Product Placement

Inhaltsverzeichnis

Table of Contents:

1. Introduction.

2. Forms of product placement
2.1 How information is conveyed
2.2 What products are placed
2.2.1 Corporate placement
2.2.2 Image placement
2.3 Integration of products in the movie

3. Product placement vs. surreptitious advertising

4. Positive aspects of product placement
4.1 Image transfer
4.2 Circumventing advertising restrictions
4.3 Reaching the target group
4.4 Credibility (testimonial effect)
4.5 Cost effectiveness and multiplicator effect
4.6 Improvement of employee morale

5. Negative aspects of product placement
5.1 Ethical problems
5.2 Legal point of view
5.3 Credibility
5.4 Negative product placement

6. Examples

7. Conclusion

Glossary

Bibliography

1. Introduction

Growing competition, wider penetration of media and technological progress have led to new mass media multiplying the possibilities of advertising, but the “supply of information grew more than the demand for information” (Hartel 1993: 593).

The advertising industry was hit by these new developement; consumers felt bored and even annoyed by classical advertising. As a consequence, this industry tried to find new ways to present their products and to overcome reactance.

An official definition of product placement was often tried, but due to ever changing media there is no one definition. In the literature, however, it is often described as “the integration of products or services in cinema and television, whereby this integration should be noticeable for the spectator” (Shrimp 1997: 347).

In the 1920s some American companies tried to place their products on TV, but in these early years there was no real market for product placement, and so they even had to bribe cameramen to get their product on stage. Nowadays the frequency of occurrence is greater than ever, although “there is no scientific evidence that product placement is very efficient; it probably serves to enhance brand name awareness if nothing else” (Shrimp 1997: 347).

During the 1980ies, product placement was gaining more and more importance, but recently product placement has often evoked negative associations.

To sum up, product placement is a controversially discussed subject. It is up to the consumer to judge whether it is a subtle way to induce positive feelings and to foster brand awareness -- or if it is simply annoying and manipulative.

2. Forms of Product Placement

The different forms of product placement can be distinguished either by the form information is conveyed, the type of object placed or the degree of integration in the movie.

2.1 How information is conveyed

The most important form of product placement is the presentation of products and services in cinema and TV movies. Further possibilities of visual placement are newspapers and magazines.

Recently some novelists have even broken one of the last taboos and used product placements in order to eke out their earnings (e.g. Stephen King or Fay Weldon). Verbal placements in movies or radio plays represent additional, but relatively unimportant types of product placement.

2.2 What products are placed

Branded articles or services (which should be noticeable for the spectator) are by far the most widely promoted products. If new articles or unknown but existing companies are presented, one generally speaks of innovation placement (Hartel 1993: 68).

2.2.1 Corporate Placement

Here company names or distinct services are presented. Due to a high degree of substitution among different services, this type of product placement is a very vivid and descriptive way of making a service understandable for consumers.

2.2.2 Image Placement

Image Placement is a special type of product placement where the plot of a movie is tailored to convey a distinct message and to influence public image of a region or organisation. One of the most interesting examples of image placement is the movie Top Gun. When the movie was in the theaters, the number of volunteers for the US navy rose rapidly. Other typical examples are soap operas with a special setting. Schloßhotel Orth, for example, boosted tourism in Upper Austria.

2.3 Integration of products in the movie

Another important criterion for the distinction of different types of product placement is the degree of integration of the product in movies. In the case of On-Set Placement, the presented product is only of minor importance for the plot of a movie. As a consequence, spectators are often not aware of this product which could be replaced without spoiling or affecting the plot.

In a broader sense there is a smooth transition from On-Set Placement to Creative Placement. Creative Placement means that the product and the plot are phased and in this way it becomes part of the story and cannot be replaced by other products. A concise example is the empty coke bottle in The Gods Must Be Crazy. An African tribe finds an empty coke bottle, and from then on this bottle changes the tribe’s life completely.

If a product has to be adapted to the historic background of a movie, historic placement is used. You cannot use modern telephones in Western movies, and often product designs have to be assimilated to the typical design of that time (e.g. cars).

