal consumer would always prefer celebrities on , Facebook and advertisements buying a product endorsed by a . renowned and credible source, aired in India, somebody who you have prior opinions Taking cues from their international compared to only and conceptions about as compared to a counterparts, Indian celebrities are random individual. The psychological increasingly launching their own clothing 20 percent in the principle of classic conditioning ensures and accessory lines to monetize their United States that we as humans interpret the product brand equity. These labels are typically brands to have the same qualities and launched in partnerships with appeal as the person who sells it. Ergo, merchandisers, designers or retail firms, celebrity advertising. and celebrities try to align the product’s identity with that of their own. These The concept of celebrity endorsement in labels, if successful, are expected to the Indian marketing and advertising outlast their careers, especially for industry is deep rooted. The logic is sportspersons. basic. People in India idolize celebrities, so when renowned personalities associate themselves with a product, people tend to gravitate towards that product intentionally or unintentionally. While in the West, celebrities ’t have a major influence on consumer spending.

Based on our discussions with talent and advertising agencies, celebrities are believed to feature in close to 50 percent1 of all advertisements aired in India. This is relatively high compared to the U.S. where only approximately 20 percent2 of advertisements feature celebrities.

(1) Why celebrities in India have runaway success with brand endorsements, by The Financial Express (2) The Economic Value of Celebrity Endorsements, by Anita Elberse and Jeroen Verleun, by The Journal of Advertising Research

Duff & Phelps 5 INTRODUCTION

Marketing and As per FICCI-KPMG, the Indian Media 15 -17 billion for 2016 as FMCG and Entertainment (M&E) industry companies had to cancel or postpone ad advertising generated INR 1,262 billion ($19 billion) campaigns and product launches. Due to in 2016 and recorded a modest growth of negative consumer sentiment, the print spends 9 percent over 2015. The industry is industry also suffered resulting in a experienced a segmented into TV, Print, Films, Digital negative growth of 3 - 5 percent due to advertising, Animation and VFX, Gaming, withdrawal of advertisements by downward pull OOH (Out-Of-Home Advertising), Radio, companies. The movie industry also in 2017 as the and Music segments. witnessed a downfall. However they tried to maintain customers by cutting down main Overall the Indian advertisement transaction fees and encouraging digital spending in 2016 increased by 11 payments. The estimated effect of consumption percent to INR 528 billion ($8 billion). The demonetization by sector is provided sectors were advertising revenues constitute about 34 below. and 66 percent of the TV and print Sector Negative impact of impacted by revenues respectively. The performance Demonetization on demonetization of the advertising segment is linked to consumer demand especially in large advertising revenues spending segments such as fast-moving in 2016 consumer goods (FMCG), consumer TV 2% durables, auto, financial services and Print 1 - 1.5% insurance. As the main consumption sectors such as FMCG and consumer Films 5% of domestic durables were impacted by theatricals demonetization, marketing and Radio 2 - 3% advertising spends experienced a downward pull as well. Goods & Services Tax (GST) GST is expected to be a boon for the Effect of Demonetization M&E sector due to the creation of a Demonetization resulted in a cash crunch simplified tax structure. It benefits the which reduced consumption and resulted sector mainly due to availability of input in lower spending in the M&E sector. credits across the board and inclusion of Since it was announced near Diwali, the entertainment tax within the ambit of advertising revenues suffered mostly GST. But due to GST being at its during December. Even though there was inception, companies will have to modify a rise in advertisement spending by the their operating models to adjust with the e-wallet companies, the entire advertising destination based taxation policy. sector suffered an estimated loss of INR

Advertising Industry Size (INR billion)

Growth % 11% 11% 6% 28% 7% 15% 528 475

181 201 189 201 60 77 24 26 20 23

Total TV Print Digital Advertising OOH Radio 2015 2016 Source: KPMG FICCI Report on the Media and Entertainment Sector 2017

Duff & Phelps 6 INTRODUCTION

The total M&E market is projected to market entrants like , Amazon Digital advertising grow at a compound annual growth Prime accompanied with is expected to rate (CAGR) of 14 percent over domestically built , VOOT, 2016-2021, while advertising and Ozee are all revamping their drive growth in revenues are projected to grow at a existing models to make the most the adverting CAGR of 15 percent over the same out of digitalization. Another period. This growth is despite the contributor to increasing digital industry with 31 negative effects of demonetization traffic is the ‘Digital India’ initiatives and early hindrances in GST introduced by the Government. Free percent CAGR implementation. Wi-Fi hotspots across the country, over the period equipping village panchayats with Digitalization common key centers and boosting 2016-21 IT ventures by providing funding The mobile internet and smartphone through various schemes are a few phenomena is exploding rapidly in highlights. India and paving the way for digitalization which India had hoped Digital advertising is expected to for all along. Consumers have cross INR 295 billion ($4 billion) in shifted from television screens to 2021 where mobile will be the key mobile screens and this has led to channel. Advertising using video growing interaction via digital segment is highly preferred by platforms. With Reliance Jio marketers given better internet entering the market and capturing a speeds and affordable data rates. major consumer base from its YouTube is a big contributor to this competitors, data prices have been trend as a lot of youth are attracted slashed and 4G connectivity has to this mode of advertising. improved remarkably which Campaigns such as #PepsiMoji by indicates a huge potential for digital Pepsi, Unboxing of OnePlus platforms to attract more media smartphone featuring Biswa Kalyan consumption. Hence, advertising and #MPMeinDilHuaBachaSa by revenues on digital platforms are Madhya Pradesh Tourism attracted expected to show rapid growth with eyeballs on YouTube and went viral. a CAGR of 31 percent during 2016- Further, social media websites like 2021. Facebook and Instagram are also generating huge advertising The OTT (Over the Top) Video on revenues because of target Demand (VoD) channels have also audience presence. expanded their consumer base because of digitalization. New

