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Abstract:

While a mutually beneficial relationship between the advertiser and the producer is achieved via product placement, the best interests of the audience are neglected. Another concern this phenomenon has raised is the compromising of artistic merit for commercial gain. Conventional wisdom instructs us that high profits and elevated ethics don’t go together. Given the impressive profits made by the public relations industry (which promotes product placement), by implication ethics have been ignored. Although a framework of regulation exists in the United States, it has loopholes and suffers poor enforcement. Greater control of the practice of product placement can be achieved through a concerted effort from the public and policy makers.

Main Essay:

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”. (Russell & Belch, 2005, p.78) This vehicle could take the form of television, radio, video games, music records and even the written word.

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 more than $5 billion in size as of 2010, 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. There are also vocal calls for regulating this practice across media outlets. (Moorman, et.al., 2005, p.50). The rest of this essay will answer in the affirmative to whether such regulation is called for. Suitable scholarly citations are provided to support the claims.

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, 2007, p.140)

The bigger the industry, the more influential it is in affecting public opinion, consumption patterns and consumer behavior. Given such a pervasive nature of industry impact, it is all the more relevant that its business practices are scrutinized for fairness and ethics. The best way to do this is to study the regulatory framework within which the industry operates and the factors affecting regulations in the first place (Russell & Belch, 2005, p.78). The two primary decision makers in the industry are the placement agencies and content producers. To gain a better understanding of ERMA (Entertainment Resources and Marketing Association) in particular and the industry in general, a survey was conducted in 2007 by James Karrh and his team. This survey gives us a sense of where the industry is presently and what could be expected in years to come. One of the key areas of discussion is the blurring of distinction between a) content created for purposes of information dissemination and b) content created for purposes of persuasion. With respect to regulation, these two content categories in and of themselves does not invoke introspection and debate. Where regulations apply, quite rightly so, is in cases where ‘persuasion/propaganda’ is integrated into a facade of ‘information’. When this happens, what we see is an act of sophisticated deceit. Given the far-reaching implications of such a phenomenon comprehensive research is warranted. As a result, these days, research on product placement is extended to the study of “cognitive-response, attitudinal-formation, and involvement perspectives, etc.” (Moorman, et.al., 2005, p.50) Through an understanding of these aspects of product placement, appropriate strategies to regulate and control it can be devised.

Content that has the potential to reach a large audience (for example movies) is an attractive medium for brand promotion. The product-placement industry’s success is attributable to this “integrated marketing communication” approach. In the words of an industry analyst,

“the impact of product placements and other integrated marketing strategies can be conceptualized as a ‘consumption constellation’ whereby ‘symbolic interdependencies’ of products, brands, or activities come to signify or perform social roles for audience members who use or avoid these products as means of gaining status or avoiding stigmatization.” (Karrh, et.al., 2007, p.138)

Advertising agencies found this synergy a very attractive proposition. The members of the industry and their sponsors were determined to keep open these lucrative opportunities. This explains why no amount of regulation ever seems to bring desired results (especially in the United States). More importantly, for every bill that gets ratified in the Congress, many more don’t see the light of day (Katz, 1993, p.76).

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