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Thesis

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Introduction 13<br />

1 Introduction<br />

An increasing number marketers have warned companies about the changing consumer<br />

responses to advertising. Interruption-based marketing models are claimed<br />

to soon become obsolete (Godin, 1999). Some go one step further in asserting that<br />

the traditional 30-second spot on television could die all together in its current form<br />

(Jaffe, 2005). Whether these claims will prove to be true remains yet to be seen: advertising<br />

spending in the US continues to grow year after year (Nanji, 2017). Drawing<br />

attention is no easy task due to the hundreds of messages consumers are confronted<br />

with on a daily basis (Foxall, Brown and Goldsmith, 1998) and their limited<br />

ability to handle large quantities of information (Miller, 1956).<br />

Yet the amount of alternative types of marketing approaches and tools are<br />

plenty, ranging from viral marketing to gaming or social media to name a few. This<br />

thesis will focus in particular on product placement (for definition, see chapter<br />

3.2.1) as a marketing practice. As a response to consumers increasingly skipping advertising<br />

breaks (Russell and Belch, 2005), advertisers are diverting their spending<br />

to this form of promotion: product placement spending in 2017 in the US only is<br />

estimated at $8.78 billion (PRWeb, 2018). With its legalization on the 1 st of June<br />

2011 in the Czech Republic, the product placement practice is still rather recent and<br />

therefore relevant for the Czech market (Kalista, 2011). This increased spending has<br />

also resulted in increases in sales across various product categories (Russell and<br />

Stern, 2006). In addition, product placements in successful films have a positive effect<br />

on stock prices (Wiles and Danielova, 2009). Qualitative advantages of product<br />

placement include its potential for specific targeting and heightened exposure frequency<br />

(Russell and Belch, 2005).<br />

Product placement as a marketing practice is, however, not new: it has been<br />

around since the beginning of the last century (Turner, 2004). However, research<br />

on the effects of product placement remains limited. This will be the focus of this<br />

thesis. In particular, the thesis wishes to determine the impact of this form of promotion<br />

on cognitive, affective and conative responses (Foxall, Brown and Goldsmith,<br />

1998). Which outcomes can be expected from product placement and how can marketers<br />

improve their product placement efforts?

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