Product Placement: Its Purpose and Whether It Works - Research Paper Example

? Product placement: Its purpose and whether it works Introduction Marketing is a vital aspect of effective business strategy that is mainly people centric with major focus on meeting the demands of the customers. Various aspects of marketing are important factors that greatly facilitate in creating a niche position for the products within the desired category. The diversity of consumers and their changing needs are critical inputs that necessitate companies to target specific group of customer segment and create/ meet their requirements. In the highly competitive environment of current global businesses, product placement becomes a key challenge to attract and retain customers. The huge ramifications of product placement within the highly fragmented market are critical to ensure that brand desirability is maintained it retains its competitive advantage over its rivals. 2. What is product placement? Product placement broadly refers to the firm’s effort to design and market its products in such a manner that its image occupies a distinct place in the minds of the target group/ segment. Indeed, the product placement encourages customers to understand and view differentiation of one specific product as against similar other products from different companies. It is also known as brand positioning and conceptualizes as to how the products should be portrayed amongst the target segment. The value proposition projected becomes important elements of product positioning as against those offered by its competitors which make it attractive for customers. It is also believed that product placement uses various strategic options based on myriad or specific attribute that significantly contribute towards garnering customer loyalty on a long term basis. 3. Main objective of product placement The main objective of the product placement is to create awareness of the product and clearly differentiate its attributes so that customers can identify it from various similar products offered by different firms. The market positioning of the product ensures that customers continue to prefer the products and do not shift their loyalty to other brands. The product placement helps to emphasize it and enforces its brand equity. Another important objective is to increase sales and revenue for the product and firm. 4. Need for product placement In the contemporary times, market has not only become more competitive but also complex in its heterogeneity of consumers, products and market mechanism. Wilson and Gilligan, (2003: 4) assert that rapid globalization and fast advancing technology has redefined marketing as ‘an approach to doing business’. Target market and segmentation help marketers to penetrate new market and at the same time, build up image of perceived value proposition that is credible, feasible and sustainable. By creating a niche position, the firms are able to gain competitive advantage and also build a committed clientele. In the competitive environment, positioning of product considerably facilitates retaining of customer and also expansion of customer database. Need for product placement is also important because market is infiltrated with huge number of similar products. Product placement helps the customers to make decisions based on his experience and perceived need which are met by the product of the defined firm. The unique advantages of the products and their usefulness are key factors that attract new customers while keeping the old. The customer is always interested in the final result of his purchase so he needs to be shown the extra benefits that he would be getting on the purchase. Product positioning helps him/her to make appropriate buying decision which would satisfy his demands and make it easy for him to decide. 5. Market significance of product placement Market position of products is integral part of business strategy that relies on exploiting the preferences of the masses. Products are turned into brand when they carry certain credibility vis-a-vis quality, price environment sustainability etc that is backed by the firm’s credibility. Kotler (2005) has emphasized that brand creation is required because products are same. The brand creation of products focuses on creating a convincing market for quality goods whose perceived values are realized on consumption. This is a very important facet of customer satisfaction. It also becomes major catalyst for product placement within the industry. Good market positioning of the products is vital for all type of companies who wish to expand and exploit global market to gain necessary leverage. Shultz (2001) asserts that it is the end-users who now control the markets rather than the marketers. The various inter-related factors like consumers’ preferences, technology, environmental responsiveness etc., which impact the markets, have become highly relevant and make the contemporary business more competitive. Entertainment industry has become important platforms for effective product placements. Many scholars claim that entertainment channels promote involvement of audience and become effective means of delivering messages regarding products. Thus, they become the most obvious choice for product placement by the companies (Gupta et al., 2000; Loeb 2000). Good product placement encompasses various such attributes in the products and makes them attractive for customers. 6. Factors influencing product placement Product placement serves as major marketing tool with multifaceted benefits. Various measures and compulsions that influence market positioning of products are crafted to meet the needs of the people or even create need for them amongst the customers. In the current times, product placement has become fundamental to the changing concept of modern marketing. It encompasses the following strategic options: 6.1 Brand promotion and equity Brand promotion ensures that the product maintains a high standard of excellence at a price that a customer is willing to pay for. It also provides the customer with a quality product which satisfies his needs, making it as one of the key reasons that brands enjoy customer loyalty and also attract fresh clientele. Brand promotion and equity provides product with distinct attributes that are highlighted through product placement within the wider audience. Indeed, it enhances the relevance of product placement as main objective and critically underpins the brand image as key factor. Ward et al., (1999) assert that brand is able to withstand the test of time mainly because the credibility of firm becomes crucial factor that delivers its promise of perceived value for the customer. Product placement reinforces the value proposition of brand and therefore lends credibility not only to the product but also to the firm. 6.2 Market segmentation Market segmentation is another facet that strengthens the need to differentiate elements and help create niche market. It also facilitates in exploiting the potential of segmented target for the existing and new products and meet the challenges of their changing requirement. Product placement emphasizes target segment and also attracts new ones that gives a big boost to the firms. Most importantly it motivates and lures customers to experience the satisfaction that product placement projects. 