Product placement is a fast-developing form of advertising that has evolved throughout the early 21st century. The emergence of product placement within entertainment has coincided with diminishing interest in traditional advertising. As companies find consumers less attentive to messages through traditional advertising media, they are using product placement to connect with customers.
Traditional advertising refers to the use of common media classes to deliver advertising messages to target markets. Television, radio, magazines, newspapers and the Internet are the five media types typically considered as traditional media. These media have long been part of advertising plans for large and small businesses; however, increasing inattentiveness for messages delivered through these media has causes brand advertisers to consider new ways to reach out to their audiences. Traditional advertising remains a major part of long-term brand building for many companies.
Product placement, sometimes referred to as "branded entertainment," is the infusion of a brand's products into an entertainment format. Brands pay for, or provide monetary consideration to, producers of movies, television shows, video games, web videos and other types of entertainment for the inclusion of the brand within the entertainment presentation. Jonathan Small points out in his March 2011 article "Branded Entertainment Mythbusters" that advertisers will spend $5.5 billion by 2014 on online video ads alone.
Product Placement Results
When product placement is seamlessly worked into entertainment, business results have proven quite successful at times. Marketing consultant and adjunct professor Max Sutherland shares several product placement success stories in his February 2005 article "Why Product Placement Works." Pinot noir wine sales went up 22 percent in January 2005, shortly after it was a major component of the prominent film "Sideways." Long before product placement become common advertising lingo, the 1993 Tom Cruise movie "The Firm" contributed to a 50 percent increase in US sales of Red Stripe beer within a month of the film's release.
Product Placement or Traditional Advertising
Traditional advertising does not appear ready to disappear. Companies still value the well-established benefits of traditional media. However, some companies have become frustrated with low response rates on television ads and high total costs. Product placement interest continues to climb. A 2011 Super Bowl ad even spoofed the concept of product placement when a Bud Light commercial depicted a movie incorporating the brand throughout the plot to get free Bud Light. As of early 2011, traditional advertising and product placement both offer benefits when ad plans are well-developed. For product placement to work, brands must prominently, but subtly appear in a movie, television show, video game, or web video.