Our society is fascinated by celebrities and we are naturally attracted to the vast amounts of wealth and popularity they possess. Have you ever wondered how much money these celebrities make and how they make it? There are many websites dedicated to celebrity net worth but they never really dive into the various ways that celebrities make their money. In order to get a better understanding of how celebrity net worth is calculated there is a need to first review how these celebrities do business.
What is a Celebrity?
There is open for debate since anyone who is well known or respected for their particular career could be classified as a celebrity. Take Albert Einstein, he was a genius in his own right and a celebrity but he is not part of pop culture or an actor so for the conventional definition of celebrity he would not quality but he is a celebrity nonetheless. We can use the typical Hollywood actor/actress as an example, they earn a significant portion of their net worth from the money they are paid to act. They receive a lump sum payment just to star in the film whether that particular film makes money or not the actor is paid up front. The producers of the movie figure these brand name performers will make the movie better and draw out viewers to the local cinema.
Along with the lump sum payment what some producers will do to get the best possible performers is offer them an exclusive on the movie. This exclusive will provide the performer with a source of residual income, each and every time the movie is played the performer is going to receive compensation for it, the amount varies but since the movie will be shown all over the world and on televisions it can be a huge sum.
While we have touched on the primary source of revenue for a celebrity we still need to begin reviewing some of the other ways they make their money. One of the most prominent ways that these celebrities earn their money is by signing a lucrative endorsement deal. These deals can be huge depending on the celebrity and there are some individuals who earn more from their endorsements than what they do from their “day job”.
Endorsements can range from anything to clothing, products, services, whatever can be promoted can be endorsed by a celebrity. Aside from the endorsements, the celebrity can also earn money by offering their services for speaking engagements or product launches, there are people who will pay good money just to be near the celebrity and companies wanting to launch a new product or service can leverage that desire. There is virtually no limit to the amount of money these celebrities can earn but the challenge is managing it properly, in this department the majority of celebrities fall short and end up in dire economic straits the moment their career slows down.