The Growth of Product Placement - Term Paper Example

 The Growth of Product Placement “The industry is desperate to find clever ways to reach people, whether or not it has any legitimate value. When someone says, 'Let's put advertising in bathroom stalls,' another says 'Great. It's a captive audience.' (Petrecca, 2006, Pg. 1)” Introduction In a world where the advertisers and marketers have to battle for the attention of the consumer, not only due to hundreds of different channels but also due to hundreds of different ads, video commercials themselves lose their value. On the other hand, the placement of a product within a television show or as a part of the storyline in a movie is a significant improvement in terms of viewer attention and acceptance. Simply put, product placement advertisements are promotional ads that are placed by brand or product marketers using readily available commercial products or services. These are placed in commonly accessible entertainment or informational media and not shown as being separate from the show itself. Product placement can appear in theatre, movies, TV shows, music videos, computer games and even popular novels (Lehu, 2007). History and Background The idea itself became common in the 1980s, but the origins of the process can be traced back the birth of television shows. Even a simple thing such as an actor wearing a logo on his/her shirt can be considered product placement or a character’s dialogue where s/he extols the virtues of a particular product without it being shown is also product placement (Lehu, 2007). Today, major films often contain quite a few product placements of which a very good example is the positioning of BMW as a luxury and performance car by the link to cultural icons like James Bond. Such continued product placement can only help the brand in the future (Galician, 2004). In this manner, the secret of product placement seems to be directly connected with the way the product is presented to the viewer and the manner in which it is shown to be used. In recent years, the idea of placing products within television shows and movies has grown exponentially and while there are several reasons why marketers are pushing product placement, the cost of product placement is also rising. Therefore, for the marketers of the future, it is important to understand this vital aspect of marketing since it may become the primary method of advertising as compared to other systems. The Growth In 2005, the amount of company paid product placement rose by more than 40 percent and the total figure stood at more than a billion pounds. It is expected that it will cross the three billion dollar mark in 2006 and will only keep increasing every year in the foreseeable future. The simple reason for this is that brand managers are starved for ways to engage the public in appreciating and noticing their product (VOX, 2006). In a few more years, i.e. 2010, the paid product placement market is expected to be at more than 7 billion dollars and with this growth rate it would surpass traditional advertising (VOX, 2006). In fact, advertising within computer games and other entertainment options also connects with product placement as the gadgets used by the characters or the clothes worn by the players’ representation in the virtual world could have their own brands with time. American and Europe America is the largest market for paid product placement as the market has grown by almost 50% from 2005 to 2006. After that, Brazil and Australia come to the forefront with a lot of product placement while France takes the fourth position. At the same time, the combined European market shows that product placement as a method of advertising is one the rise and could be coming to the level of product placement in America (VOX, 2006). However, it must be noted that many markets within Europe have broadcast regulations which hinder the process of product placement as a form of advertising. The European Union is expected to take a more liberal approach to television when it removes the strict regulations on television broadcasters which would give them a sudden uplift with revenue coming from product placement and other advertising systems (VOX, 2006). The industries which are benefiting most from the process of product placement are the automobile industry, the apparel industry, food and beverage producers as well as travel and tourism operators (VOX, 2006). Such advertisers will not only connect with television producers for the placement of their products but also with movie producers since their products often need to compete on the idea of the brand image which the client receives. However, the explosion in product placement is only now coming into focus and this is only highlighted by the words of a forty year veteran of advertising Rance Crain, editor-in-chief of Advertising Age, who says that, “I've never seen things changing as much as they are now, advertisers will not be satisfied until they put their mark on every blade of grass (Petrecca, 2006, Pg. 1)”. The blame for the rise in product placement is also given to devices and TV control units which can automatically skip ads and thus render the millions spent on producing the ad itself quite useless (Galician, 2004). It must be noted that traditional advertising still takes the lion’s share of media based advertising since marketers spent more than $175 billion in advertising in America alone. Even more surprisingly, they spent another $269 billion on direct response ads and junk mail delivered to the houses of various consumers. The competition for the attention of the viewer is not only between individual channels, it is also between individual marketers (Petrecca, 2006). Too Much Advertising? The rise in advertising and product placement can be made clearer with the American figures provided by Petrecca (2006) since Americans are far less protected from product placement than individuals residing in the UK. The average American urban dweller saw 500 to 2,000 ads per day in the 70s. Today that figure is between 2,000 and 5,000. From 2004 to 2005, the time spend on advertising in the prime time went up by more than 20%. The integration of brands