Advertising Industry Projected Growth (INR billion)

CAGR % 15% 14% 8% 31% 12% 16% 1,078

528 394 296 295 201 201 77 26 46 23 48

Total TV Print Digital Advertising OOH Radio 2016 2021 Source: KPMG FICCI Report on the Media and Entertainment Sector 2017

Duff & Phelps 7 UNDERSTANDING ENDORSEMENTS Overview of Celebrity Endorsements

Endorsement Deal Structure a celebrity for a specified event. This may Common models be in the form of a single advertisement for celebrity The first step in building a methodology to or a photo shoot or even an event assess celebrity brand values is to attendance. A celebrity may also be cast endorsement understand how celebrity endorsements as “acting talent” for a specified deals include are structured. Based on our analysis, we advertisement. Such engagements are understand that a celebrity may be charged for daily, with the rates being fixed term engaged by a corporate or an advertiser significantly different for annual contracts in two key engagement models. In the versus one-time endorsements. contracts and first and most common model, a celebrity one-time will be contracted for a specified term Apart from the cash payments that (usually one or two years) for a fixed-fee celebrities receive, their endorsement appearances for payment that may be made through an contract may also include an in-kind specified events initial signing amount with the balance payment. The product being endorsed is upon completion of specified activities. supplied to the celebrity for free for a These agreements may also involve a specific term. This is prominent in high royalty component. Recently, end luxury brands. On its 10th signed Virat Kohli in a deal which anniversary in India, the German car involved a fixed payment and royalty maker, Audi, gifted a white Audi Q7 to depending on the company's business Virat Kohli as a token of his loyalty to the performance. These celebrities are company. Often celebrities who endorse referred to as brand ambassadors owing luxury fashion brands are spotted to their long-term association with the wearing them to enhance the appeal of endorsed product. the product (e.g., for Longines). Normally, an annual endorsement contract includes the celebrity’s The contract may also have additional availability for a two to four-day period sweeteners which cover all expenses (eight hours a day), during which time the incurred by the celebrity during the advertiser may schedule an event, photo production of the advertisement. For shoot or ad shoot as the campaign may example, expenses related to first-class require. The content that the advertiser airfare, hotel accommodations and luxury generates during these activities may be meals. The endorsement deals may also used within the contract term. Of course, provide for insurance of the celebrity, exclusivity provisions also ensure that the such as commercial general liability celebrity for a period may not promote a insurance, which is issued to cover them rival product brand after contract against any injuries arising during the termination. However, it is not uncommon shoot. Alternatively, the terms may for the exclusivity provisions to be bought include, an umbrella liability insurance, out by rival advertisers. which protects the celebrity from certain personal liability situations that may arise The second, but less popular form of because of the endorsement. Duff & Phelps engagement is a one-time appearance by 8 UNDERSTANDING ENDORSEMENTS Overview of Celebrity Endorsements

Social Media Influence As per Forbes, the Indian Cricket Team Product Brand , Virat Kohli, earns INR 32 endorsements Companies and advertisers may sign a million per product brand with 17 million celebrity for individual campaigns to followers on Instagram. Until December through social create social media buzz. Celebrities 2017, his sponsor branded posts media campaigns may also create awareness among the numbered around 60. He is the only masses for a non-profit initiative. Indian athlete who commands such a are increasingly joined a social campaign high fee. in 2017 to create awareness about becoming a norm saving water on the eve of World Earth Other celebrities who have signed in the advertising Day. The campaign titled ‘Mission Blue’ social media endorsement deals was launched by National Geographic include and Saina world in association with NGO Water Aid Nehwal who promoted Starbucks on Foundation. Deepika Padukone Twitter, and who tweeted founded The Live Love Laugh about Chola (fashion brand), Veeba Foundation, to fight depression after foods (food brand), fashion magazine she herself came out to speak of how Vogue, Kiehls (cosmetic brand) and she was once a victim. The campaign Renault. named #DobaraPoocho spread across social media like wildfire. Several celebrities promoted the Swachh Bharat campaign launched by the Prime Minister, Narendra Modi. featured as Goddess Laxmi who abandons worshippers who dare to litter in her presence. The advertisement went viral by the name of #DontLetHerGo.

Since consumers perceive the image of celebrities and influencers as per their social media handles, they need to be more attentive towards social media posts by not putting up controversial posts or posts that could jeopardize their public acceptance.

