Product Placement pt 2 of 2

Product PlacementAdvertising for the “skip” generation.

Product Placement:On the Rise in Music-

Record labels are attempting to make videos a revenue source and not just a marketing tool

The money is often used to offset the video’s cost, which is usually shared by the artist and label

Fast becoming the go to place for any brand looking to engage with a younger audience

Product Placement:On the Rise in Music-

By 2017, video will account for 69% of all consumer internet traffic- music is a key beneficiary of this shift

Technology is advance so that products viewed in music videos will be clickable and purchasable

Product Placement:On the Rise in Video Games-

There are 132 million teen and adult gamers in the U.S.- nearly ½ of all households have a game console

Games offer an immersive environment that can be enhanced by the incorporation of a branded product

Product placement is a partnership with the game developer


Games typically use brands in three ways:

Compiled by author from source: lawofthelevel.com

Branded Entertainm

entProduct

PlacementExtra-

Contractual Use


Things to consider when advertising in video games:

Compiled by author from source: lawofthelevel.com

Quality Placement

ControlDuration

and Terminati

on

Product Placement:Money Breakdown-

For a brief movie mentions it costs an average $22,000 per placement

Primetime T.V. series integrations can run $3 to $10 million

The average cost to produce a T.V. commercial is $392,500

Prop product placement average around $50,000 per brand for an unlimited number of placements

Product Placement:Relationship with Revenues-

When T.V. or movie revenues are high, product placements exhibit a positive relationship- unless placement is used in excess

Consumer benefits from product placement don’t differ between movies with different budgets or qualities

Product Placement:Revenues & Excessive

Placements- When the number of placements passes a saturation point, revenues

are affected

Excessive placements generally appear to be associated with poorer box office performance

Product Placement:Indie Films-

It helps the bottom line

Sponsors help with parties and marketing

Securing a placement can be easy

It creates authenticity

Compiled from authors at indiewire.com

Product Placement:Integration is Risky

Business-

Compiled from authors at priceonomics.com

Timing• Integration in a movie or TV show means taking on the risk that the content

will be launched early, delayed, or even canceledCreative Control

• Integration means playing by someone else’s rules

Brand Association• A brand partnering with, or integrating into, a star-driven medium bears the

risk of that individual’s own brand imageCommercial Failure

• Paying a few million dollars to integrate into a movie that becomes a box office hit is a fantastic deal- Paying a few million to integrate into a bomb is an embarrassment for the brand

Consumer Burnout• As integrations become more common their omnipresence tend to annoy

consumers, damaging brand equity

Product Placement:Digital Brand Placement-

Digital placement is fundamentally different- Products on screen were never there in the first place

Digitally adding brands into old content has existed in T.V. for years, but more recent for music videos

Product Placement:Retroactive Product

Placement-

Image source: Google Images

Product Placement:Retroactive Product

Placement- Ads can be inserted, replaced and deleted almost instantaneously

Product placement can be added to suit various audiences or to make scenes available to multiple advertisers

Companies can also target audiences by localizing ads

Success Stories of Product Placement:

Risky Business- Film was released in the 1983

Tom Cruise wore a pair of Ray-Ban Wayfarer sunglasses

Company was thinking of discontinuing the line before the movie

18,000

360,000

Units Sold

1981 1983

Compiled from authors at brandongaille.com Image source: Google Images


E.T.- Film was released in 1982 and

become one of the highest grossing films of all time

Hershey agreed to have Reese’s Pieces to be used in the film

Profits went up 65% in just one year



GoldenEye- Film was released in 1995

BMW signed a film deal to have their Z3 featured in film

The vehicle wasn’t even on the market yet, but the movie resulted in 9,000 pre-orders for the car


Success Stories of Product Integration:

The Italian Job (The Remake)- Film was released in 2003

Mini Coopers were used as the get away cars

BMW saw a sales increase of 22%- even though the movie only saw moderate success



Transformers- Film was released in 2007

The Autobot version of the Chevy Camaro help sell over 60,000 units by the end of 2009



Top Gun- Film was released in 1986

The US Navy’s number of new recruits increased by 500%


Product Placement:Controversy-

The trend of integrating products makes some uneasy

Some worry that placement in realistic shows influence consumers and distort their perception of the world around them

Placement also may reflect a world where only the product is worth using – It spins the wheels of a commercial feedback loop

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Works Cited Brown, Erika. "Product Placement on the Rise in Video Games - Technology & Science - Tech and Gadgets - Forbes.com | NBC

News." Msnbc.com. NBCNews.com, n.d. Web. 22 Feb. 2016. <http://www.nbcnews.com/id/13960083/ns/technology_and_science-tech_and_gadgets/t/product-placement-rise-video-games/>.

