The perks of product placement on Facebook

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The advertising world was stunned to hear Heineken's massive bar tab for placing a green bottle of beer in the hands of Daniel Craig (aka 007) in the most recent James Bond blockbuster "SkyFall." Heineken paid $45 million for the scene below and one other scene.

The perks of product placement on Facebook

While most brands would love to be associated with Bond, savvy marketers require demonstrable analysis and data mining to see if an investment really pays before they bet their career on a spend like that. In this article, I will answer the question really smart advertisers are asking: Is there a strong return for my brand in product placement?

Before delving into the detailed numbers and the surprising results of the data analysis behind "Skyfall," consider that return on investment in product placement has been challenging to measure since its inception. However, if done correctly, product placement can have direct attribution to increased sales. The largest product placement company in the world is also the most secretive. Apple reportedly (despite all corporate denial) pays over $300 million annually (in cash and products) for product placement and has the largest number of appearances in movies and television shows by far according to Brand Channel. It claims that Apple products appear in approximately 30 percent of all major motion pictures. Apple has certainly enjoyed robust sales, but there are more specific examples which show product placement provides a strong return.

One of the most famous: Sales of Reese's pieces surged 65 percent after ET ate the candy on the big screen. Clearly, product placement is pointless if it doesn't impact sales. In 2012 there were several well measured successful product placements that created a return on investment any CMO would boast about to the CEO. In the month following Mercedes' role in "Transformers: Dark of the Moon," sales of the model SLS AMG were up 14 percent. The year before that, sales of the Dodge Charger, the unquestionable star of "Fast Five," were up 227 percent according to Brand Channel. So without a doubt product placement can impact sales. But at what cost?

Heineken paid $45 million to replace the "shaken, not stirred" martini. If we look at total worldwide sales through February 2013 and use the average worldwide ticket price (according to boxofficemojo.com), here is what it costs to have 48 seconds in the middle of a two-and-a-half hour movie:

"Skyfall" gross sales: $1,108,000,000
Average ticket price: $8.05
Total viewers: 137,639,752
Cost per viewer: $0.33

This $0.33 per viewer does not take into account the intensity of the placement. Are people looking at the Heineken bottle, or the half-naked Bond? Or the girl in bed with him? Intensity of an impression is the biggest issue with TV advertising today -- TV intensity has dropped dramatically with the advent of digital video recorders (TiVo) where viewers can fast forward through commercials.

So paying $0.33 for every man, woman, and child in the "Skyfall" audience to see a Heineken bottle seems pretty expensive (especially given the estimate that almost 25 percent of viewers are not of legal drinking age). What are the alternatives for savvy brand marketers? The biggest accessible market today with significant influence is social media -- specifically, but not exclusively, Facebook.

 

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