M.Sc.(Econ) Nadia Sabour

 

Product placement as a marketing communications tool in Finland

Doctoral research proposal

 

 

 

Introduction and background

To better understand the challenges that face marketing communications today, Belch and Belch (2001, vi) describe the state of advertising and promotion in the postmodern world as follows:

 

Nearly everyone in the modern world is influenced to some degree by advertising and other forms of promotion. Organizations in both the private and public sectors have learned that the ability to communicate effectively and efficiently with their target audiences is critical to their success. Consumers are finding it increasingly difficult to avoid the efforts of marketers, who are constantly searching for new ways to communicate with them. (...) Marketers are looking beyond the traditional media to find new and better ways to communicate with their customers. They no longer accept on faith the value of conventional advertising placed in traditional media. (...) They know they are operating in an environment where advertising messages are everywhere, consumers channel-surf past most commercials, and brands promoted in traditional ways often fail. New-age advertisers are redefining the notion of what an ad is and where it runs. Stealth messages are being woven into the culture and embedded into movies and TV shows or made into their own form of entertainment.

 

In this environment, where advertising messages are nearly everywhere, exists the problem of clutter, which is very important for advertisers to understand. Belch and Belch (2001, 195) define clutter as the quantity of advertising in a medium. They further state that marketers are increasingly concerned about clutter because the competition for consumers’ attention in different media is furious. According to them, the high amount of advertising results in consumers being annoyed and advertisements having difficulties of getting their messages through. Regardless, it is important to point out that clutter is a key issue but not the only major concern of advertisers and marketers.

 

For their part, Olney, Holbrook and Batra (see Gupta, Balasubramanian and Klassen 2000, 42) raise concerns over the fact that viewers avoid television advertisements by zipping and zapping. According to Belch and Belch (2001, 361), zipping is fast-forwarding through commercials when playing back a program recorded previously. In addition, they state that zapping occurs when commercials are being avoided by changing channels. In conjunction with Olney, Holbrook and Batra, Lawrence (see Gupta et al. 2000, 42) emphasizes facts such as passive viewers avoiding television advertisements and television audiences being increasingly fragmented. In the same vein, Alwitt and Prabhaker (see Gupta et al. 2000, 42) note that people appear to dislike advertising on television. To conclude, Gupta et al. (2000, 42) point out that the factors mentioned above force sponsors to find other media alternatives and non-traditional ways of communication, such as product placement.

 

According to Balasubramanian (1994, 29-31), product placement is a product message that has been paid for and tries to influence film or television audiences through the intentional and subtle placement of a branded product into a film or television program. In addition, he argues that product placements fall in the category of hybrid messages. In this regard he states that all influence attempts that have been paid for and are aimed at audiences for commercial purposes, but have non-commercial characteristics, are included in the category of hybrid messages. He further elaborates that due to the non-commercial character of hybrid messages, audience members will probably not realize that they are the objects of commercial influence attempts and/or deal with the content of the message the same way as with commercial messages. Accordingly, the effectiveness of hybrid messages lies in their creativity of combining the most important advantages (and avoiding the least wanted disadvantages) of advertising and publicity (see Figure 1).

 

 

		HYBRID MESSAGES

 

 

 

 

Sponsor not        Advantage: Perceived source not identified à (i.e., media) appears credible.

Sponsor         Disadvantage: Perceived source identified à (i.e., sponsor) viewed with skepticism.

     

 

 

 

 

 

 

 

 

Figure 1      Hybrid Messages Creatively Combine Advertising and Publicity Concepts

(Balasubramanian 1994, 30)

 

This doctoral research departs from the above described circumstances facing marketing communications efforts at present time. Product placement was chosen as a research topic because it is assumed, that as a marketing communications tool, it in fact presents companies and marketers interesting and effective ways to reach ever more saturated consumers. In addition, the context of this research is more specifically focused on Finland due to the lack of research concerning the Finnish situation of product placement activities.

 

Furthermore, there are some signs of interest among Finnish movie producers and corporations towards product placement in, for example, Finnish movies and television shows (see e.g., Snellman 2003). Therefore, before taking major steps, it is crucial to conduct more research to, first of all, find out more about the possibilities the practically non-existent Finnish product placement industry presents to interested companies. Secondly, it is important to conduct surveys regarding the viewpoints and opinions that Finnish consumers have towards product placement in different media, in order to better assess the effectiveness of such communications efforts.    

