Snoop Dogg was revealed as the new celebrity face and shareholder of Klarna in a new advertising campaign for the POS financing house – another big name to add to the growing list of fintech influencers including the likes of Will.I.Am, Shaquille O’Neal and Akon.
In addition to appearing in the recent ‘Get Smoooth’ video, Snoop Dogg’s portfolio also includes marijuana business natch, Reddit and trading app Robinhood and will now work with Klarna to expand his business prospects in Europe.
With social media being a significant part of society and culture today, it questions whether celebrity endorsements could work in the same way for fintech companies as they do for the beauty, fashion and music industries.
The concept of brand is seemingly becoming more and more important in the financial technology sector as the space is becoming increasingly crowded and all challenger banks seem to be offering the same services with a lack of USP.
What we are also seeing is a sense of what I will refer to here as “jumping on the advertising bandwagon” and the industry has seen newcomers like Viola mention well-known and established brand Monzo in their adverts to draw attention and press coverage – and it has worked!
However, as brands target advocates who have a big social media following rather than industry experts, what this does not do is establish is a longstanding customer relationship. Once something has finished trending, the consumer moves on to the next brand endorsement, sometimes within seconds.
The Financial Times reported that getting celebrities to recommend a new mascara or shampoo is very different to endorsing credit cards or personal loans and this has resulted in negative interest from regulators.
At the end of 2017, the Securities and Exchange Commission published a warning that stated investments should not be made “just because someone famous says a product or service is a good investment”. This warning was published soon after a number of celebrities started to publicise initial coin offerings on their social media accounts.
Prior to this warning, it was announced that Will.i.am would be advising U.K. app-only bank Atom and would provide that fintech firm with insights on culture, charity and technology. While many questioned this decision at the time, the singer had worked with Intel and had launched his own hardware startup called i.am+, so his recruitment into the fintech world was not as outlandish as many thought it was.
Similar to Shaq’s attempt to remedy the work-life balance in America with his backing of Steady, Akon also launched his own cryptocurrency Akoin in order to give people in Africa back control over their money and to stop the government from preventing them from advancing themselves.
While Akon may not have the wealth of experience in financial services, his philanthropic efforts must be commended. But how can we measure the success of celebrity endorsements? Surely if a celebrity wants to create a product that helps others, especially those who are financially excluded, it is a good thing?
In addition to this, instead of celebrity endorsements, would it not make sense for customers to provide future customers with the success stories? According to the 2018 Sprout Social Index, 61 percent said that they would research a product if their friend recommended it in comparison to 36 percent who would if the product was endorsed by a professional influencer.
This also raises the somewhat quiet debate of whether a “fintech influencer” exists is and if “influencer lists” that are based on the number of social media followers a so-called industry-expert has actually mean anything – but that’s for another article.