Product Placement in Movies - Academy of Marketing

Product Placement in Movies: The Role of Prominence,
Brand Awareness, Prior Notification and Culture on Persuasiveness
CHAN Fong Yee, Fanny
Annex 13a, Kent Business School,
University of Kent, Canterbury,
Kent, UK, CT2 7PE
Tel.: (44) 07564002480 Fax: (44) 01227761187
Email: fyc2@kent.ac.uk
Supervisors: Dr. Dan Petrovici and Dr. Ben Lowe
Paper submitted to Academy of Marketing Doctoral Colloquium 2012. The document is a research
Abstract
proposal of a third year doctoral student.
In the age of media fragmentation and consumer sophistication, product placement has become
a favourable tactic for advertisers to increase brand awareness. It has been widely employed in movies
to target global audiences. However, its effect is still inconclusive and the way it has been processed is
seldom examined. This study explores how placement strategy (prominence), product characteristics
(brand awareness) and regulation (prior notification) influence the processing of product placement
which in turn affects brand persuasiveness. The moderating role of culture and the mediating role of
depth of processing are examined. The current study adopts a multimethodology approach which
includes three phases: 1). Thirty-two in-depth interviews to tap audiences’ understanding and
perceptions of product placement; 2). A content analysis of movies released in Hong Kong and the
UK in 2010 to map the prevalence of brand integration and to identify research stimuli to be used in
the subsequent phase; and 3). A 2 X 2 X 2 between-subject full factorial experimental study.
Preliminary results indicate both convergence and divergence of the two samples in the perception of
this emerging marketing communication strategy.
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Introduction
Product placement, as an important component of marketing communication, frequently
targets global audiences in the vehicles of movies, exported television programmes, music videos,
online games and etc. Every year billions and billions dollars are spent on placing brands in movies to
reach the global audience. According to PQ Media (2007), global product placement market
(including non-paid) grew by 24.2% and reached US$7.76 billion in 2006. In 2009, global branded
entertainment spending totalled US$54.58 billion and paid product placement is forecasted to grow at
accelerating rates (PQ Media 2010). Despite the fact that increasing budget is allocated to placing
brands in movies to reach global consumers, no studies attempt to examine the effectiveness of
product placement across national and cultural boundaries. It is believed that the practice has changed
from “relatively local and unsophisticated to one that is often global in scope and purpose” (Karrh,
Frith and Callison 2001, p.3). The current research explores to what extent culture impacts placement
effectiveness and also examines how placement strategy (prominence), product characteristics (brand
awareness) and regulation (prior notification) together determine the level of processing of product
placement which in turn affects brand persuasiveness. The inclusion of cultural dimensions here is
more of exploratory nature and has no intention to draw any rigorous cultural conclusions (Cadogan
2010). It is hoped to lay a foundation for future empirical work on the perception of product
placement across cultures which is currently absent in this field. In spite of a few exceptions, there is a
lack of theoretical framework to guide discussion on product placement effectiveness (Gregorio and
Sung 2010). This research intends to generate a comprehensive portrait of product placement in
movies and answer the following broad research question which has not been addressed before:
How do consumers across cultures process and evaluate product placement information
and how does it affect the persuasive effectiveness?
Research Aim and Objectives
This research aims to understand how consumers in the Eastern (HK) and Western (UK)
cultures are likely to perceive and evaluate product placement. It then explores what guides the
persuasive effect of the practice across cultures and the interaction between culture and different
placement variables. The current study moves a step further to investigate placement effect from
perception to persuasion by simultaneously considering two diverse cultures. It not only enriches
literature in the field but will also provide practical feedbacks to global marketers. The study aims to
answer the following broad research questions (and sub-questions):
RQ1: Do consumers in the two cultures exhibit different views towards the marketing practice
product placement?
a). How do they interpret product placement and how do they perceive the different
execution styles?
b). What are their regulatory concerns regarding product placement?
RQ2: Do consumers in the two cultures have different exposure to product placement in
movies?
a). How prevalent are brands appeared in the UK and HK movies?
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). What are the major characteristics of brands that appeared in the UK and HK
movies?
RQ3: What are the key determinants of the persuasive effect of product placement?
Literature Review
a). How does culture moderate the effect of prominence, brand awareness and prior
notification on placement persuasiveness?
b). Does depth of processing mediate the persuasive effect of product placement?
c). Are there any individual differences in the processing of placement information?
Previous literature of product placement can generally be grouped into five categories: analysis
of the nature of brand appearance in movies or television programmes (see Avery and Ferraro 2000;
La Ferle and Edwards 2006); empirical studies of the effectiveness of product placement, usually
restricted to a particular country and a particular consumer group (see d’Astous and Seguin 1999;
Russell 2002; Van Reijmersdal, Neijens and Smit 2007; Cowley and Barron 2008; Homer 2009;
Gregorio and Sung 2010); general discussion papers on the development and trends of product
placement and the possible research frameworks (see Balasubramanian, Karrh and Patwardhan 2006;
Hackley and Tiwsakul 2006; Taylor 2009); an examination of practitioners’ views (see Pardun and
McKee 2000; Karrh, McKee and Pardun 2003; Russell and Belch, 2005; Craig-Lees, Scott and Wong
2008; Smit, Van Reijmersdal and Neijens 2009); and cross-cultural comparison of the interpretation
and ethical acceptability of product placement, including a meta analysis (see Gould, Gupta and
Grabner-Kräuter 2000; Karrh, Frith and Callison 2001; McKechnie and Zhou 2003; Eisend 2009).