into television shows went up by more than 70% Shows that use product placement are also promoted by stores such as Wal-Mart and others as barter for promotion. The next generation of Ads could come onto iPods, mobile phones and video games as a part of product placement. In 2005, $21 million was spent on advertising in computer and video games which is a rise of nearly 40% compared to 2004. Petrecca (2006) suggests that the primary reason for this deluge of advertising on a global level and particularly in America is the ever increasing corporate drive for profitability. She says that, “Companies are under more pressure than ever to deliver rosy quarterly results, and top marketing executives have less time than ever to prove their mettle. The average tenure of a chief marketing officer at a major U.S. company has declined to 23.2 months (Petrecca, 2006, Pg. 1)”. In fact, advertising seems to be reaching absurd levels since some American schools have started playing commercial radio in school buses and commercial filled TV shows into their classrooms. Strangely enough, the Scottsdale Unified School District in Arizona is one of many such districts across the united states that have sold advertisement space on the outside of their school buses. Some schools go as far as selling naming right deals for their facilities. For example, two high schools in Wisconsin sold sponsorship rights of their student cafes to a commercial bank (Petrecca, 2006). An Example of Good Advertising While some companies have had problems with adverting and marketing, Apple stands out as a shining example of how product placement and marketing should be done in order to engage people. The advertisements for Apple computers have won awards and appreciation from advertising gurus as well as art lovers. Scott (1991) explains the persuasive power of the 1984 commercial as well as the artistic merits of the ad by taking a literary criticism approach to the video. The commercial itself can be described as a young female being chased by masked storm trooper like soldiers as she rushes past trudging workers wearing grey overalls with shaved heads. She approaches a massive screen where a big brother like figure is making a speech and she hurls a sledge hammer into the screen which causes a huge blast. A calm and smooth voice then announces that 1984 will not be like 1984 because of the Macintosh (Scott, 1991). This advertisement simply smashed every advertising convention known at the time since it only carried a minimal corporate identity, no message about the technical prowess of the computer, no mention of direct benefits to the individual, not even the price point of the item being offered. Simply put, as it was known in 1984, this ad could not even be considered advertising. However, if marketing is meant to motivate people then this approach certainly worked because when the Macintosh computer became available in the market three days after the airing of the ad, more than two hundred thousand people were waiting in lines across America to put their money down to buy one (Scott, 1991). A critical analysis of the same advertisement sounds eerily similar to a critical review which might be given to a film noir or to any other art film which has been highly acclaimed at the Sundance festival. Scott (1991) says that: “The theme of the commercial is one of individual action to prevent homogenizing tyranny and its form is a mirror of its theme. The spot communicates through an artful arrangement of images that has its own internal logic. The spot keeps the audience unbalanced and curious throughout the viewing, and thus open to affective experience through which it persuades (Scott, 1991, pg. 67).” Other campaigns such as the ‘think different’ campaign and the ‘switch’ campaign have also received compliments from the industry. The video campaign for ‘Think Different’ won an Emmy but it was the print campaign which made a significant impact for computer sales and also won several awards for the advertising firm of TBWA\Chiat\Day. The individuals used for the ‘Think Different’ campaign are some of the most admired achievers in the world and come from all sorts of fields like government, business, sports, performing arts and human rights activism (Elliott, 1998). As exemplified by Apple and as recommended by Petrecca (2006) such powerful campaigns which interest and engage the viewers are winning campaigns while mere placement of the product in a television show may not be the right path to success. Unsurprisingly, Apple is also very good with product placement since several top rated shows have products made by Apple as a part of their storyline or their use is made by the characters of the show. In the final analysis, I feel that product placement alone will not be able to get more people to buy a product and could even turn people off the product if the placement or the advertisement becomes intrusive. However, good and effective advertising along with powerful placement will certainly do wonders for the brand and the image of the company which the marketing manager is trying to create. It is up to the future brand managers of the world to make sure that advertising does not become something which the viewers are continually trying to avoid but rather something which helps them make intelligent and informed decisions. Works Cited Elliott, S. 1998, ‘Behind “Think Different”’, New York Times, [Online] Available at: http://www.electric-escape.net/node/565 Galician, M. 2004, Handbook of Product Placement in the Mass Media, Best Business Books. Lehu, J. 2007, Branded Entertainment: Product Placement & Brand Strategy in the Entertainment Business, Kogan Page. Petrecca, L. 2006, ‘’, [Online] USA Today, Available at: http://www.usatoday.com/money/advertising/2006-10-10-ad-nauseum-usat_x.htm Scott, L. 1991, ‘For the Rest of Us: A Reader-Oriented Interpretation of Apple's “1984” Commercial’, Journal of Popular Culture, vol. 25, no. 1, pp 67-81. VOX. ‘Global Paid Product Placement to Top $3B in '06’, MarketingVOX.com [Online] USA Today, Available at: http://www.marketingvox.com/archives/2006/08/17/global_paid_product_placement_to_top_3b_in_06/ Word Count: 2,035 Read More