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Product placement has become increasingly more popular for television networks as traditional commercial advertising revenues continue to decline. If viewers are going to watch regular programming, the network might as well sell space in the program and thus force viewers to watch it, even if they don’t recognize it as marketing. Thus, product placements increased 8 percent in 2008.

The earliest product placements were not paid advertisements though; instead, Steven Spielberg famously had to get permission to use Reese’s Pieces in E.T. Even more recent product placement once seemed more subtle, such as when American Idol judges drank from Coca-Cola cups. In fact, American Idol has featured nearly 600 product placements.

But the latest version of product placement advertising works the items into the plots of television shows, so viewers cannot help but notice the product. On 30 Rock, Elisa and Jack discuss whether McDonald’s McFlurry is the best dessert in the world. On CBS’s Big Bang Theory, Penny works there, and Sheldon “needs access to the Cheesecake Factory walk-in freezer.” Contestants on The Biggest Loser must run from one Subway to the next. This placement packs a double-whammy: Viewers see the Subway brand but also perceive it as a healthy, weight-loss–oriented restaurant.

Such marketing may seem credible, because it appears to be coming from an objective third party, rather than the advertising brand. But the FTC is concerned about that appearance; the messages do indeed reflect the view of the brand that paid for the placement. Therefore, it wants the networks to run text onscreen when a paid product placement occurs, notifying viewers that the presence of the product is marketing communication.

Such a requirement likely would discourage advertisers from using product placement. For them, the main draw of this form of marketing is the subtlety with which it pushes their products. Programmers and viewers also might object, because a distracting legal disclosure could ruin the sense of immersion people often enjoy from televised entertainment. Alternatively, the disclosure might run at the end with the credits.

Discussion Questions:

  1. Why is product placement attractive to advertisers?
  2. As a viewer of TV programming, do you feel deceived because product placement is not currently disclosed to you?

Tom Lowry and Burt Helm, “Blasting Away at Product Placement,” BusinessWeek, October 15, 2009.