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Influence - We may not realize it. but many aspects of our lives are implicitly influenced by celebrities. From the things we want because we see ads for them, to the food we believe is healthy. Often, these desires take root in some sort of publication or endorsement.

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Influence - More than the things we do in day-to-day life, the whole economy can be radically changed by celebrities. They wield so much influence that, with one tweet, they have the power to make or break a company. It is a scary price to pay for social media.

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Shares - Shares are small parts of a company that individuals can purchase and sell. First, it is important to understand that the prices of shares in a company are only worth what people think they are worth.

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Shares - Therefore, if something bad happens with the company, people will start to sell shares because they think their value will drop. The same logic applies if something good happens. If there is good news, then more people will buy the shares in anticipation of their value increasing.

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How? - There are a few ways in which celebrities influence the stock market every day. It is much easier for them to do so nowadays because of social media. One of the simplest ways that stars can affect the economy is by buying a huge share of a company.

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Investment - By investing in a company, the company gets publicity from the celebrity endorsement. This means that more people are likely to buy the product. On top of this, it signals to people who follow celebrity financial portfolios that the company is a good bet.

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Co-branding - Companies seem to do a lot better when the celebrity fits the company. For example, it makes more sense for a beauty model to advertise perfume rather than hair loss products.

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Reputation - One of the main factors in choosing what shares to buy is the reputation of a company. Even though having a celebrity support a company actually says very little about how well it functions, their influence nevertheless leads people to think that the company is better and therefore more reliable.

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Oprah Winfrey - This is exactly what happened in 2015. Oprah Winfrey bought 10% of the company Weight Watchers and also agreed to be a brand ambassador. In total, she spent US$43 million on investing in the company.

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Oprah Winfrey - Understandably, the share price of the company skyrocketed. It increased in price 279% from before the megastar made the announcement. Now the company has changed its name to WW International. In 2020, Oprah Winfrey’s charitable foundation started to sell the shares again, which triggered a huge drop in the WW share price.

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Subway - Subway used to be largely represented by spokesman Jared Fogle (left). He was famous for his “Subway Diet.” He apparently lost over 200 pounds (90 kg) while eating the chain’s sandwiches. He did most of the company’s advertising from 2000 to 2015.

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Subway - In 2015, Jared Fogle was convicted as a sex offender. He was charged with paying minors for sex and receiving child pornography. As a result, Subway experienced a substantial dip in its share price.

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Pepsi - Pepsi has been known to get the biggest celebs on the case when it comes to endorsements. They have been successful with stars like Beyoncé, Britney Spears, and Madonna. However, in 2017 they made a mistake by creating an ad inspired by the Black Lives Matter movement featuring Kendall Jenner.

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Pepsi - The ad was a ridiculous misrepresentation of the brutality between protestors and police. The ad went viral, criticisms mounted, and it was taken down. Strangely enough, the share price did not fall much when the ad aired. The crash only happened after Jenner apologized.

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Hillary Clinton - In 2015, Hillary Clinton managed to affect the whole pharmaceutical industry. She sent out a tweet about how pharmaceutical companies were “price gouging.” This means that they are selling products at unfair prices.

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Hillary Clinton - As a result, the value of biotech companies' stocks plummeted. At that time, Clinton could have become president, and so experts predicted that the future for pharmaceutical company profits wouldn’t be bright. Therefore, lots of people sold their shares.

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DJ Khaled - DJ Khaled also decided to represent Weight Watchers. When he signed up in 2018, the stock price went up by 7%. Although he didn’t “break the stock market,” he is a good example of just how much celebrities influence consumer choice.

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Bitcoin - Bitcoin is an extremely volatile stock. This showed when Elon Musk tweeted that Tesla would not accept Bitcoin payments because he was concerned about the adverse environmental effects of mining the currency.

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Bitcoin - The price of Bitcoin fell around 15%, as did the stock price of Tesla. It is admirable that, even though Tesla has lots of Bitcoin, Musk put his concern for the environment above monetary gains.

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Chipotle - In 2017, the American chain was doing pretty well. This changed when actor and singer Jeremy Jordan reported on social media that he “almost died” from food poisoning after he had been to the restaurant.

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The food chain is still going, but their stock price fell by 2.7% in the hours after Jordan’s announcement. They have had to deal with a bad reputation ever since.

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'Gangnam Style' - The famous Korean pop song 'Gangnam Style' brought fame to the K-pop genre and to singer Psy. However, it also managed to boost the sales of his father’s company.

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'Gangnam Style' - Psy’s father, Park Won-ho, is the executive chairman of DI Corporation. After the hit song was released, the company’s market capitalization doubled in value. The shares have surged eight-fold since the beginning of the song. All that just for being Psy's dad!

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Michelle Obama - According to the shares that were bought during her time as First Lady of the United States, Michelle Obama was an absolute fashion icon. During her husband’s first year in office, the shares of the European brands she wore increased in value on average by 16%.

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Snapchat - Snapchat has had a hard time with celebrities. While model Miranda Kerr is a proponent of it, as her husband is founder Evan Spiegel, others have turned their backs. In 2018, Kylie Jenner posted that she no longer used the app much.

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Snapchat - Following her tweet, the share price of Snapchat fell so low that it lost US$1.5 billion. With just one tweet, she signaled to investors that Snapchat was no longer the trend.

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Rihanna - In 2018, Rihanna also came out about Snapchat saying that it makes light of domestic violence. This was after it ran an ad that let users choose whether they wanted to slap Rihanna or punch Chris Brown. It's clear that the game was not in good taste.

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Rihanna - Snapchat felt the burn after she criticized them. They lost US$800 million in the subsequent weeks. They have never really regained their ground after the fatal year of 2018, especially as many other platforms now offer the same services.

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Donald Trump - The former President of the United States was a prolific user of Twitter. As someone who wielded so much power, he broke the stock market several times and constantly prodded the delicate environment of the economy. He is now banned from Twitter and Facebook.

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Trump affected the share price most after he was personally investigated and after the first cases of COVID-19. When there is doubt cast on the president, people start to lose faith in the economy and sell their shares for money or more stable stocks.

Sources: (Marie Claire) (Showbiz Cheat Sheet) (ABC News)

See also: These celebrities all invested in cryptocurrency

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