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If a network’s entire programming menu features commercial messages, it can be hard to work in traditional ads, so HSN, the Home Shopping Networking, does not broadcast traditional, 30-second commercials spots. To gain some advertising revenues though, it is turning to another key promotional method: product placement.

See Jamie Oliver, the chef and show host, making a pasta dish using Barilla pasta, with the brand displayed on screen. Oliver mentions that the pasta is multigrain and a great source of protein, fiber, and omega 3 that also tastes great. In exchange, HSN receives advertising revenue from Barilla.

Product placement can be effective for showcasing a brand when the consumer audience is already captive. That is, viewers have opted-in to watch the show, so they should be more open to seeing the brands during that program, compared with brands featured in commercial that interrupts their viewing. With the spread of DVR and similar technologies—half of allU.S.households that earn more than $125,000 use them—advertising rates have crashed. Advertisers do not want to pay for commercial time that no one sees. Simultaneously, product placement spending has increased by 19 percent to reach $3.46 billion in 2008.

Despite some concerns about the increasing product messages thrown at consumers during televised programs, HSN believes that these placements add to its programming, giving consumers suggestions about brands and products that they can use in their everyday lives.

Discussion Questions:

  1. Why is HSN adding product placements of brands into its programming?
  2. Are product placements on HSN different than those on other networks? If so, how?

Suzanne Vranica, “HSN Starts Mixing Ads Into Its Usual Sales Pitches,” The Wall Street Journal, September 28, 2009.

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