 

Research objectives

As already briefly mentioned above, this research project aims at exploring the possibilities product placement offers Finnish companies. The first part of this research focuses on product placement as a marketing communications tool. The function of this part is to serve as a theoretical framework for the entire research and to give an overview of the trends and dimensions of product placement as a phenomenon today.

 

The second part of this research, on the other hand, explores the product placement industry and activities specifically in the Finnish context. The main aim of this part is to assess the current situation of the product placement practice in Finland from the viewpoint of various professionals, who are in charge of handling these communications efforts one way or the other. Its function is also to find out about the concrete possibilities Finnish companies have in case they are interested in product placement activities.      

 

The third part of this research concentrates on the Finnish public, the consumers marketers are trying to influence with possible product placements. The aim is to find out the general opinions as well as perceptions and awareness of product placement practices. This kind of ”in advance knowledge” is considered crucial because the success of possible placements at least partly depends on the views and opinions of the targeted consumers.  

 

The last part of this research takes a wider perspective and approaches product placement practices from a cross-cultural point of view. The country to compare Finland with could be, for example, the United States, which is well-known for its extensive placement activities and well-developed placement industry. Apart from factors such as the expertise and experience in product placement, the US-comparison could be supported by such arguments that both countries reflect similar traits of the ”Western culture”, are economically strong and have highly sophisticated business practices. The contribution of this final part is related to the better understanding of product placement effectiveness and the possible variations this effectiveness may have from one culture to another.     

 

Summa summarum, the primary research question is the following: (1) what opportunities does product placement as a marketing communications tool present to Finnish companies? Other questions to answer are the following: (a) what are the trends and dimensions of product placement as a marketing communications tool?, (b) what is the current situation of the product placement industry in Finland and what possibilities do companies interested in its use have?, (c) how do Finnish consumers perceive product placement and what are their opinions of it? and (d) how effective is product placement among Finnish consumers and are there differences in this effectiveness in comparison to, for example, American consumers?

 

Research methodology

The first part of this research will be methodologically theoretical and concept-analytical in nature. It will consist of a wide literature review, which aims at presenting various aspects of the product placement practice.

The second part, on the other hand, will be carried out through interviews with Finnish professionals involved or interested in being involved in product placement activities, such as marketing executives of companies in various fields of business (e.g., Pekka Rantala and Jussi Tanninen from Nokia, Max Alfthan from Amer), producers of television shows (e.g., Sarita Harma and Jukka Raatikainen from MTV3), movies (e.g., Jussi Lepistö and Markus Selin from Solar Films) and possibly other media channels (e.g., video games, books) as well as media and communications agencies (e.g., Tomcom Marketing Communication Ltd) in charge of arranging placement opportunities.

 

The data collection for the third part will mainly consist of a consumer survey among the Finnish public (a sample representing all demographic groups) through which the opinions and awareness of product placement practices will be measured. Optionally, if appropriate, it is possible to conduct the survey only among specified target segments of some Finnish company.

 

For the final part the most appropriate method is an arranged, controlled viewing of material containing product placement (e.g., movies, television shows, games) complemented by a survey. The most reliable circumstances for a cross-cultural comparison can be achieved through sampling among the student population of each country. Although this kind of sampling has its limitations, it is regarded as suitable for ensuring that all the possible differences that are detected are in fact based on cultural differences because students seem to represent quite similar traits and behaviors from country to country.      

 

Research schedule

Fall 2003:            October-November: gathering and studying related literature

December: analyzing literature and preparing 1^st paper

Spring /                January-March: finishing 1^st paper and drawing conclusions

Summer 2004:     April: preparing 1^st paper for publication

May-June: conducting in-depth interviews with Finnish marketing executives, producers and media agents dealing with product placement to gather data for 2^nd paper

                            July: analyzing collected data and preparing 2^nd paper

Fall 2004:            August-October: finishing 2^nd paper and drawing conclusions

                            November: preparing 2^nd paper for publication

December-January: mailing consumer surveys to gather data for 3^rd paper

Spring /                February-March: coding and analyzing collected data statistically

Summer 2005:     April-June: preparing 3^rd paper

July: finishing 3^rd paper and drawing conclusions

Fall 2005:          August: preparing 3^rd paper for publication

                            September-October: arranging viewing of product placement material and student surveys in Finland and chosen other country to gather data for 4^th paper

November-December: coding and analyzing collected data statistically

Spring /                January-March: preparing 4^th paper

Summer 2006:     April: finishing 4^th paper and drawing conclusions

                            May: preparing 4^th paper for publication

June-September: writing overall research framework and drawing conclusions of separate research papers 

Fall 2006:                     October-December: fine-tuning research report, preparing it for publication and preparing for doctoral disputation 

Contribution and practical implications of results

As mentioned earlier in the introductory paragraph, product placement is a marketing communications tool, which allows marketers to avoid the potential pitfalls of traditional advertising, which include for example the increasing clutter in various media as well as consumer avoidance of direct commercial messages. Already this makes product placement a fascinating and worthwhile subject to study, but there are also other contributions this research project can offer Finnish companies.