Duff & Phelps 9 UNDERSTANDING ENDORSEMENTS Overview of Celebrity Endorsements

Variation in Endorsement Fees discontinued his relationship with soft The prestige of drink brand Pepsi stating that he would the product brand Interestingly, we noted that the rates only endorse brands with an athletic and charged by celebrities for an annual pro-health image. primarily dictates endorsement engagement significantly the deal value. differ across product brands signed, Under the new guidelines on celebrity even in the same year. This is mainly endorsement by Advertising Standards There is an because certain products are more Council of India (“ASCI”), celebrities will attractive to a celebrity, and their fee for be held responsible for the claims made inverse endorsements will vary by their in ads in which they appear. Due relationship inclination to be associated with a diligence is expected to be carried out to certain product. Some celebrities will ensure that the product / service lives up between the size reduce their endorsement fees for a to its claims, and in no way, should /appeal of the product brand which helps a social deceive the consumers by misstating or cause. Endorsing for a social cause overrating the facts. product brand through campaigns initiated by the government or public/private entities Companies these days modify contract and endorsement increases their credibility and the terms and do not just focus on cash fees charged. likelihood of receiving future product consideration. When Amitabh Bachchan brand endorsement offers. Hence, they was promoting Just Dial, he received an are willing to work for little or no equity stake in the company which later endorsement fees. earned him a positive return once the company had a successful IPO. Health The prestige of the product brand and wellness startup Cure.fit inked a primarily dictates the deal value. There INR 1000 million deal with Hrithik is an inverse relationship between the Roshan for a five-year association size /appeal of the product brand and making it one the largest deals ever endorsement fees charged. Endorsing signed by a startup. The deal includes products dealing with personal care, the actor’s equity stake in the company consumer durables and apparel is often in lieu of cash investment, promotions attached to the celebrity’s status symbol. and royalties from his personal brand Celebrities with a high stature often HRX’s specialized workout plan. This prefer to endorse a company which plan will be introduced across Cult matches their own status. Endorsing a fitness centers operated by Cure.fit. product which can be hazardous to health, such as, carbonated and alcoholic beverages, cigarettes, etc., creates a negative impact on the celebrity’s image. Celebrities charge very high endorsement fees for such products. This year Virat Kohli

Duff & Phelps 10 UNDERSTANDING ENDORSEMENTS Overview of Celebrity Endorsements

Since the image Product Brand & Celebrity Fit drink. of the celebrity Engaging a celebrity for a product brand Switzerland Tourism roped in Ranveer endorsement exercise is not a simple Singh to promote tourism in the country. gets linked with task. The advertiser must first select the Using Ranveer’s energetic persona, the the product being celebrity based on his or her fit with the campaign is trying to engage audiences organization or the product. The next with a variety of outdoor adventure endorsed, the step involves working with a celebrity activities available in the country. management agency to finalize the advertiser must details of the agreement, including the On the other hand, Priyanka Chopra, who select the right signing amount and the period of has been recently been occupied with engagement. A percentage of the Hollywood productions, has not been celebrity based celebrity’s endorsement fee then able to sign any new product brand on his or her fit becomes payable to the agency as a endorsement deals over the last year in commission for the services they provide. India. Additionally, her last hit movie was with the , which was released in Recently, Virat Kohli signed a deal with 2015. Given her lack of Bollywood and positioning and German shoemaker brand Puma. The media presence in India, she has lost values of the deal is expected to create an image of some of her endorsements to younger strength and agility for the Puma brand celebrities who are more connected with product and encourage sports enthusiasts to try the Indian audience. Puma branded merchandise. As per Abhishek Ganguly, Puma India MD, “Virat has transformed the way fitness is looked at in Indian cricket. He has Product Current Previous emphasized the role of an athlete and Brands Endorser Endorsers reshaped cricket in the millennial culture, Head & Ranveer Singh thus endorsing our brand ethos. He is a Shoulders youth icon with an effortless style.” During the launch of his sports clothing Thums Up Ranveer Singh Salman Khan brand ‘One8’ in association with Puma, Lays he stressed the importance of a healthy lifestyle. Tag Heuer Ranbir Kapoor Shah Rukh Khan

Parle Agro roped in Alia Bhatt for its Philips Alia Bhatt Kareena Kapoor Frooti Fizz product as part of a rebranding effort, in order to position the Garnier and Alia Bhatt Priyanka Chopra product as a fun and naughty mango Hero

Duff & Phelps 11 UNDERSTANDING ENDORSEMENTS Current Celebrity Endorsements

As part of our analysis we analyzed the top 25 Bollywood celebrities and sportspersons. These celebrities endorsed over 300 product brands in 20 different industry segments over the twelve months ending 2017. Some of the key highlights of the research are presented below:

Top Segments Using Celebrity Endorsers

Food & Personal Care Automobiles Smartphones Clothing Beverages

Top Advertising Product Brands

Colgate Coca Cola Hero Gionee Aerobook Aqualite Cadburys Honda Jivi Mobiles Caprese Lakme Kwality Maruti Suzuki Oppo Dixcy Scott Pantene Lipton TATA One Plus Dollar Club Veet Maaza TVS Vivo Rupa

Top Endorsers

Alia Bhatt Akshay Kumar Akshay Kumar Amitabh Bachchan Akshay Kumar Anushka Sharma Alia Bhatt Amitabh Bachchan Alia Bhatt Alia Bhatt Amitabh Bachchan Deepika Padukone Ranbir Kapoor Deepika Padukone Hrithik Roshan Ranveer Singh Salman Khan Ranveer Singh Varun Dhawan Varun Dhawan Ranveer Singh Shah Rukh Khan

Source: TAM Media Data for the period September 2016 to October 2017, Duff & Phelps Analysis Rankings are based on Secondages on TV; secondages means the number of seconds the celebrity appears on TV for a particular product brand

Key Sector Trends: • Automobiles, Direct-To-Home, Real Estate, Tourism and Healthcare segments are dominated by male endorsers while Personal Care and Food & Beverages segments are primarily dominated by female endorsers. • Smartphones and Clothing replaced E-commerce and Jewelry in the top five segments which use celebrity endorsements. • Alia Bhatt featured as a top endorser in four of the top five segments. • Varun Dhawan, a new entrant in our top 15 list, featured as one of the top five endorsers in two of the top five segments.

