The cult of the celebrity is now a crucial part of the success or failure of any business as the latest spate of celebrity shenanigans show
Unless you happen to keep your head cool at night beneath a couple of feet of sand, here are three events you can hardly fail to have noticed in recent days.
David Beckham, England's soccer captain, has changed clubs from Manchester United to Real Madrid.
The new Harry Potter book has hit the shelves. And there is a new Lara Croft video game out.
What do these three have in common? They are all big news events, to which days of TV time and acres of newsprint have already been devoted. But they are also big business events, driving the share prices of the companies involved.
Manchester United Plc's shares surged after the club agreed to sell Beckham for as much as e35m ($40.9m).
Harry Potter's publishers, Bloomsbury Publishing in the UK and Scholastic in the US, are sitting back and waiting for their big payday. There is no doubt Harry Potter and the Order of the Phoenix will top the best-seller charts around the world. Amazon.com has already received more than one million advance orders for JK Rowling's book.
Meanwhile, Eidos shares have been jumping around in anticipation of Lara's first outing on Sony's PlayStation 2 console. Her first five games have sold more than 28 million copies, and she has already appeared in one feature film. The new film, 'The Cradle of Life,'' will be released next month.
Beckham, Harry Potter and Lara Croft may not appear to have much in common, apart from the fact that all three are English, and all three have magical powers: Beckham in his boot, Potter in his trainee wizard's wand, and Croft in attributes that we won't go into in this column.
But the most magical power of all, at least for the companies that surround them, is their ability to shift product. Signing Beckham will help Real Madrid conquer the Far Eastern market, and sell replica shirts by the ton.
Harry Potter will deliver massive profits for his publishers: Bloomsbury said it expects profit to reach at least £15m ($25m) this year with the help of Harry Potter's success, and retailers will make just as much.
Lara Croft has been helping to revive the fortunes of Eidos, which returned to profit in its fiscal first half. Although it has had some other big hits, Eidos remains very much Lara's company. 'With the imminent launch of Tomb Raider: Angel of Darkness, Eidos has, in our view, the strength to be one of the top performers,'' ING Baring says in a new analysis of the industry.
Most importantly, all three are famous beyond belief. There have always been famous people and popular cultural figures. But they have never been so central to the global economy as they are in this decade.
Of all commercial currencies, fame is the most valuable right now.
What are the implications of that for companies and investors? It is that stars are more important than they have ever been and that only companies who know how to create and handle them will succeed.
It is common to talk about globalisation and new technology as if it were a threat to companies. Relentless competition, global overcapacity, and tumbling trade barriers mean it's harder than ever for companies to make consistent profits. Profitless prosperity, to steal a piece of jargon from the management consultancy trade, rules. The economy grows, everyone produces more and more, but they find it harder to make any money.
But there is always a flip side to every story. One person's threat is another's opportunity. So just as there are losers from globalisation, there are also winners.
Beckham, Harry Potter and Lara Croft fall into the winners' camp. They are perfect examples of how to make money in a global, information-based economy.
Technology has allowed icons to switch effortlessly from format to format, multiplying the revenue they can earn, and multiplying their fame as well. Beckham starts as a football player, but quickly becomes a T-shirt or a mobile phone. Harry Potter starts out as a book, but then becomes a film and a McDonald's Happy Meal. Lara Croft starts as a video game, then becomes a film, and so on.
Globalisation has allowed icons to switch effortlessly from territory to territory.
Bloomberg newsroom, Frankfurt
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