The report by Datamonitor, claims that the cult of celebrity has reached a crossroads and an aging population means that audience growth is slowing.
It says that marketers must therefore pursue new tactics to avoid the pitfalls associated with celebrity-backed campaigns or celebrity-branded consumer packaged goods.
The celebration of fame has witnessed a dramatic upsurge in recent years, with reality TV, celebrity gossip magazines and the internet providing a 24-hour source of celebrity information.
However, Datamonitor's report says that this "explosive phenomenon" faces growing challenges, as many consumers are reaching saturation point and suffering from so-called "celebrity fatigue".
One of the problems is that celebrities are endorsing too many different products, undermining both the individual's and the brand's credibility.
David Beckham has featured in campaigns for numerous products including Gillette, Pepsi, and most recently for Sharpie pens. He has also fronted work for , causing something of a stir, as questions were raised as to whether he had been given "extra padding" for the underwear shots.
The report found that celebrity scandals or falling status can directly hit an endorsed brand's fortunes; sometimes celebrities' own personal brand strength can overshadow that of the brand they are meant to be endorsing.
Datamonitor cited ' past relationship with Pepsi as an example of this problem.
The report claims that the product itself is emerging as the next generation celebrity -- Apple's iPod and iPhone have transcended mere product status and become globally recognised identities with personalities of their own.
Richard Parker, consumer markets senior analyst at Datamonitor, said: "Consumers' relationship with these celebrity-like branded products are based heavily on participation and interaction, two behaviours that are desired, but rarely achieved by everyday people in their relationships with actual celebrity idols."
Datamonitor concludes that, for celebrity branding to remain effective, marketers must make sure that celebrity campaigns are underpinned by a strong brand message or story. This ensures that the celebrity can add value to the brand, rather than be used to make up for a lack of substance in the actual product.
The personality of the celebrity must be in sync with the personality of the brand and the endorsement deal should match the product with that celebrity's particular appeal.
Datamonitor also claims that avoiding the craze for "nonebrities", the reality TV breed of celebrity essentially famous for being famous, is crucial for brands looking to achieve longevity.