Just because they’ve made hundreds of thousands of dollars, doesn’t always mean celebrities are smart with how they spend their money. Outside of acting, singing, or whatever it is that makes someone ~famous~ many celebrities have tried to amplify their success by introducing a new business to the market.
And while there is no real research behind the percentage of celebrity businesses that fail, we’ll just say A LOT.
Market research can be conducted in many phases when launching or have already launched a product, service, or brand. It can help measure who your target market is and their likelihood to purchase, their opinions on competing products, how much they would pay for the product or service, and other key insights.
You likely do not have the bank account or budget of a celebrity, therefore you cannot afford to waste money on a business without conducting proper market research. Luckily, with new product development research many detrimental mistakes are caught before they happen. Unfortunately the same cannot be said for these three celebrities.
Market research can catch detrimental mistakes before they happen to your business. Unfortunately, the same cannot be said of these failed celebrity endeavors.
1. Kim Kardashian West – Kimono
While the Kardashian-Jenner family may not always get a good rep, you have to respect their ability to make money off of literally anything. From fashion, cosmetics, to fragrance it’s as if everything they touch turns to gold. Look at Kylie Jenner for example. At just 21, the youngest of the Kardashian-Jenner clan is also the youngest self-made billionaire ever after the huge success of her cosmetics line.
Unfortunately, older sister, Kim did not receive this same praise and reward when she introduced her new shapeware line to the market. In late June of 2019, Kardashian announced the line under the name Kimono.
Shortly after the reality star was accused of cultural appropriation, even receiving a letter from the mayor of Kyoto, Japan pleading her to change the name. A few months later, Kim Kardashian would change the name of her shapeware line to SKIMS. A rebrand that almost cost her $10 million.
When introducing any new product, regardless if you are an existing successful brand or a new business, it is imperative to conduct market research for new product development. In doing so, organizations can measure a multitude of factors such as general needs of the market, competitor analysis, and this case opinions toward the product’s name.
Conducting a simple focus group or online survey would have saved Kim Kardashian a lot of money and severe backlash.
2. Hulk Hogan – Pastamania
Feasibility studies are an often undervalued market research methodology that could save many new business owners some heartache (and cash). A feasibility study helps analyze the likely success or failure of a new product, service, concept, or location.
This market research methodology may be the saving grace for all types of launched businesses as feasibility studies are often conducted for new product development, new service launches, new business concepts, and new business locations or an expansion to a new market.
You should have contacted our feasibility studies company, Mr. Hogan! To be fair, the amount of celebrity failed restaurants is alarming. No, really. While any of these celebrities could have made our list for this exact reason, we chose to explore the failed restaurant that was Pastamania.
In 1995, Hulk Hogan traded in his wrestling gear for a chefs hat, when he opened Hulk Hogan’s Pastamania in Mall of America. His attempt at Italian cuisine(ish) didn’t even last a year. The failed restaurant is attested to little interest of those who lived near the Mall.
Only die-hard fans of Hulk Hogan were willing to travel to Minnesota to try a dish of Hulkaroni and Cheese or Hulkios. You can’t make this stuff up, people.
3. Natalie Portman – Vegan Footwear Line
In January of 2008, actress Natalie Portman launched her vegan footwear line with Te Casan label. Her shoe collection was backed by her vegan, animal friendly, eco-conscious lifestyle – however, was not backed by the public. Critics of the vegan shoe brand believed the collection was under designed and overpriced.
The price of a pair of heels from Portman’s shoe line averaged at $275, a cost that was much higher than competing vegan shoe brands already in the market. In November of that year, her entire inventory of vegan shoes were put on sale to try and be more cost-friendly to her target demographic. It was too late. The next month, the entire brand folded.
You’re not alone, Natalie. Determining the price of a new product is often a challenge for many brands. To help decide how much your target customer would be willing to pay for your product, our full-service market research company recommends using the van Westendorp pricing model. Often referred to as the Price Sensitivity Meter (PSM), this model helps address the proper value or price of a product by asking target consumers these four survey questions.
Whether it be through a phone survey, email survey, or mail survey, the van Westendorp pricing method is your best chance at determining how much you should charge consumers in order for your new product to be well received by the market.
Contact Drive Research
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