 

First of all, this research provides insight into the trends and dimensions of product placement as an interesting communications tool for marketers to consider in their attempts to reach today’s saturated and marketing savvy consumers. It presents different aspects of this communication practice in order to assist companies in evaluating its possible advantages for their business success. 

 

Secondly, this research aims at assessing the Finnish product placement business and its potential, which provides interested marketers valuable knowledge on the current situation of the practice. This knowledge helps companies determine, whether product placement is in fact a source of competitive advantage in the Finnish market and developed enough to be seriously considered as a part of their marketing communications mix.     

 

Thirdly, this research provides an opportunity to get an understanding of how Finnish consumers conceive and regard product placement, whether it is considered acceptable, disregarded or disliked. This kind of understanding of the perceptions and opinions of the target market in regard to placements, is an integral, if not principal, part of marketers’ decisions on whether or not to use this particular marketing communications tool. 

 

Finally, through this research project, marketers have a possibility to gain knowledge on the effectiveness of product placement among Finnish consumers, or optionally among their target segments. In addition, they have an opportunity to get information regarding the possible differences in this effectiveness in comparison to, for example, American consumers. These are valuable contributions because they help marketers, on one hand, in deciding whether to use placements in their influence attempts aimed at Finnish audiences and, on the other hand, in deciding, whether similar or different placement efforts are needed in culturally different markets.

 

In general, from the point of view of Finnish companies, this research offers them imporant knowledge and know-how on how to expand their marketing communications mix beyond the more traditional and popular channel and message format choices. This research also highlights the importance of collaboration and cooperation when it comes to marketing communications efforts, because product placement presents fruitful tie-in promotion opportunities, which create synergy, for both companies as well as, for example, filmmakers. All the knowledge this research provides is likely to be of great value in gaining competitive advantage in the ever more competitive Finnish market.

 

Finally, to take a more societal perspective, this doctoral research provides an opportunity to critically evaluate the current and possibly predict the future situation of the integration or merger of culture and commerce in the Finnish society. As well as presenting the views of product placement practitioners, it also takes into account the consumers’ perspective in order to assess, whether the current trend of blending culture and marketing seems to be gaining popularity and acceptance in Finland.    

 

Budget

This research project, which will be carried out at the School of Business and Economics of the University of Jyväskylä is estimated to take three years and to be finished by the end of year 2006. Therefore, the funding sought is for three years, which in total is 44 000 euros. This consists of an annual personal scholarship of 14 000 euros (approximately 1167 euros per month) and a personal travel allowance of 2000 euros to be used for attending an international conference on marketing. All the funding sought for this research project is in the form of scholarships from various regional and business development funds (e.g., Jyväskylän kauppalaisseuran säätiö, Liikesivistysrahasto). None of the scholarship applications have been solved yet.

 

References

Balasubramanian, S. K. 1994. Beyond Advertising and Publicity: Hybrid Messages and

Public Policy Issues. Journal of Advertising XXIII (4), 29-46.

Belch, G. E. & Belch, M. A. 2001 (1990). Advertising and promotion: an integrated

marketing communications perspective. 5^th edition. New York: Irwin/McGraw-Hill.

Gupta, P. B., Balasubramanian S. K. & Klassen, M. L. 2000. Viewers’ Evaluations of Product Placements in Movies: Public Policy Issues and Managerial Implications. Journal of Current Issues and Research in Advertising 22 (2), 41-52.

Ljungberg, E. & Rodrigo, I. 2002. Produktplacering - ett sätt att kommunicera varumärkesidentitet? Linköpings universitet. Ekonomiska institutionen. D-uppsats.

Snellman, S. 2003. Markkinointisopimukset pönkittävät kotimaista elokuvaa. Helsingin Sanomat 2.2.2003.

Vinciguerra, S. 2002. La nouvelle pub: plus on voit, moins on la reconnaît. Le Courrier 23.11.2002.

Wirsum, A. 2002. Produkt-Placement im Rahmen der Marketingkommunikation. Freie Universität Berlin. Arbeitsbereich Wirtschafts- und Organisationspsychologie. Diplomarbeit.