Does Product Placement Work?

Brands are ready for their close-up.

Does seeing the latest model of the Corvette Stingray in “Transformers” or hearing the new Rihanna hit on the soundtrack of “Gossip Girl” motivate consumers to buy?

According to Myers Publishing, branded entertainment, including product placement, is one of the fastest-growing advertising media. In 2009, $9 billion will be spent in the space, growing 4% from the previous year and accounting for 4.5% of the total media share.

How much of the branded entertainment spending is for product placement is impossible to tell, but the latter probably accounts for a small percentage of the total.

Many consumers find product placements bothersome.

Less than one-third of Internet users in a fall 2008 GfK Roper survey thought product placements were “quite acceptable,” and 36% found them annoying. In contrast, 42% and 37% of respondents said TV commercials were acceptable and annoying, respectively.

In addition, a BIGresearch survey indicated product placements were not highly effective. The method worked best for grocery items (such as branded soft drinks), with nearly 15% of consumers believing such placements influenced their purchases, followed by electronics, apparel, home improvement and restaurants.

African-Americans, Hispanics and Asians tended to be more influenced by placements than whites.

Product placement can also be a double-edged sword.

“You don’t know what’s going to happen,” cautions Adam Erlebacher of PlaceVine, a brand integration service. “Maybe the hero drinks a branded soft drink in one scene, then it’s used as a murder weapon later.”

Seeing a product on the big (or small) screen might boost a brand’s image, or harm it, but either way it may not increase sales. Of course, you could say the same about seeing an ad.

For more information at http://www.emarketer.com