Duff & Phelps 12 UNDERSTANDING ENDORSEMENTS Current Celebrity Endorsements

Celebrity Endorsements by Sector

Sectors dominated by female celebrities1 Sectors dominated by male celebrities1

Personal Care Food & Beverages Automobiles Direct-To-Home Female Female 1% 0% Male 45% Female Male 55% 44% Male Female 99% 56% Male 100%

The top two segments dominated by Overall, female celebrity brand values The number of female celebrity endorsers are Personal contributed 25 percent of the total brand products Care and Food & Beverages. As per our value of the top 15 celebrities. Alia Bhatt analysis, Personal Care segment led the pack, adding two personal care endorsed by the contributes 50 percent of total celebrity brands, a food & beverage brand and an top 15 celebrities endorsements in India, and hence is of e-commerce brand to her portfolio. critical importance in the endorsement has seen ~14 space. On the other hand, Automobile We also observed that most of the top and direct-to-home (DTH) segments segments such as Personal Care, Food & percent growth mostly featured male celebrities in Beverage, Automobile and Smartphones over the last year television advertisements. have millennial endorsers.

Total # of Product Brand Endorsements by Top 15 Celebrities2 Product Brand Endorsements by Top 5 Celebrities2

# of Product Brands Rank Celebrity Endorsed as of October 2017 2016: 2017: 1 Virat Kohli 20 205 234 2 Shah Rukh Khan 21 product product 3 Deepika Padukone 23 brands brands 4 Akshay Kumar 18 5 Ranveer Singh 21

Total 103

(1) Source: TAM Media Data; charts are based on Secondages on Television during the period of September 2017 to October 2017 (2) Analysis based on endorsements for top 15 celebrities

Duff & Phelps 13 RECENT TRENDS Rise of Millennial Endorsers

India is expected to become the youngest replaced her idol Kareena Kapoor as the Rising incomes of country in the world by 2020 with a ambassador for Philips. She also India’s millennials median age of 29. The upcoming replaced Priyanka Chopra for Garnier. generation has a higher earning capacity offer and a different lifestyle as compared to The food segment also shows similar unprecedented their predecessors. This offers trends. was replaced by unprecedented opportunities for in the Kurkure ad for opportunities for consumer industries such as auto, her young and sprightly image. Similarly, telecom, finance, luxury products and real Lays Chips’ previous ambassador Saif Ali celebrity estate. Accordingly, most of the large Khan was replaced by Ranbir Kapoor. endorsements in companies are either replacing their current brand ambassadors or adding Anushka Sharma has been featured in a consumer endorsers which the millennial population lot of commercials by replacing industry industries such as would better identify with. veterans. She became the brand ambassador for Clean & Clear, replacing auto, telecom, This year, the beverage industry leader and , who Coca Cola decided not to renew its were associated with the product for a finance, luxury contract for Thums Up brand with considerable number of years. Her products and real megastar Salman Khan for the first time approachable attitude also got her the since 2012. Instead they decided to sign TVS Scooty ad, which was previously estate Ranveer Singh who symbolizes youth, exclusively endorsed by . and thus fits better with the Thums Up brand. Similarly, Honda decided to If we look at the smartphone category, it appoint upcoming actress Tapsee Pannu is entirely endorsed by millennial as the brand ambassador for scooters celebrities including Alia, Deepika and targeted at young riders. Ranveer. It is evident that companies want to have a greater focus on youth, Skin care giant Garnier appointed Tiger hence they feel that the face of their Shroff as their new brand ambassador, product brand should be a person with a who will now be seen promoting the youthful image to connect well with the product brand alongside John Abraham their target audience. and . Garnier associates with having natural, sporty, action oriented, adventurous and fun traits. Alia Bhatt

Top 15 Celebrities Brand Portfolio Share of Millennials in Top 15: Millennials: Top 15 Celebrities 234 149 Brand Portfolio product product brands brands (64%)

Duff & Phelps 14 RECENT TRENDS Celebrities endorsing tourism campaigns

Foreign countries The travel and tourism industry has top tourist destinations with the highest been a significant economic driver and travel searches of 52 percent. They such as accounted for 10 percent of the total have hired Malhotra as their Switzerland and GDP in 2016. While the advertising official ambassador, and the India-New from mainstream companies witnessed Zealand tourism corridor is expected to New Zealand are a sluggish growth, the tourism industry expand further. Moreover, his travel took a step forward and appointed diaries were documented and increasingly celebrities for their respective showcased on the official website of engaging with geographies. This is to lure India's New Zealand. burgeoning middle class which is Indian celebrities, travelling abroad in growing numbers, In 2016, Superstar Shah Rukh Khan especially expected to reach 50 million by 2020, also partnered with Dubai tourism to up from 20 million in 20141. promote it as the land of joy and Millennials, to adventure. He engaged in a series of Renowned and credible Indian short films to conceptualize and attract tourists celebrities are being hired by various promote tourism to the Emirates with traveling from tourism departments across the globe. the theme #BeMyGuest. Previously, only Indian states used to India appoint Indian celebrities as their state Celebrity Country / Campaign/ tourism ambassadors. The celebrities Name City Positioning are selected based on their ability to Endorsed appeal to three audiences: family, luxury and millennials. Ranveer Switzerland #InLoveWithSwi Singh tzerland Bollywood’s livewire actor Ranveer Siddharth New Zealand Brand Singh was recently named the Indian Malhotra Ambassador ambassador for Switzerland Tourism Shah Rukh Dubai #BeMyGuest for the campaign “Nature wants you Khan back”. With his energetic persona, he is being positioned to attract audiences for outdoor adventure activities in the country.

