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MARKETING: Product Placement - The Future of Advertisement
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altP
roduct Placement, also known as embedded marketing, has long been a tactic for firms to strengthen their brands and to build brand recognition. Large corporations spend millions of dollars a year to help finance big budget movies and other forms of entertainment. The new Superman movie, “Man of Steel”, set a record this summer when it was reported that it took in USD 160 million via 130 different partners. Everyone from Gillette, to the fast food burger chain Carl's Jr, to the US National Guard are all trying to tie their brand to a vessel that will gel with their brand image and help build sales. However, the use of product placement is not limited to only giant multinational firms. Small businesses are also getting into the mix when possible, especially in the world of television. Local businesses are usually able to pay or give some kind of donation in order to get some airtime. Whether we are talking about using product placement in this summer's biggest blockbuster or in the hottest reality television show, companies of all sizes can benefit from the use of product placement. 

What is product placement? 
Product placement is an advertising technique used by companies to promote their products through a non-traditional method, usually through film, television, or other media. Today, companies are leaning more heavily towards using product placement and other forms of non-traditional methods to advertise their products. In today's world with online streaming and DVRs where people can fast forward through commercials, product placement offers companies a more effective way to promote their product by integrating it into the program their target audiences are watching. One of the most famous successful examples of product placement is in the movie E.T. The main character, Elliot, lures the cute alien into his home using Reese's Pieces. Spielberg originally wanted the scene to feature M&Ms, but the Mars company turned him down. Hershey, on the other hand, said yes and the result for them was a rise in profit of 65% in the weeks following the movie. Another successful example can be seen in the 2003 film, Lost in Translation. Bill Murray plays an aging film star who is in Tokyo to film a commercial for Suntory Whisky. The movie helped launch the Japanese whisky brand to international success shortly after the film's release. 

Chinese firms are also getting in on the product placement action in order to help promote their brands to an international audience. In the film “Transformers 3”, the main character, Shia Labeouf, can be seen putting on a Metersbonwe T-shirt while later in the movie a scientist is drinking Yi-Li, a Chinese milk brand. The popular sitcom “The Big Bang Theory,” though it doesn't actually appear on Chinese television stations, is hugely popular in China via online steaming websites. As a result, Chinese marketers have been collaborating with The Big Bang Theory and other popular shows in order to try to cash in on the potential of product placement. According to Janie Ma, an entertainment marketing director at Ogilvy Beijing, “Chinese consumers are wowed when they see Chinese brands in American media. It polishes the brands’ local image.”

altHow Does Product Placement Work?
There are three basic ways product placement occurs. The first way it occurs is naturally. Sometimes product placement will happen because actors need props. Perhaps in the heels of a major action scene, the hero has just finished an epic fight and needs a refreshing beverage so he grabs a Dr. Pepper and drinks it on screen. Or maybe there is a car chase scene, and the main character is driving a Mini-Cooper because the stunt coordinator recognizes that Minis handle better and can fit into tighter places.  

However, in today's hyper-media society, it is more likely that the brands you are seeing in movies and on TV got there through an arranged deal. This can happen in one of two ways. Financial compensation is obviously a sure fire way to get your product some airtime. Heineken paid USD 45 million to have James Bond ditch his trademark martini for a lager beer in last year's 007 instalment, “Skyfall”. 

The other arrangement that allows us to witness product placement onscreen is through a trade-off of integration or placement for a supply of product. For example, a beverage company such as Snapple might arrange a deal with a popular sitcom where in exchange for some airtime, Snapple will provide the cast and crew with an ample supply of drinks. Apple is a master of this kind of arrangement. The company claims that they do not pay for product placement but it is hard to watch any sort of multimedia without a character using or referencing an Apple product. In 2011, Apple products appeared in 891 different TV shows and 40% of Hollywood box office movies. 

The Future of Product Placement
altMany analysts believe that the revenue produced through product placement will continue to increase rapidly as a growing number of savvy consumers fast forward through advertisements using DVR and look to the internet to stream free content. In 2010, global product placement promotion was estimated by some to be as high as USD 25 billion. However, as demonstrated in Morgan Sperlock's documentary/film /advertisement; “Pom Wonderful Presents: The Greatest Movie Ever Sold” (a film about product placement that is made possible through excessive product placement, as seen in the naming rights of the movie) this growing trend could lead to over contamination of not only the entertainment industry, but also the recording arts and publishing. 

The recording industry has witnessed decades of decline due to piracy, the internet, peer-to-peer networks, and digital music stores where you can buy single songs instead of whole albums. As a result, recording executives have been seeking advertisement dollars for “lyrical insertions,” especially in the realm of hip hop. The song “Pass the Courvoisier” by P. Ditty and Busta Rhymes helped to cause a jump in sales by 20% for the premium adult beverage. McDonald's at one point was offering cash incentives for rappers to incorporate Big Macs into their lyrics. 

The publishing industry, which has also been taking a beating this decade because of increasing use of tablets, e-readers, and the internet, is also looking for new ways to generate revenue and survive. Newspapers, magazines, and even books are being filled with product placements. Elementary and high school math text books are peppered with the mention of brands like Oreos, Gatorade, and Nike. Author Fay Weldon received GBP 18,000 from jeweller Bulgari to mention the company at least twelve times in the novel. She went above and beyond this call, titling the book “The Bulgari Connection” and mentioning the jeweller 34 times. Meanwhile, in the world of sports journalism, ESPN has set up a column written by Bill Simmons titled “Miller Lite Great Call of the Week”. As technology advances and consumer trends shift, we may not be far off from a future where product placement invades not only arts and entertainment, but perhaps our social circles. “Sony presents your best friend's Facebook status update” or “Tsingtao presents your daughter's wedding invitations.” As Matt McAllister, a leading media scholar once wrote, "advertising is geographically imperialistic, looking for new territories it has not yet conquered." Let's just pray that we never reach a stage where advertisement takes over the world, so to speak. 
 

by Justin Toy
 
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