Generic placement represents another form of integration. Only the typical design of a product is shown (without using a brand name or a logo). This kind of product placement is only advisable for companies or products with a high level of publicity. Adidas sportswear (the 3 stripes) or Nike’s Swoosh are frequently used examples.

3. Product Placement vs. Surreptitious Advertising

Whenever you read about or discuss Product Placement, some ethical questions arise. Is it allowed to use subtle methods to sell one’s products? In fact Product Placement is often mixed up with surreptitious advertising, which from a legal point of view is not the same. In literature, surreptitious advertising is often described as an unpaid advertisement obtained by fraud, which is contrary to product placement, where the advertiser knows that s/he is advertising.

“Common examples for surreptitious advertising are the tricots of football teams. TV-stations which broadcast football games are not paid by the companies on the tricots, but they have no chance to quell those ads” (Kennedy 2001: n.pag).

Lots of efforts have been made to find a sharp precise definition in order to distinguish product placement from surreptitious advertising. One of the distinctions might be that the product has to fit in the plot and in addition it has to play a supporting role in making the movie look neat.

4. Positive Aspects of Product Placement

4.1 Image transfer

Companies try to benefit from the positive image of movie stars or celebrities who use or mention certain products. In this way, these items often turn into customers` most desired products.

4.2 Circumventing advertising restrictions

By using product placement, existing advertising barriers can be circumvented,e.g.,general alcohol or tobacco advertisements are sidestepped (Kuhlmann n.d.: 26). Furthermore, the famous “zapping” is avoided as product placement is integrated in the movie. It cannot be ignored by viewers and in the same way, reactance is avoided.

4.3 Reaching the target group

Product placements and plot always have to be and above all with the genre of the movie. Each genre has a distinct audience, a different target group, which can be reached with product placement.

4.4 Credibility (testimonial effect)

Products shown on screen within a film’s storyline have higher credibility than products in advertisements where the audience knows that what they see paid announcements. In case of exaggerated placements (e.g. Kaisermühlenblues: Puntigamer beer occurs more than 30 times in one episode) a company’s credibility is destroyed, and spectators easily get annoyed when they make out primitive efforts to promote a product.

4.5 Cost effectiveness and multiplier effect

As the film moves on from the theaters to video cassette and DVD sales, rental market and finally to cable and broadcast television, the total number of audience impressions for each placement multiplies (Vista Group 2000: n.pag).

With advertising costs skyrocketing, product placement may provide a very cost effective means of reaching a broad audience as it can be done for a fraction of the cost of normal advertising or publicity programs.

4.6 Improvement of employee morale

Employees of companies who use product placement as a promotional tool become proud of the company they work for (which is rather a US phenomenon).

5. Negative aspects of product placement

5.1 Ethical problems

Product placement as a subtle advertising instrument might influence spectators who do not know that they are being influenced. In some countries, legislation reacted to this problem and forced TVstations to fade in a special indication that this is an advertising series (e.g., Glücksrad or Der Preis Ist Heiß). Nevertheless, these series find a ready market as everybody knows that they are watching a commercial broadcast.

5.2 Legal point of view

In fact there is no common international law which regulates product placement; the lack of an international standard poses many problems for producers who want to sell their movies or series worldwide. This situation entails a lot of undercover product placement. Officially, advertising companies claim that they need a special product to foster reality and credibility since a brand gives movies an indelible imprint of realism. In real life, we eat, drink, wear, and drive brand-name products.

5.3 Credibility

If product placement is used too often or too obvious by a movie or series, the audience gets annoyed or even angry. As a consequence, the desired effect--the promotion of a product--might backfire, at best, the spectator makes fun of it.

5.4 Negative Product Placement

A new phenomenon in the film industry is negative product placement, with one company trying to harm another company by using its products in a negative way. One of the latest examples is the movie Pearl Harbour. The staff of a hospital uses Coke bottles as blood containers. In addition the colour of blood reminds the viewer of Coke’s corporate colour; a few scenes later Pepsi occurs in the movie in a less shocking scene. It’s now up to the audience to figure out which company paid for these placements.

“Negative branding puts the attacker in a position of advantage. But the price of this strategy is likely to be inescapability: Negative branding can become a part of a never-ending story in which both brands eventually lose” (Lindstrom 2001: n.pag).