6.3 Environmental responsiveness and market sustainability In the current times of fast depleting natural resources and climate change, environment consciousness and responsiveness has increasing emerged as crucial paradigms of marketing. The product placement has the ability to raise environmental consciousness within the broader precinct of marketing imperatives and force a unique responsiveness amongst the consumers. 7. Tools of product placement Today, markets cater to the system as a whole rather than exclusively to the customer. The complementary nature of various elements within the system can be judiciously exploited for product placement so as to enhance the awareness of the brand. Entertainment channels are most popular means of product placement. When product is uniquely placed that highlights its use, it corroborates the credibility of the firm and becomes more visible within the broader context of social interaction. It influences the self concept and personality traits and may reflect the lifestyle that is desired. Hence various media and advertising are main tools for product placement. The various tools used for product placement also serve as revenue inlets for the firms. The use of product within the various media like TV, films and event industry fetches revenue in the form of rental or as fee. Manning-Schaffer (2006) assert that while in 1975, 25% of all product placement deals were free but by 2005, most of them got converted into revenues for companies leaving only about 3.4% of the deals free! This is vital information that showed that product placement was not merely a publicity tool but also an important means of revenue, especially in big budget films and TV shows. 7.1 Television soaps and films Entertainment channels like television and films are strong media where product placement considerably impacts consumer psychology. Product placement mostly comprises of characters of soap opera or films using the products in manner such that consumer can identify with it. Hence, when product placement is observed in television shows and films, the consumer is better able to identify with it, especially with relation to the story. If the character is famous, he also serves as major motivation for the consumers to imitate and use the product. It is for these reasons that now television advertising, TV shows and films are increasingly preferred means of product placement. Now most of the advertising budget is allotted for TV as their content are decided by the target group. Schiffman and Kanuk (2007: 215) assert that modeling learning theory is the process through which individuals learn behavior by observing the behavior of others and the consequences of such behavior’. People tend to identify with the models and events described in the advertisement that showcases the product both within the TV shows and advertisements. This is the main objectives of the advertisements and ad campaigns. The visuals and the textual contents are able to convey and effectively deliver the message as intended for the projected product. 7.2 Print media Advertisements of products and services placed on various newspapers, journals, magazines, hoardings and books also broadly ensure that the product place is able to influence the psyche of the consumers. The effectiveness of product placement is displayed when it is able to convey the needs of the target group. All the advertisements of McDonald’s are highly effective because they are able to capture the needs of the target segment. The tag line, ‘I’m lovin it’ is hugely popular because it promises to fulfil the desires of consumers on consumption. The same is true for Nokia’s brand identity with connecting people. Both the tag lines project an inherent desire to experience something unique. The major intention is to target common man because they are the major consumers for any brand to become popular. 7.3 Event management It is another important channel that uses direct marketing for product placement. The various events organized for corporate world, academia and individuals (like marriage, festivals etc.) often use products and services as a means of advertisement. The people could be showcasing the apparel of famous designer or television, bike etc. of prominent companies become part of event. The placement of product in events are also good way of attracting customers and creating awareness. 7.4 Virtual world In the era of advancing technology, product placement has transcended the traditional entertainment channels like TV and films to enter into cyber space. The virtual world of video games has become a popular platform for product placement. The products are either shown within the game or the logo regularly crops up that reinforce the brand image (Healy, 2007). Interestingly the social networking sites, surf engines and cyber space as a whole has now emerged as most accepted way of product placement. 8. Conclusion Product placement necessitates synergistic mix of promotional channels that hugely facilitate more efficient and integrated approach to marketing communication. It is also very important means of gaining competitive advantage and establishing credibility in the volatile market. The product placement is very effective mechanism of not only creating awareness of the product but also creating need for the product. The very fact that it is focused on human needs becomes decisive criteria for consumers to experience its consumption as portrayed in the product placement. It can thus be concluded emphatically that product placement serves its purpose of effectively communicating the need for the product. At the same time, the various tools used in product placement contribute in expanding its scope and strengthening the firm’s credibility amongst the consumers. Product placement indeed helps create awareness and need for the product amongst consumers, thereby achieving its purpose. (words: 2025) Reference Gupta, Pola B; Balasubramanian, Siva K. & Klassen, Michael L.(2000). Viewers’ evaluations of product placements in movies: Public policy issues and managerial implications. Journal of Current Issues and Research in Advertising, 22 (2), 41-52. Healy, C. (2007, July 1). Hey, man, let’s play video game dress-up. New York Times, 1. Kotler, Philip. (2005). Toward Stronger Marketing. unpublished presentation to the ARF, “Future of Advertising” Conference, Chicago, 10.24.05. Loeb, Jeff.(2000). Fine line. SHOOT, 41 (7), 4. Manning-Schafel, V. (2006). Brands get celebrity exposure. Brandchannel.com. Retrieved from: Ward, Scott., Light, Larry and Goldstine, Jonathan. (July-August, 1999). What High Tech Managers Need to Know About Brands. Harvard Business Review, 85-94. Schiffman, L & Kanuk, L, (2006). Consumer Behaviour. 9th ed. London:Prentice Hall. Shultz, Don E. (February 12, 2001). Bid Farewell Strategy based on old 4Ps. Marketing news, 35(4). Wilson, R. and Gilligan, C. (2003) Strategic Marketing Management: Planning, Implementation and Control. Oxford: Butterworth Heinemann. Read More