Swag Machine Is Big Hollywood Business

As a talent coordinator for events like the Emmys and Grammys, she needed to make sure that celebrities arrived on time for rehearsal and waited patiently until they were needed. It was the late 1990s, and $10 million paychecks had become routine for major stars. Asking them to sit on folding chairs for two hours while waiting to walk across a stage was like asking a preschooler to eat peas.

Wood had to sweeten the deal somehow. So she invited a few fashion designers to set up free displays of their trendiest wares backstage. It occupied the stars and gave the designers one-on-one access to their most coveted customers — the ones who can turn a simple T-shirt into a fashion craze just by wearing it in the presence of the paparazzi.

Like most creative ideas in Hollywood, her concept has been copied and exploited for huge profit. Less than a decade later, everyone from highbrow retailers like Escada and Chopard to supermarket staples like Altoids and Tide are using red-carpet events to get their products into famous hands.

"Gifting" has become a verb.

On the morning after this year's Oscars, losing nominees in the six major categories will receive gift baskets stuffed with nearly $50,000 worth of goodies, including a stay at the lavish MGM Mirage in Las Vegas and a gift certificate for LASIK eye surgery. The baskets are being created by Lash Fary, whose company, Distinctive Assets, is Wood's main competitor.

Temporary villages now sprout up at events like the Sundance Film Festival, offering everything from the newest BlackBerries to free on-site teeth whitening. At Sundance this year, celebrities from lists A to D were seen carting away armloads of high-ticket electronics and designer ski gear. The glut of celebrity swag sometimes drew more attention than the festival's films.

There seems to be no limit to what's being given: Presenters at this year's SAG Awards visited a backstage "talent retreat" where the offerings included a trip to the new St. Regis resort in Bora Bora, a diamond necklace and even a gift certificate from beverlyhillsphysicians.com for Botox or other "cosmetic procedures."

While much of this is described as "a gift of thanks" from event producers, Fary is blunt about the realities of giving free stuff to stars who already receive huge salaries. "Celebrities are a very effective way to sell a product," he says. "They always have been."

With the spike in media coverage of every aspect of celebrities' lives, they've become an even more lucrative tool. "Get your product out there and get immediate impact without having to pay for a celebrity endorsement. That's the goal," says marketing expert Adam Nelson, CEO of Workhouse Publicity. "Just get a picture of them holding the product."

It's a fairly foolproof process. A dozen magazines and entertainment television shows will probably jump at the chance to run those photos, depending on which stars and products are involved.

"It works for us because we do a lot of stories on trends and what's hot," says Samantha Meiler, editor of Life & Style Weekly. "Because they often use brand-new things, that helps us because we can associate the product with a celebrity."

But as practical as swag giveaways may be for advertisers, what's the lure for major stars?

Gifts worth $50,000, while obviously lovely, amount to a few days' pay for an A-lister. And much of this "free" merchandise comes at a price: posing for those all-important photos before leaving the room with swag in hand.

The photo op takes only a moment, but it can result in an image that appears repeatedly in magazines. The recurring sight of a highly paid actress gathering up endless freebies can irritate fans who earn less in a year than the value of a single gift bag.

Fary says many stars are willing to risk the fans' ire for a chance to check out new products.

"They can't just go to the mall like a regular person," he says, because they'd be mobbed. "Or they can, but it won't be very much fun."

Still, the intensity and ubiquity of celebrity swag has caused some stars and designers to refine their approach. Gifting isn't going away, but in some cases it's being repackaged to make it a bit more palatable for everyone involved.

Some advertisers, such as Motorola, have shied away from setting up a suite amid the frenzy of Sundance. Instead, they've created a permanent gifting office in Los Angeles, where stars can peruse their products in relative privacy. A number of other companies that did participate in the Sundance swagfest, such as Volkswagen, donated some of their merchandise to charity.

And a handful of actors, including Lili Taylor and Daryl Hannah, opted to hand over their Sundance swag this year to an environmental charity called Global Green, as part of a campaign called "Got Plenty?," organized by the green-living magazine Plenty.

"We weren't shaming people," says Plenty's editor-in-chief, Mark Spellun. "The pitch wasn't just, 'Hey, you've got $10,000 worth of merchandise under your arm, so give us some.'"

The donated items were being auctioned on eBay through the month of February, with the proceeds going toward efforts to stop global warming. Taylor, who donated some pricey skin care products, was happy to oblige.

"I crossed the swag line and found myself overwhelmed," she said through Plenty's publicist. "Then I saw 'Got Plenty?' and they pulled me back over. Better to give than get."