Two interesting issues were noted here. First, the effect of product placement is inconclusive and the
way product placement has been processed is seldom examined. Previous research has been focused
solely on manipulating execution factors, e.g. exposure frequency, prominence, modes of product
placement (visual, audio), etc. However, no study attempts to explore the fundamental issue that how
information in product placement is processed and its mediating role on the effectiveness. Second, the
field is predominated by research conducted in the US and almost all the comparison studies revealed
cross-cultural differences on acceptance and ethical concerns of product placement. It is anticipated
that culture could have moderated the effectiveness of product placement.
The moderating role of culture and the mediating role of depth of processing
One of the execution characteristics of product placement is prominence which is frequently
examined. Product placement differ from traditional advertising, its persuasive intent is more implicit.
However, brands placed prominently are more memorable. Perhaps prominence could be described as
a double-edge sword for product placement. d’Astous and Seguin (1999, p.905) claimed that
“obtrusiveness may not be a significant mediator of consumer evaluations”. This is indeed a valid
claim since different cultures may view obtrusiveness differently. Okazaki, Mueller and Taylor (2010)
demonstrate that consumers from an assertive and performance-oriented culture respond to
advertisements with soft- and hard-sell approaches differently. Likewise, Terlutter, Diehl and Mueller
(2010) found that respondents from an assertive culture evaluate print advertisements with assertive
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appeals less favourably. Similar results on the dimension performance orientation were found in Diehl,
Terlutter and Mueller’s (2008) study. It is likely that individuals with different cultural orientations
will respond differently to prominently placed brands.
Consumers’ attitude toward product placement of different product characteristic is seldom
explored in previous literature (Tiwsakul, Hackley and Szmigin 2005). McCarty (2004) pointed out
that it is important to investigate what type of product/brand could benefit more from product
placement. Respondents in McKechni and Zhou’s (2003) study reported that they are less likely to
notice a placed brand if they are not familiar with it. It is possible that a well-known brand will be
more persuasive than an unknown brand if placed in movies. Pae, Samiee and Tai (2002) suggested
that well-known brands with transformational appeals were more successful in assertive and
performance-oriented culture (such as HK). It is because well-established brands are synonymous
with excellence in performance and success. In other words, cultural orientation may moderate the
effect of brand awareness on perceived brand effectiveness.
Currently movie producers are not obligated to notify audience for any upcoming placed
brands in the movie. Recently, the EU is considering passing a law which requires movie producers to
announce product placements at the beginning of the movie (Eisend, 2009). Previous studies indicate
cultural differences with respect to regulating product placement. Viewers in an assertive culture, the
US, generally do not think that it should be banned or regulated by the government (Sung, Gregorio
and Jung 2009) whereas respondents from a less assertive culture, Singapore, agreed that the
government should regulate the use of branded products in movies (Karrh, Frith and Callison 2001).
Therefore it is believed that the two cultural dimensions “assertiveness” and “performance
orientation” identified by House, Hanges, Javidan, Dorfman and Gupta (2004) will moderate the
relationship between placement characteristics and placement effects.
Research in consumer behaviour and social psychology proposed that effortlessly evaluating
message arguments and product attributes is unlikely to happen (Petty and Cacioppo 1981). The
elaboration likelihood model (ELM) is widely used in previous literature to understand how
consumers process persuasive messages (Petty and Cacioppo 1986). When watching a movie, we are
less defensive and tend to be more receptive of the presented information (Tsai, Liang and Liu 2007).
Product placement in a stimuli-rich environment (movies) is less likely to attract defensive processing.
It is usually more embedded than traditional advertisement thus is harder to detect the persuasive
intent and activate one’s persuasion knowledge. However, a prominent, a priori notified placement or
a placement of an unknown brand may be more likely to draw audience’s attention towards it. Their
persuasion knowledge is triggered and may lead to extensive processing of the messages (Friestad and
Wright 1994; 1995). They may counterargue with the promotional content and are less likely to be
persuaded. Therefore it is also hypothesized that prominence, brand awareness and prior notification
lead to variations in placement processing which then mediate placement effectiveness.
Research Plan and Methodology
The UK and HK were chosen for comparison because they are two promising markets for
product placement. The ban of product placement on television has just been lifted in the UK. Product
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placement industry in HK is now rapidly expanded to the online medium (Eaton 2009). There is a
pressing need to understand how consumers in the two markets perceive and evaluate placed brands.
