Saturday, February 11th, 2012
According to a McMaster University business professor, well-crafted movie product placements can boost a brand?s stock prices.
However, there is also the possibility of the opposite effect, says Anna Danielova, a finance professor from DeGroote School of Business. She says that when brands pick the wrong movie to integrate with, it could ?flog? their product.
Danielova and fellow academe member Michael Wiles?from Arizona State University?recently studied 126 product placements in 24 motion picture films that were released in 2002.
The selection of the movies had a strict criterion. First, the movie had to gross at least $20 million during their opening weekend and the product placement had to be visually or audibly evident to the audience.
The study is published in the current edition of Journal of Marketing. It found that brand stock prices rose by an average of 0.89 percent after a product placement in a blockbuster movie.
The boost also increased for higher grossing films, especially for products which were visually and verbally referenced, and for integrated product campaigns.
?The finance theory is recognition hypothesis,? said Danielova. ?So … someone sees a Coke in a movie and says, ?I do enjoy Coke, why not buy into it???
On the other hand, product placements in violent films affected stock prices in a negative way. Danielova cited Blade 2 as a prime example.
She concludes, ?Perhaps people think the company condones violence or there is a negative association with the product.?
Another observation was that critically acclaimed and artistically driven movies were not good product placement vehicles. Danielova believes that in these type of films, the audience does not expect product placements.
She describes how to find a successful product placement as: ??a very fine balance companies must find.?
Danielova cited examples of successful product placements, such as Pepsi in Austin Powers, Mini Cooper in The Italian Job, and Ford in Die Another Day.
She adds, a product placement ?has to be natural and suitable for the scene, characters and audience.?
Product placement is the next big trend to hit the advertising world. PQ Media says that it will be a $5.6 billion global industry next year. And if you tie a placement to an advertising deal, it?ll be worth $10 billion in value.
Source: TheSpec.com