Gaille, Brandon. "46 Product Placement in Movies Statistics." BrandonGaille.com. N.p., 23 Jan. 2015. Web. 22 Feb. 2016. <http://brandongaille.com/46-product-placement-in-movies-statistics/>.

Genco, Steve. "A Neuromarketing Perspective on Product Placement in Movies and TV Shows : Intuitive Consumer Blog." Intuitive Consumer Insights. Intuitive Consumer Blog, 15 Oct. 2015. Web. 22 Feb. 2016. <http://intuitiveconsumer.com/blog/a-neuromarketing-perspective-on-product-placement-in-movies-and-tv-shows/>.

Hobbs, Thomas. "Why Brands Need to Include Music Videos in Their Marketing Mix."Marketing Week. Centaur Communications Ltd, 24 Aug. 2015. Web. 22 Feb. 2016. <https://www.marketingweek.com/2015/08/24/why-brands-need-to-include-music-videos-in-their-marketing-mix/>.

Kolowich, Lindsay. "From Ray-Bans to Reese's Pieces: 13 Unforgettable Examples of Product Placement." HubSpot Blog Homepage. HubSpot, 12 Nov. 2015. Web. 22 Feb. 2016. <http://blog.hubspot.com/marketing/product-placement-examples>.

"Mistake 27: Overlooking 10 Important Reasons Why Brands Do Product Placement."Hollywood Branded Blog. Hollywood Branded Inc., 1 Dec. 2015. Web. 22 Feb. 2016. <http://blog.hollywoodbranded.com/overlooking-10-important-reasons-why-brands-do-product-placement>.

Mullin, Sheppard. "Branded: Product Placement and Video Games." Law of the Level. Sheppard, Mullin, Richter & Hampton LLP, 19 June 2009. Web. 22 Feb. 2016. <http://www.lawofthelevel.com/2009/06/articles/advertisingmarketing/branded-product-placement-and-video-games/>.

Nathanson, Jon. "The Economics of Product Placements." Priceonomics. N.p., 4 Dec. 2013. Web. 22 Feb. 2016. <http://priceonomics.com/the-economics-of-product-placements/>.

Newman, Jason. "Old Videos, New Ads: Advertising's Shocking Next Frontier." Rolling Stone. N.p., 4 Nov. 2014. Web. 22 Feb. 2016. <http://www.rollingstone.com/music/features/old-videos-new-ads-advertisings-shocking-next-frontier-20141104>.

Works Cited O'Reilly, Terry. "Show Me The Money: The World of Product Placement." CBCRadio. CBC/Radio-Canada, 4 Aug. 2015. Web.

22 Feb. 2016. <http://www.cbc.ca/radio/undertheinfluence/show-me-the-money-the-world-of-product-placement-1.3046933>. Osborn, John R. "Vast Difference In Program & Ad Viewing Highlighted By Millennials Stats."Online VideoInsider. MediaPost

Communications, 20 Jan. 2016. Web. 22 Feb. 2016. <http://www.mediapost.com/publications/article/267133/vast-difference-in-program-ad-viewing-highlighte.html>.

Palmbeck, Joseph. "Product Placement Grows in Music Videos." The New York Times. N.p., 5 July 2009. Web. 22 Feb. 2016. <http://www.nytimes.com/2010/07/06/business/media/06adco.html?_r=0>.

Persaud, Christine. "TV Networks Eyeing New Commercial Formats for Fall Season." Digital Trends. N.p., 24 Aug. 2015. Web. 22 Feb. 2016. <http://www.digitaltrends.com/movies/networks-integrate-advertising-into-shows-late-night-empire/>.

"The Relationship Between Product Placement and the Performance of Movies: Can Brand Promotion in Films Help or Hurt Moviegoers’ Experience?" The Advertising Research Foundation. The Advertising Research Foundation, n.d. Web. 22 Feb. 2016. <http://thearf.org/5-cups/the-relationship-between-product-placement-and-the-performance-of-movies-can-brand-promotion-in-films-help-or-hurt-moviegoers-experience/>.

Robb, David (2004). Operation Hollywood: How the Pentagon Shapes and Censors the Movies. New York: Prometheus Books. pp. 180–182. ISBN 1-59102-182-0.

Sapienza, Ethan. "4 Reasons Why Product Placement Can Be Good for Indie Fil." Indiewire. N.p., 22 July 2015. Web. 22 Feb. 2016. <http://www.indiewire.com/article/4-reasons-why-product-placement-can-be-good-for-indie-film-20150722>.