In addition, the two share very similar political, economic and social infrastructures but differ
considerably on the two dimensions of concern (assertiveness and performance orientation. The
research is divided into three phases:
Phase I: Exploratory interviews. Thirty two in-depth interviews were conducted to tap HK and UK
audiences’ general understanding and perceptions of product placement. Specifically the five aspects
were explored: (a) respondents’ movie consumption habit and their general understanding and
experience about product placement; (b) their perception of different execution styles of product
placement; (c) the effectiveness of product placement, (d) their views towards product placement and
advertising in general, and (e) their regulatory and ethical concerns of product placement. All the
interviews were conducted face to face and audio recorded. The interviews help to validate the
conceptual framework and refine the experimental design of the later phase.
Phase II: Content analysis. A content analysis of movies released in HK and the UK in 2010 with the
highest box-office hits each week was conducted. The analysis documents the movie types, the
frequency and execution of product placement. Both paid and non-paid placements were included
since it is hard to judge if the producer had received money from a brand or not. This also applies to
purposeful and non-purposeful placements because it is almost impossible to judge the intention of a
placement. The content analysis helps to map the prevalence of product placements that moviegoers in
the UK and HK were exposed to and also to identify the pool of research stimuli that could be used in
the next phase.
Phase III: Experimental Study. Based on the pool of research stimuli selected from the
second phase, a series of five-minute segments of movies was chosen and edited. All the research
stimuli identified were pretested with twenty consumers to make sure that the manipulations are valid.
Participants were invited to watch one of the video clips and respond to an online survey. A 2 (low vs.
high prominence) X 2 (unknown vs. well-known brands) X 2 (without vs. with prior notification)
between-subject full factorial experimental design was used. A sample size of 540 is targeted (with
270 UK and 270 HK participants). Two matched samples are intended so that direct comparisons of
the underlying mechanisms of product placement between Eastern and Western consumers can be
made which helps to confirm the stability of the model across cultures (Cadogan 2010).
Preliminary Findings from Exploratory Interviews and Content Analysis
Exploratory interviews indicate that both samples are heavy consumers of movies. They watch
movies every week and some even watch everyday. Watching movies online or from DVDs are more
and more popular among this young cohort. Preliminary results show both convergence and
divergence of the two samples in the perception of product placement.
Views towards advertising and product placement in general. The UK sample is relatively more
positive about advertising. They see advertising a part of the daily lives which is essential to sponsor
free programme services. HK audiences are comparatively less positive probably due to the fact that
they have been bombarded by abundant ads which exist almost everywhere. Some of them comment
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that ads are “exaggerating” and are particularly annoyed by ads/promotion about loans and slimming
care products. Few of them do not like advertising at all and express strong negative feelings.
Compare to traditional advertising, young consumers found the covert marketing
communication--product placement more acceptable. None of the UK respondents felt negative about
this practice and only two HK respondents are against it. Respondents regard it as a win-win practice
for movie producers and brand owners. It is a good/clever way for promoting products while at the
same time brings movie producers extra funding.
Product placement and brand familiarity. Obvious differences emerged between the UK and HK
consumers with respect to the type of brands that are suitable for placing in movies. The UK
respondents found that both unknown and well-known brands are suitable for product placement.
They believe that small brands can benefit even more because of extra publicity. However, HK
respondents found that well-known brands are more suitable for placement. They tend to associate the
placement of unknown brands with promotional intention.
Regulatory and ethical concerns regarding product placement. Both the UK and HK respondents
understood that film production needs financial support and do not find it ethically wrong that film
producers receiving money from brand owners. Divergence is found in the two samples regarding
prior notifying audience about product placement. UK audience generally are supportive towards prior
notification. It indicates that the film has permission to integrate the brands which are not used
randomly. It also reduces complaints from audience. HK respondents are against the practice and
regard it as another round of promotion. The prior notification looks like reminding them that the film
is promoting something. The selling intention becomes so obvious. Few of them reported that they
may even consciously locate the brands in the movie. They believe prior notification would not
change anything because audience will be exposed to the brands regardless of being notified or not.
Prevalence of brands in UK and HK movies. The table below details the characteristics of brand
appearance in movies released in the UK and HK with highest box-office-hit each week in 2010.
Surprisingly, more brand appearances were recorded in movies released in the UK than in HK (277 vs.
180 brands). The HK sample contains slightly more well-known brands and a much higher percentage
of positively portrayed brands. A higher proportion of brands appeared in the UK sample is connected
to the plot and has character interaction.
Table 1. The prevalence of brands in movies released in the UK and HK in 2010.
Brand appearance characteristics UK HK
No. of movies analyzed 18+11* 18+11*
No. of brand appearance 242+35^ 145+35^
No. of brand appearance per movie 3~34 2~31
Most frequently appeared product category Durables Servicing/ retailing
% of well-known brands appeared 74.37% 78.33%
% of brands with character interaction 62.82% 46.11%
% of brands connect with the plot 37.55% 25.56%
% of positively portrayed brands 10.47% 21.11%
Note: *^ These figures belong to movies released in both countries.
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