6. Examples

The American candy producer “Reese’s Pieces” took the chance in 1982 and signed a placement contract with the producers of E.T. , which should result in an “increase of sales by 65%” (Buss 1998: n.pag). Bad luck for Mars, which refused to pay for its M&Ms. The tremendous success of “Reese’s Pieces” in E.T. was the birth of modern product placement.

A recent example of the placement of public institutions is Air Force One. All US military institutions now run a so-called “entertainment liaison” (Nuki 1999: n.pag) in order to increase their public reputation on an international scale. They voluntarily cooperate with producers, they even let them take pictures inside Air Force One, which naturally would be impossible if government had no return in terms of publicity. Other war movies, such us Top Gun, resulted in an increase of applications for the US Army.

James Bond movies are commonly known as a predominant example of placements. When the producers decided in 1995 that the British top agent should drive a German car (a BMW, due to enormous placement fees), Aston Martin was no longer ready to pay

- which should turn out to be an error: The number of sales of the BMW roadster jumped up, whereas the number of sales of Aston Martin declined.

In fact there are also problems concerning misconceptions of how productswas supposed to be perfect. The deal between Reebok and TriStar Pictures should be perfect, but it ended in a lawsuit. Reebok sued TrisStar Pictures for $10 million claiming it had violated a placement contract.

7. Conclusion

From a general point of view, product placement has become an essential revenue stream for studios and other media companies, no matter if the audience accepts it or not. A lot of blockbusters or series could not be financed without product placement as advertising companies are no longer willing to pay for traditional ads.

Those deals are organised by so-called “product placement agents-intermediaries”, who are hired by companies which want their goods to achieve greater exposure on TV or in movie theatre, resulting in an estimated annual turnover of € 32m (Nuki 1999: n.pag).

In fact, you cannot demand high quality productions with special effects without a realistic chance for producers to earn money to sum up: The spectator pays attention in return for affordable entertainment. Furthermore, any industry benefits from advertising, which means that the viewer’s job may depend on various sales strategies, such as product placement. Our economy depends on these strategies to boost sales, so it would be short-sighted if people refused product placement alltogether. Moreover - is there a viewer who cares if James Bond drives an Aston Martin or a BMW? Spectators who are intelligent enough to detect product placement should be bright enough to avoid being influenced by subtle means of product placement.

A solution to this problem would be the fade-in of a label which tells you that you are actually a “victim” of product placement, but this regulation would make placements less attractive for companies, and soon they would search for other methods to convey their message.

On the other hand there is a genuine risk: the loss of artistic value. The audience normally assumes that producers put all their enthusiasm into a movie or book; we (mostly) suppose they do not work just for the money but for higher intentions. Would we nowadays admire Shakespeare’s plays if we knew that he only wanted to boost Verona as a holiday resort?

“But I would say to any young artist tempted: you have only got your credibility, one wrong move and you can destroy something that you have spent years and years building up” (Kennedy 2001: n.pag).

In fact, films would not be the same without branded products: Every brand itself comes encoded with a certain symbolism, and so they provide an important form of nonverbal communication. A driver of a Ferrari certainly has a different charisma compared with a driver of a Chevvy. Sometimes a brand used by an actor tells us more about him/her than countless dialogues. As a conclusion, product placement should only be used as a complementary advertising tool. The main incentive to produce movies or to write books should remain entertainment or education, mere frameworks to present products surely will not be accepted by the audience.

“Place a product today, and if you’re lucky, maybe tomorrow, someone will remember. And if not -- well, that’s show biz” (Shinan 1999: n.pag).

Glossary:

Brand Awareness (p.3)

Next to the increase of sales brand awareness is one of the most important goals of advertising. By placing brands time and again, people become aware of a certain brand, which increases the value of a brand name. It is not always the advertiser’s sole intention to boost sales -- consumers should know that there is a special product for their special need; prestige also represents a kind of “need”.

“Findings from the first study revealed that 63 percent of shoppers surveyed in the past week relied on brand awareness as the leading factor in purchasing online, the companies said“ (Cox 2001: n.pag).

