The Value Co-creation Mechanism of Celebrity Endorsement: Netnography of Multiple Fan Communities

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Unlike the passive consumers depicted by the traditional theories of celebrity endorsement, nowadays it is the fan community that plays a crucial role especially in the process of new celebrity brand endorsement: Incented by the affection to their idol, fans voluntarily gather together to form blurry boundary organizations to collectively promote the market performance of the brands their idol endorses, which in turn impacts the operation and decision-making of the brands. Such active participation of the fan community produces a new mechanism of celebrity endorsement, of which the current literature has not yet responded with convincing explanations. Based on an 18-month online ethnography study of multiple fan communities, this paper discovers that the new celebrity endorsement is no longer a linear value delivery process; instead, it is a dynamic circle of value co-creation consists of a rising star, his/her fan community, and the endorsed brands. In social media, a fan community is driven by both the platform rules and the strong affection to its idol to transform from a tribe bounded purely by affection into an organization of production; the core organization goal consequently changes from affective interaction into expanded reproduction of the celebrity capital, in the process of which celebrity endorsement becomes one of the means to achieve the organization goal. Generally speaking, fans of a rising star with relatively low celebrity capital would expect high value brands to pick up their idol as endorser so that the idol could benefit from the brands. Yet to the brands such cooperation may benefit more to the rising star rather than vise versa. In order to attract brands to the seemingly unappealing deal, the fan community will proactively offer its free labor brand communication as well as consumption to compensate the potential brand equity outflow – they not only act as heavy consumers of their idol-endorsing brands, but also actively help these brands to grab more market share. As a result, brands are paid off by better communication effects and market performances which lead to increasing brand equity; meanwhile, the rising star’s celebrity capital is nurtured and enhanced. In this triangular loop, the fan community not only supports and accelerates the value exchange between celebrity and brand, but also proactively constructs the brand equity as well as the celebrity capital. In this way, the fan community actually generates new capital investment opportunity by attracting other higher value brands to consider their idol as endorser, hence pushes the celebrity capital to the next higher level of value co-creation circle. As such, the idol’s celebrity capital spirals up through multiple brand endorsement co-creation circles, and the subsequent endorsed brands acquire higher equity in return. Meanwhile, as the bound between the fan community and its idol being continuously reinforced, fans are rewarded by emotional satisfaction and strong confidence grown out of their collective achievement. This study innovatively complements the existing endorsement theories by emphasizing on the influence of fans’ voluntary labor; it also enriches the theories of fandom studies and provides important suggestions for brands to make strategic decisions on celebrity endorsement in the social media environment.