Product Placement in Television

What are the television business and regulatory factors that have encouraged product placement and why do some broadcasters and national advertisers resent it?

A Coca-Cola Advertisement

Product placement is the combined effort from entertainment program producers and sponsors in which branded commodities are embedded in the content with the intent of influencing consumer behavior in favor of the sponsor. In other words, it could be defined as “the purposeful incorporation of a brand into an entertainment vehicle”. This vehicle could take the form of television, radio, video games, music records and even the written word (Russell & Belch, 2005).

Although there is a symbiotic relationship between the advertiser and the producer, the best interests of audience is left out of the equation. Another concern this phenomenon has raised is the compromising of artistic merit for commercial success. This industry had grown to a $3.4 billion industry as on 2005, with as many as 1,000 products being promoted through this channel. These numbers pertain to the United States alone. Needless to say, the worldwide figures are even more staggering. There is an ongoing debate across the world on the pros and cons of product placement. This essay presents some of the salient points in this debate (Moorman,, 2005).

The concept of product placement is nothing new in the world of advertising. Nevertheless, its magnitude and pervasiveness had grown exponentially in the last 20 years. Members of the Entertainment Resources and Marketing Association form the core marketing personnel of the placement-industry. The Association also acts as the mouth-piece for the placement-industry. The mission statement of the Association contains the phrase “to highlight the practice and establish a code of ethics” (Russell & Belch, 2005). The association is doing an excellent job in highlighting the practice. But, this essay is primarily concerned with the “establish a code of ethics” part. Started in 1991, ERMA has had 16 years to design a framework of ethics. Conventional wisdom instructs us that high profits and elevated ethics don’t go together. Given the impressive profits made by the public relations industry, the implication is that ethics have been neglected. The rest of this essay will look at the evolution of legislations and industry standards pertaining to product placement, by analyzing and contextualizing government regulations and industry sentiments. Also, the United States is taken as the subject country of investigation as the length of the essay only allows limited scope (Moorman,, 2005).

The concept really took off in the 1980s as a result of its success in the movie E.T. The placement in the film triggered unprecedented growth in sales of Reese’s Pieces. Prior to 1980s the industry was somewhat disorganized and industry practices were haphazard. Since the start of the 1980s though, the product placement industry and its parent public relations industry grew to become major players in commerce, economy and politics. The following snippet helps us understand the size of the placement-industry:

“BMW invested an estimated $20 million on the placement campaign surrounding the launch of its Z3 roadster; the campaign included prominent exposure in the James Bond film Golden Eye, as well as in most of the film’s, trailer and television advertisements. Spielberg’s Minority Report contained interactive advertising billboards within the film promoting its placement sponsors, including Mokie and Lexus – who reportedly paid $5 million to $7 million each to promote their placements. Marketers are now moving more aggressively, seeking prominent roles for their brands in feature films.” (Karrh, 2003)

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