According to Skyscanner, New Zealand has emerged as a winner for

(1) France hopes new Bollywood movie shot in the Cote D'Azur and Paris will lure Indian tourists after drop in visitor numbers following terrorist attacks, by Mail Online

Duff & Phelps 15 RECENT TRENDS Increasing Celebrity backed sport tournaments

With a strong craving for a healthy fan following made him a good fit for Increasingly, lifestyle, celebrities and the title. celebrities are sportspersons are increasingly promoting a variety of new sport In 2016, the Premier Badminton backing and/or formats. League (PBL) announced Akshay Kumar as its official ambassador. He endorsing new Indian cricketer engaged with his followers by sports formats contributed towards a crowdfunding actively posting updates on his project aimed at promoting Kabaddi social media handles and blogs and such as Kabaddi in India among different states, and by doing podcasts on the and Football, encouraging people to look at the tournament. Dr Akhilesh Das Gupta, sport with passion and pride. Cricket President BAI and Chairman PBL among others legend has on stated that the main reason for many occasions spoken about his getting Akshay on board was for love for football, and actively creating excitement among the promotes the . target audience.

In fact, Bollywood celebrities also Increasingly, Bollywood and sports have made active appearances in celebrities are also investing in sporting events. The Indian Olympic franchises of different sports leagues Association appointed Salman Khan such as the Pro-Kabaddi League as India's Goodwill Ambassador for and Indian Super League (soccer), the 2016 Rio de Janeiro Olympics as as highlighted in the table below. they considered him a youth icon. Salman’s media presence and huge

Celebrity Sport Investee Franchise

Football Chennaiyin, Indian Super League Kabaddi Pink Panthers, ProKabaddi League Football Pune City FC, Indian Super League Hrithik Roshan Football Pune City FC, Indian Super League John Abraham Football Northeast United, Indian Super League Mahendra Singh Dhoni Football Chennaiyin, Indian Super League Preity Zinta Cricket Kings XI Punjab, Indian Premier League Ranbir Kapoor Football City FC, Indian Super League Sachin Tendulkar Football Kerala Blasters, Indian Super League Shah Rukh Khan Cricket Knight Riders, Indian Premier League Virat Kohli Football FC , Indian Super League

Duff & Phelps 16 RECENT TRENDS Growing appeal of Sportswomen

The growing clout of sportswomen in golfer Aditi Ashok qualified for the final. Sportswomen In India, both in terms of recognition and Clearly, women athletes are on the rise India are building product brand endorsements is quite and are making history. remarkable. Their product brand their presence in endorsements have penetrated the These achievements and accolades the product brand territory currently dominated by cricketers earned these sportswomen public them and Bollywood stars. Female athletes are respect and recognition, and companies endorsement today emerging as the first choice to feel that their struggles and successes promote fashion, banking, health and makes them the obvious choice for territory, currently home products, as they are achieving promoting their products. dominated by success like never before. After winning a silver medal at the Rio Bollywood stars In the 2016 Rio Olympics. P.V. Sindhu Games, Sindhu inked a INR 500 million and cricketers became the youngest Indian ever to win endorsement deal with Baseline an Olympic medal. Her list of recent Ventures, a sports marketing, achievements is noteworthy, including entertainment and brand licensing firm. winning gold medals in China Open This is the highest contract ever offered Super Series 2016 and Macau Open to a non-cricketer sportsperson in India. 2013/14/15, silver medals at the BWF In addition to Baseline Ventures, she also World Championships 2017 and Glasgow endorses various companies/ products World Championship 2017, and including Apis Himalaya Honey, Bank of becoming the World’s third ranked Baroda, Bridgestone India, Gatorade, badminton player. Moov, Myntra, Ojasvita, batteries, Vizag Steel and Yonex. She The Indian women’s cricket team left no has firmly stated that she won’t be stone unturned and emerged as runner promoting any product which has a up in the ICC World Cup 2017. The team negative influence on health. Sindhu also was led by who received endorses Vizag Steel, a product brand global accolades, and team member which is perceived to have a masculine Harman Preet Kaur was felicitated with persona. But as per the company, the prestigious Arjuna Award for Cricket Sindhu, with her consistent performance for 2017 for her commendable brings in the “nerve of steel” factor for this performance in the tournament. product.

Sakshi Malik became the first Indian The highest run scorer in women’s one- female wrestler and the fourth Indian day international cricket, Mithali Raj along woman to win an Olympic medal. Dipa with Harmanpreet Kaur have started Karmakar, India’s first female gymnast at gaining recognition from the corporate the Olympics, missed out on a medal, world and are being considered for finishing fourth in the women's vault promoting electric products and financial gymnastics, but still ended up winning the services. Some production companies hearts of the nation. have made enquiries for a biopic movie deal with Raj. Recently, Lia Agarbathi of In other, more modest achievements, NR group has hired Raj and Arunima long-distance runner Lalita Babar Sinha (the first female amputee to climb became the second Indian woman to Mount Everest) as its brand qualify for the final of track and field event ambassadors. at Olympics, finishing 10th in the 3,000 meter steeplechase final, and teenage Duff & Phelps 17 RECENT TRENDS Growing appeal of Sportswomen