Entertainment Liason (p.10)

It can be described as the alliance between the movie industry and public

(US) institutions. Both benefit from each other. Hollywood gets access to genuine scenery, but in the same way a blockbuster should provide a positive image transfer.

’’All four wings of the American military - army, air force, navy and marines - now run what are known as ‘entertainment liaison’ operations in the heart of the film industry” (Langton 1999: n.pag). Reactance (p.3)

If consumers are confronted with advertising, they (un)knowingly refuse the sales message. As a consequence, advertisers try to convey the message in an explicit, acceptable and pleasant way so that the audience perceives and obeys the content.

“Two studies tested the opposite predictions of reactance and dissonance theory with regard to the responses of the Germans to the introduction of the Euro. Reactance theory predicts that persons who are convinced that the Euro will replace the DM evaluate the Euro more negatively than less convinced persons” (Greitemayr 2001: n.pag).

Surreptitious Advertising (p.6)

It can be described as a subtle way of advertising and is obtained by fraud. As there is no clear (international) legal distinction between product placement and surreptitious advertising, these phenomena are often mixed up.

§ 8. Surreptitious advertising

(1) Advertising which, regardless of the manner or means of publication and, given ordinary attention by the public, is not readily recognised as advertising or is not readily separated from other information published simultaneously in the same advertising medium is deemed to be surreptitious advertising (Estonian Association of Advertising Agencies 1997: n.pag).

Testimonial Effect (p.7)

Product Placement is partly based on a testimonial effect, which means that actors use products in an idealised way. In other words, the use of an item in a movie underpins brand credibility as actors often represent role models. Furthermore, the use of products by popular actors is meant to prove a product’s quality.

“Build credibility and brand preference by positioning your product in a show regarded by listeners as an authoritative source for movies and videos. Create an even stronger testimonial effect by requesting host reads and product endorsement” (Dane 2001: n.pag).

Bibliography:

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http://www.businessweek.com/1998/25/b3583062.htm.

English Seminar Product Placement page 16

12 November, 2001

Cox, B (2001): “Brand Awareness Drives Online Shoppers”.

http://www.internetnews.com/ec-news/article/0,,4_917091,00.html.

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Dane, B. (2001): “Movie Show Advertising Features”. http://www.movieshow.com/ad.shtml.

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Estonian Association of Advertising Agencies (1997): “Advertising Act”. http://www.eral.ee/rm/ls_reklaamiseadus_eng.htm.

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Greitemayr, T. (2001): “The Introduction of the Euro: Acceptance or Reactance in the Population?”.

http://verlag.hanshuber.com/Zeitschriften/ZSozP/01/sp0103.html#soz0103_09.

17 November, 2001

Hartel, U. (1993): “Werbung zum Kinofilm“, Zeitschrift für Urheber- und Medienrecht43: page 128-132.

Kennedy, M (2001): “And Now, A Few Words From Our Sponsor: Just Give Us A Mention.” http://books.guardian.co.uk/news/articles/0,6109,546602,00.html.

27 October, 2001

Kuhlmann, E. (n.d.):“Vorlesung zu Business und Dienstleistungsmarketing“. http://pm_box.ww.tu-berlin.de/marketing2/grundstudiumsfolien4.pdf.

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Langton, J.(1999): “Who calls the celluloid shots?”, The Sunday Telegraph (online) http://www.bilderberg.org/product.htm.

3 December, 2001

Lindstrom, M. (2001): “Negative Product Placement”.

www.clickz.com/brand/brand_mkt/article.php/843871.

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Nuki, P.H. (1999): “Products Placed On Top TV Shows”. The Sunday Times (online). www.bilderberg.org/product.htmn.

29 October, 2001

Shinan, G (1999): “Product Placement in Movies-is it really so bad?” http://www.csmonitor.com/durable/1999/02/10/pllsl.htm.

29 October, 2001

Shrimp, T. A. (1997): “Advertising, Promotion and Supplemental Aspects of Integrated Marketing Communications”. 4th ed. University of California: The Dryden Press.

Vista Group (2001): “Why Vista Group Product Placement.”

http://www.vistagroupusa.com/serv02.htm. 29 October, 2001