The kind of craze the people all over the world have for celebrities has multiplied over the years. Movie stars, sports biggies, and the otherwise celebrated people from the sixties through eighties did not get the adulation as stars get today mostly because of limited exposure and disconnected world.
Running a business is no joke; even if you have all the money globally, it is not for everybody. Celebrities usually start or invest in a business thinking that their brand name will be enough to differentiate their products/services from the competition. Let us look at some of the reasons why these celebrity businesses failed in the past.
6. Complete Customer Disconnect
If you have seen WWE (erstwhile known as WWF) as a kid from the eighties or even nineties, this picture needs no introduction. Hulk Hogan is a big name in the wrestling business even today though the man has retired. His inimitable style in and outside the ring is admired by millions of “Hulkamania” fans worldwide. Unfortunately, the star did not have the business connect with customers, as he did with his wrestling fans.
In the year 1995, at the peak of his career, Hulk Hogan entered the restaurant business. He launched his pasta eatery called “Pastamania,” located in the Mall of America in Minnesota. To give a huge marketing impetus, his match was organized in the Mall of America, the same day he opened his doors for business! With all that finance, brand value, and marketing strategy, the business closed down in less than one year!
The key reasons for Pastamania’s disastrous performance are plenty. For example, the weird names of the dishes like “Hulk Us,” “Hulk-A-Roos,” the odd-looking pasta shapes that depicted the different body parts of the wrestler himself! As per the patrons who tried the food, they felt it was “Okay” to “nothing special” Food quality, poor management also led to the quick downfall of the potential business.
If you ever spoke about movies, you must have said these two words somewhere in the conversation, “Steven Spielberg.” Even though he is a film director and a producer, his fame and recognition can put some movie stars to shame. The man is an utter genius in film-making with hits like Jurassic Park, Indiana Jones, and Saving Private Ryan under his belt.
Spielberg wanted to capitalize on his brand image of a sci-fi genius in the restaurant business. This led to the birth of the themed restaurant chain called Dive. Steven spent millions of dollars to get the building ready and to look like one with a real submarine. Initially, the outlet did well due to the star backing lineup, for example, Arnold Schwarzenegger, Janet Jackson, among others. No one predicted that such adulation would be short-lived.
Just five years into the business, people started getting bored with the themed concept, which focused a lot on gimmickry rather than the food. The consumer taste changed quickly. The restaurants weren’t able to adapt, leading to the brand’s early demise, which forced the director to completely sell off the business to other players who could run the show better.
4. Poor Management
Eva Longoria is best known for her role in the super hit series called “Desperate Housewives.” This show gave her worldwide recognition and fame. She has also worked in shows like “Young and Restless,” which helped her in her acting career. She is also considered one of the most beautiful women in the world by the likes of People’s magazine. No wonder she holds modeling contracts with top brands in the United States even today.
Eva is not the first lady who failed at a business and certainly not the last one. After her first failure at the restaurant business called ‘Beso”, she tried a new idea called “SHe.” A steakhouse for everyone but with a focus on women. At the time, it was considered something modern and new, given the fact that Eva spent millions to get the interior right. She even arranged for female performers with cryogenic curtains and looks.
Eva did not realize that while all her attention was on the looks of the restaurant, she missed heavily on management. The health department fined the restaurant many times due to violations. Besides, the food did not appeal to the women she was trying to target as per the brand name. Complete mismanagement, lack of business acumen, and no control on operations led to another business failure from Eva Longoria’s stables.
3. Ahead of its Time
Natalie Portman is a powerhouse actress in Hollywood. Her work in movies like Black Swan, Thor, Star Wars, among others, has been appreciated by one and all. A complete beauty with brains, Portman is a Harvard graduate who entered the entertainment business at the tender age of 12. She even won the Golden Globe and the Oscar for the Black Swan, which only propelled her already successful movie career.
Just like other celebrities, Portman had a dream to start her own business. By 2009, Portman turned vegan after she read the book “eating animals.” She used her creative genius to start vegan shoes, which was still an unheard concept in the industry. Her partnership with a designer called Te Cesan kicked off well, but she couldn’t sustain the business, which eventually had to be shut down.
Not only were vegan shoes unheard of as a product, but they were also costly compared to their counterparts in the industry. While other brands were selling at $50-$80, Portman priced her shoes at a staggering $180, which did not go well with the customers. Another challenge was sourcing the material since vegan shoes mean no use of animals, which was the only thing available at the time.
2. Over-promised, Underperformed
To many, Lindsay Lohan has been known to people for all the wrong things than her work. She is a television personality who has proved her mettle in the various soap sagas over the years. With immense experience and appreciation on TV, the actress eventually got signed for Disney movies that would be aired on TV only. Lohan also tasted success as a music artist and later ventured into fashion and business.
In Athens, Lindsay had opened her first nightclub in 2016, in collaboration with a business partner, called it Lohan Nightclub. Her affair with clubs in Greece only grew when she decided to open doors to a new club on the island of Mykonos, called Lohan Beach House Mykonos. She partnered with MTV to run a reality show about her life as a businesswoman and to show the viewers behind the scenes of her life.
What went wrong with the venture is that people expected Linsday to be on air on the show most of the time, which was not the case. Even though the show promised the star’s real life, she was not seen; rather, her staff dealt with situations while running the beach house. This led to poor ratings on MTV, and the show did not return for a second season, which also led to the closure of the Lohan Beach House, just a year into operations.
1. Rip-off Product
Kim Kardashian is an American socialite who has been famous for being famous. Her story from rags to riches is inspiring for many. Kim is an astute businesswoman who has now built an empire by involving the entire Kardashian family into the limelight with her famous show “Keep up with the Kardashians.” The sisters keep deploying money to new ventures trying their hand at every strategy possible to rake in the millions.
Even though Kim ran multi-million-dollar businesses in the past, Kim’s “Kardashian Kard” was a complete dud. Aimed to appease the parents of younger, vulnerable teens of America, the card offered money management and monitoring to keep an eye on their kids’ financial choices. While it all sounded good, the worst thing was the card was plastered with pictures of the sisters, and it was a total rip-off.
The card’s first-year charges would be $99.95, including a one-time purchase fee of $9.95. Thereafter, a monthly fee of $7.95 and a pre-loaded deposit amount of $5. ATM withdrawals were pegged at $1.50 per transaction, and auto bill pay would cost $2 per item. This prepaid card was a money looter, which led to the downfall of the “Kardashian Kard.”
The celebrities of the 21st century are smarter compared to the previous generations. They know that they have a limited window of fame and the opportunity to cash in as much as possible. Before their careers in films, sports, business comes to an end; they try to create new sources of income to get the ball rolling even when they hang up their boots for good.
With the financial backing, start power, and access to the best in the industry, it is much easier for celebrities to start a business. As it is said, starting a business is easy; maintaining it and growing it is another ball game altogether. This requires more than money, power, and status; it calls for utter business acumen and strategy to execute.