Saina Nehwal entered the big league and Commonwealth Games. Their fan of the endorsements space after following increased with the release of signing a INR 120 million, 3-year their biopic ‘Dangal’ which starred sponsorship-cum-endorsement deal Amir Khan. The South Municipal with financial services group corporation roped in the sisters as Edelweiss. She currently also brand ambassadors to promote endorses Herbalife, Huawei Honor Swachh Bharat Abhiyan. and Savlon. Padmashree award recipient Deepika Indian freestyle wrestler, Sakshi Kumari became the brand Malik, after winning a bronze medal at ambassador for Tuberculosis Free the 2016 summer Olympics signed up campaign in 2017. She several deals and endorsements such has secured multiple gold medals in as the Beti Bachao, Beti Padhao archery globally. initiative and Nissan’s Datsun. But there is a flip side to the , a lawn tennis aficionado endorsements of sportspersons as became the first Indian to be ranked unlike movie stars, sportspersons World No. 1 in WTA's doubles have a limited shelf life. This means rankings and won the Padma that their on-field performance and Bhushan in 2016. She endorses their form have a direct impact on products like FabB and Vencobb their life span as a brand ambassador. Chicken. She is also the brand Typically, endorsement contracts ambassador for the State of diminish after their career comes to an Telangana. end, or for that matter, even when their form drops. However, given the Geeta Phogat and Babita Kumari current rise in on-field performance of Phogat demolished all stereotypes by Indian women sportspersons, they are bringing laurels to the nation in the bound to make big strides in the field of wrestling. Their victories endorsing world. include Asian wrestling championship

Name Sport Product Brands Endorsed P.V. Sindhu Badminton Apis Himalaya Honey, Bank of Baroda, Bridgestone India, Gatorade, Moov, Myntra, Panasonic Batteries, Ojasvita, Vizag Steel, Yonex

Mithali Raj Cricket Beti Bachao Beti Padhao Campaign, Nissan Datsun

Sakshi Malik Wrestling Lia Agarbathi Badminton Edelweiss, Huawei Honor, Savlon Sania Mirza Lawn Tennis FabB, Vencobb Chicken Boxing Country Club Hospitality and Holidays Geeta Phogat & Babita Wrestling Swachh Bharat Abhiyan Phogat Archery State of Jharkhand Campaign

Duff & Phelps 18 RECENT TRENDS Celebrity backed merchandising brands

Merchandising involves packaging / Celebrity presentation of products to According to industry sources, Hrithik consumers in effective ways to Roshan’s brand HRX, which was merchandising is enhance sales. When one adds a launched in 2013, is expected to a new trend in the celebrity element to merchandising, record gross revenue of about INR the overall impact gets magnifies. 2,000 million ($30 million) in FY17, Indian market Celebrity merchandising is a new an increase of almost 100 percent trend in the Indian market where over FY16. The brand is targeting where celebrities celebrities collaborate with about INR 5,000 million ($75 million) collaborate with companies or designers or of revenue in FY191. In addition to an independently launch their exclusive increase in top line figures, HRX has companies or line of products. While celebrity been honored with awards such as designers or merchandising is already common in “Brands with outstanding eRetail western world with celebrities such performance: Sports brand” in the independently as Beyoncé (House of Dereon), Jay- sixth edition of the Indian Retail & Z (Rocawear), Hillary Duff (Stuff), eRetail Awards and “Best Celebrity launch their Michael Jordan (Air Jordan) and License Brand” at the India Licensing exclusive line of Kanye West (DW Kanye West), the Expo, 2017. Indian market is expected to products showcase robust growth in the Wrogn, the brand co-owned by Virat coming years. Kohli and Universal Sportsbiz Private Limited (USPL) was launched as the Being Human, owned by the Salman fashion brand for youth in 2014. The Khan Foundation, is arguably the brand has collaborated with Myntra leader in the celebrity merchandising and Shopper’s Stop. In 2016, Wrogn segment. This clothing and launched its own exclusive brand accessories brand was launched in outlets across the country. It is of 2012 by Mandhana Industries Limited crucial importance that the brand through a licensing partnership with communicates values similar to those the foundation, and in 2016 the of the celebrity. For instance, Wrogn business was transferred to The is the brand owned by Virat Kohli. Mandhana Retail Ventures Limited. The name of the brand is different The Being Human brand had sales of and the designs are quirky and INR 2,160 million1 ($33 million) for stylish, which goes well with Virat the year ended March 31, 2017 and Kohli’s off and on field personality. is available across 600+ retail and various e-commerce selling points. The brand has grown at a CAGR of ~19 percent over the past three years.

(1) Myntra buys 51% in Hrithik Roshan’s lifestyle brand HRX, by . Figures are converted from INR to USD using an exchange rate of 64.85 (March 31, 2017) Duff & Phelps 19 RECENT TRENDS Celebrity backed merchandising brands

Firms such as In addition to Wrogn, USPL also market and are guiding celebrities and launched Imara with Shraddha Kapoor sports personalities to come up with USPL and in 2015; in September 2016, the innovative merchandise campaigns. company launched Ms. Taken with Abhishek Verma, CEO Mojostar, says Mojostar are actor as its ambassador1. that though lots of merchandising building a With the help of these three celebrity brands are coming up in this space, the labels, USPL recorded a revenue of industry is still in a nascent stage. He portfolio of co- INR 1,056 million ($16 million) in FY17, highlighted that the fan following of a owned celebrity up 72 percent over FY16 2. Further, in celebrity can bring in the initial set of November 2017, the company raised customers but it’s the quality of a merchandise INR 1,000 million ($16 million) from product that retains the customer. Accel Partners, resulting in enterprise brands, value of around INR 6,450 million Further, endorsing a product brand and revolutionizing ($100 million)3. owning a product brand are two different areas as the latter demands the retail market Mojostar is a venture of celebrity more involvement of the celebrity, from management firm Kwan Entertainment designing to marketing. The and marketing firm Dream Theatre, authenticity of a product brand depends which promotes celebrity brand on its positioning in the market. It is of merchandising. The firm recently crucial importance that the product finalized deals with Jacequiline brand communicates values similar to Fernandez and Tiger Shroff. They are those of the celebrity. aiming to revolutionize the Indian retail

