Advertising: It seemed like such a good idea at the time

Picking a celebrity to front your campaign is always tempting. But there's a serious risk that it will backfire

Celebrities are a crucial part of the workforce. God knows where we'd be without them. Whole rafts of 21st-century industry and commerce depend on them - think Nike, think Walkers crisps. We're trying our best to train up more celebrities to meet the demand for digital channel presenterines and West End premiere-goers but the hard fact is that, as with civil engineers or physicists, we're just not creating enough.

Celebrities are a crucial part of the workforce. God knows where we'd be without them. Whole rafts of 21st-century industry and commerce depend on them - think Nike, think Walkers crisps. We're trying our best to train up more celebrities to meet the demand for digital channel presenterines and West End premiere-goers but the hard fact is that, as with civil engineers or physicists, we're just not creating enough.

Celebrity production is up about 150 per cent from the mid-1980s, but demand's up 500 per cent. And, like any new sector, the whole head-hunting side of celebrity things is distinctly amateurish. Just think of all the candidates a decent Westminster-based headhunter sees on a regular CEO search, just think of all that psychological profiling by stern Swedes called Lars, just think of the discreet peer group enquiries about "character" and recreational habits.

Compare that with the decision process in advertising . "I'm having a very Charlie-from-Busted moment" says 29-year-old shaven-headed creative director Jake from Shoreditch and, bang, that's the Age Concern campaign sorted.

Advertising is at the core of the celebrity business axis. Hamish Pringle, director general of the IPA, the advertising industry's trade association, describes exactly what happens in his new book, Celebrity Sells. Let's say research shows you've got a low-interest complex product in a low-interest sector. How do you achieve "cut-through" for your brand? You hire a celebrity, of course. And you hang a big-budget branding campaign on him or her. The next round of research shows ad awareness going through the roof. But when you want to start putting your dull detailed message across in phase two, you find the world's only interested in the celebrity, who's become what Pringle calls "a vampire".

Because celebrities are such strong advertising steroids, there's an awful lot to go wrong. Take Bobby Robson, for instance. Robson, the cornerstone of Barclays' vastly expensive new football sponsorship campaign, has just been sacked as manager of Newcastle United. What does Barclays do with its spectacular new commercial, which shows a whole football crowd computer tricked up with Bobby Robson heads?

Celebrities can be wrong for the role: Pringle cites Joan Collins as an unlikely customer for the Bristol and West building society - and they can go wrong in the role. Pepsi dropped Michael Jackson when the child molester charges surfaced. O J Simpson lost his contract with Hertz in 1994 when he was accused of murder - and he didn't get it back when he was acquitted.

Obviously celebrity spokesmen shouldn't break big laws. But it's a harder call when they break a little one - speeding or secondary drugs - or when they act out of character. Take David Beckham. We used to think of him as a kind of Forrest Gump - beautiful, brilliant at his job but wonderfully dumb and loyal. The Rebecca Loos affair implied he wasn't like that at all. But did it matter for Police sunglasses or his new Gillette contract? Arguably it made him sexier and more interesting. But for M&S, the family store, and their boyswear, it's different. Whatever the thinking, Beckham's out of there.

Celebrities aren't fantastically loyal types. If you don't tie them down legally you find they're working all over the place, to max their income while they're hot. Linda Barker has been in heavy rotation for the last couple of years for DFS and Currys and the public gets confused. And there was a time when Joanna Lumley seemed to be in everything (she's currently in the Privilege Insurance commercials - "If you're really posh ...").

Or they can say and do rather disloyal things. Paul Kaye - "Dennis Pennis" - said he bitterly regretted appearing in a Woolworths Christmas campaign - and he said it in a thoroughly modern dirty-words way. Lots of forgetful darlings made it clear rather publicly that they didn't use the products they'd endorsed: Britney drank Coke while Pepsi was paying her millions, Jamie Oliver admitted his restaurant wasn't supplied by Sainsbury's, Tiger Woods turned from his Nike equipment back to his original brand when his performance dipped.

Advertisers and agencies persist because they think celebrity endorsement's a risk worth taking. In a crowded media marketplace, with the lead times on product innovation getting shorter and shorter, an increasing percentage of a company's value in highly advertised sectors lies in the brand. Look at the notional value of the Coca-Cola brand, number one in the Interbrand/Business Age global top 100 brand list. By its calculations, the Coke brand's net present value is $67bn. Set that against market cap and you see that the brand accounts for most of the company's value.

Celebrities, used cleverly and consistently , can really contribute to brand value. Sainsbury's has seen it from both sides. Their 1999 campaign which had John Cleese shouting at shop staff topped a chart of worst-ever celebrity endorsements. Customers hated it and staff complained. Conversely, Jamie Oliver's done wonders for them in tough times. Young, likeable, demotic and capable of making vegetable-chopping look like fun for lads, he's probably shored up the share price.

'Celebrity Sells' by Hamish Pringle (John Wiley, £16.99)

Peter York on Ads returns next week