Annual Sales (FY17) of platform Platform Label Celebrity Name Launched in (INR million) Myntra Designs Private Limited Alia Alia Batt 2014 12,310 4 (portfolio of 13 private labels) All About You Deepika Padukone 2015 ($190 million) 2,160 The Mandhana Retail Ventures Limited 2012 Being Human Salman Khan ($33 million) Wrogn Virat Kohli 2014 1,056 Imara 2015 Universal Sportsbiz Private Limited Shraddha Kapoor ($16 million) Ms. Taken Kriti Sanon 2016 XS Brands Consultancy Private 2,000 HRX Hrithik Roshan 2013 5 Limited ($30 million) (1) Universal Sportsbiz: It’s all in the game, by Forbes (2) USPL Annual Report 2017 (3) USPL raises Rs 100 Cr, crosses $100 million valuation, by LiveMint (USD/INR Exchange rate: 64.45, November, 2017) (4) The total revenue of Myntra for FY17 was INR 58,620 million, out of which 13 private label brands account for 21 percent share. Source: Various articles published in LiveMint and Business Line during March, 2017 to September, 2017 (5) Myntra buys 51% in Hrithik Roshan’s lifestyle brand HRX, by The Economic Times Duff & Phelps 20 METHODOLOGY Our Approach and Methodology

The applicable Determine Average brand multiple brand Average endorsement represents the Celebrity Applicable ranking on Annual fee multiplied capitalization Brand Brand the basis of Endorsement by the number rate adjusted Ranking Multiple various Revenue of endorsement for recent parameters deals success and popularity

In assessing celebrity brand value, we of our analysis, we have not taken into It is important to faced several challenges that one would consideration the amount a celebrity note that as part not normally encounter when valuing a earns from films and production houses corporate brand using conventional and that he or she runs. We contend that of our analysis, generally accepted valuation while these aspects do impact their we have not methodologies. Most importantly, a earning capacity, they have no bearing celebrity brand is not an indefinite-lived on the celebrity’s income from taken into asset. endorsements alone. Our assessment represents the brand value of a celebrity consideration the In addition, a celebrity brand cannot be based purely on his or her earnings amount a monetized through a licensing potential from product brand arrangement. While it may be argued that endorsements. celebrity earns a celebrity can earn a royalty from from films or products which he or she has associated In order to adequately capture the definite his or her name and likeness (case in life of a celebrity brand, we considered production point being Michael Jordan and the “Air several conventional methodologies. Jordan” line of Nike products), such However, we did not think it is houses that he or arrangements are limited to a few appropriate to simulate increases / she runs participating celebrities. decreases in forward earnings in our methodology since the popularity of a In India, similar arrangements are gaining particular celebrity is limited to the popularity as explained in the section on present and the recent past. Bad brand Celebrity backed merchandising brands. management (e.g., a year of flops or bad However, we have not considered performances) by the celebrity can merchandising earnings in the current quickly result in a lower demand for his or analysis, as the earnings from a product her services as a brand endorser. brand endorsement would still represent the largest contributor to a celebrity’s brand.

Further, it is important to note that as part

Duff & Phelps 21 METHODOLOGY Our Approach and Methodology

Our assessment Our assessment is based on the current films and his larger-than-life personality rankings of celebrities, average off camera. Though Facebook and is based on the endorsement fee, current number of Twitter are two main social media annual endorsements, applicable brand channels, over the last few years, current rankings multiple and a popularity index Instagram has gained huge popularity in of celebrities, adjustment. India, and young stars like Alia Bhatt and Varun Dhawan, who have a negligible average Celebrity Brand Ranking presence on Facebook, command a huge endorsement fee fan following on Instagram with more There are several sources and agencies than 19 million and 11 million followers rates, current that rank celebrities on the basis of respectively. proprietary tools and methodologies. For number of annual our assessment, we have used a Our celebrity social media rankings are endorsements, combination of rankings available in the based on the number of Twitter, public domain. However, over the course Facebook and Instagram followers. Of applicable brand of our discussions with experts from the the celebrities we assessed, the table multiple and a celebrity endorsement industry, we found below represents their social media that several of these rankings ignore a presence as of November 2017. popularity index celebrity’s social media involvement. Social media may not be the most Our concluded celebrity brand rankings adjustment important aspect when selecting a are based on a weighted average of the particular celebrity, but it definitely plays social media presence and various a huge role in building credibility and rankings from sources in the public developing a fully engaged fan base. domain for each of the celebrities in our study. The celebrity brand rank so Some celebrities have achieved computed has been accounted for in the reasonable success with carefully popularity index adjustment. planned social media programs. Amitabh Bachchan, one of the most popular Indians around the globe, has massive popularity on both Twitter and Facebook owing to the magnificent versatility in his

Social Media Presence (Figures in millions) (November 2017) Twitter Facebook Instagram Rank Celebrity Total Followers Followers Followers Followers 1 Salman Khan 27.6 35.6 12.9 76.2 2 Deepika Padukone 21.5 34.1 20.3 75.9 3 Virat Kohli 20.0 36.0 16.7 72.7 4 Priyanka Chopra 20.3 28.7 20.1 69.1 5 Amitabh Bachchan 30.9 27.6 6.0 64.5 6 Akshay Kumar 22.0 24.0 15.1 61.1

Duff & Phelps 22 METHODOLOGY Our Approach and Methodology

Average Annual Endorsement stars like are still actively Celebrity brand Revenue endorsing products despite not value has been breaking into the list of top celebrity Average Annual Endorsement Revenue endorsers. computed as the is computed as the product of average average annual endorsement fee and the number of On the other hand, aging male endorsement deals for each of the celebrities in India continue to remain endorsement celebrities. in high demand for endorsements, mainly driven by a late peak age and revenue earned In estimating the average endorsement continued film successes. Movie by a celebrity fee for each of the celebrities, we have stars like Amitabh Bachchan, age 75, consulted industry experts from talent continue to remain among the most multiplied by the management agencies, advertising sought-after celebrities for adjusted celebrity agencies, and consultants, as well as endorsement. secondary sources such as news and brand multiple media articles. 2. Recent success: This is analyzed by reviewing the number of hits (good The number of endorsement deals for performances) versus flops (bad each of the celebrities are primarily performances) a celebrity has had based on actual advertisements on over the last 10 films or important television and print media. We have also performances. considered various secondary sources. 3. Popularity index: This is computed Adjusted Celebrity Brand Multiple by looking at celebrity brand rankings and average secondages per product The adjusted brand multiple represents brand per month1. the rate of capitalization for celebrity brands, adjusted for the following Celebrity Brand Value parameters: Finally, celebrity brand value has been 1. Age: We have made adjustments for computed as the adjusted average the age of the celebrity in conjunction annual endorsement revenue earned by with the current and typical peak age. a celebrity (after deducting relevant costs Unfortunately, the Indian population including taxes) multiplied by the adjusted is rather cruel to female celebrities in celebrity brand multiple so derived. that there are no female celebrities over the age of 40 that have made the rankings. It should be noted that

(1) Secondages means the number of seconds the celebrity appears on TV for a particular brand

Duff & Phelps 23 CONCLUSION Celebrity Brand Values

NEW ENTRANTS TOP GAINERS

#10 #15 #1 #4 #9 Varun P. V. Virat Akshay Alia Dhawan Sindhu Kohli Kumar Bhatt US$32 Mn US$15 Mn 2016 - #2 2016 - #13 2016 - #14

The total brand Virat Kohli has emerged as the new In our 2016 report, we had forecasted king of the Indian advertising industry, that celebrity product brand value of the top with his unstoppable attitude coupled endorsements may experience a strong 15 celebrities in with extraordinary performance in tailwind due to the growing trend of cricket. He has dethroned King Khan to celebrity brand extensions and co- India is $712 become the most valuable celebrity ownerships. This has become a reality brand of India with brand value of $144 with the emergence of celebrity backed million. million, up ~56 percent in 2017. This merchandising brands and companies increase is primarily driven by his such as Mojostar creating and investing “While Bollywood celebrities growing endorsement fees, on-field in a portfolio of celebrity backed labels. continue to rule the top 15, performances and rise in popularity sportspersons are providing With the increasing dominance of index. Shah Rukh Khan slipped to tough competition as Kohli, millennials in celebrity endorsements, a second rank, with a brand value of $106 Dhoni and Sindhu, new generation of personalities and million, down by ~20 percent as collectively valued at $180 female sportspersons may emerge as compared to 2016. million, account for almost a strong winners in the coming years. quarter of the total celebrity Deepika Padukone, valued at $93 brand value” Key Conclusions million, retained her third rank. Akshay Kumar performed phenomenally, adding • Millennial endorsers are replacing seven new product brands to his older faces, and constitute 63 portfolio. This resulted in an increase of percent of the total brand value of ~97 percent in his brand value to reach the top 15 celebrities. $47 million in 2017, leapfrogging him to the fourth rank from thirteenth rank in • New entrants to the top 15 celebrities 2016. included Varun Dhawan debuting at tenth rank, and P.V. Sindhu debuting Other celebrities such as Alia Bhatt, at fifteenth rank. Amitabh Bachchan and Varun Dhawan also made great strides in the • Sports celebrities contributed around Aviral Jain endorsement space by adding a 25 percent of the total celebrity brand Director number of new product brands to their value in 2017. Duff & Phelps India portfolio in 2017. Noticeably, P.V. Sindhu marked her entry into the Top 15 ranks with brand value of $15 million.

Duff & Phelps 24 Limitations of the study

The analysis and estimates presented in this report are based on extensive research on secondary sources of information and limited primarily to discussions with industry participants. We have not undertaken any independent verification or carried out any due diligence on the data used or considered, nor have we verified its factual accuracy in the current context. Brand values may differ based on actual information available with agencies engaging with celebrities directly. The conclusions provided in this report shall not be construed as marketing advice and the valuations provided in the report shall not be used for any other purpose other than general research and media consumption. Duff & Phelps and its affiliates expressly disclaim all liability for any loss or damage of whatever kind which may arise from any person acting on any information and opinions or analyses relating to the valuations contained in this report.

The valuation of intangible assets is not a precise science and the conclusions arrived at in many cases will of necessity be subjective and dependent on the exercise of individual judgment. There is therefore no indisputable single value and we normally express our opinion on the value as falling within a likely range. However, for the said purpose, we have provided a single value. Under normal circumstances, our assumptions and methodologies are supplemented by discussions with the management and insights provided by them on the most likely course of business over the near term. Our current assumptions for the valuation are based on information derived and analysed from a combination of primary interviews and secondary sources. Accordingly, our assessment and estimates are based on market perceptions and most likely trends of popularity of individual celebrities. Others may place a different value on the various brands.

All trademarks, trade names, or logos referenced herein are the property of the respective companies and owners.

Editorial Team

Editor: Ramanreet Singh Team: Namita Sen, Sarvang Sawalka and Aakriti Gupta Marketing: Brian Shiu

Industry inputs: FTC Talent, Media & Entertainment Private Limited Kwan Entertainment & Marketing Solutions Private Limited

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