A History of Product Placement in Movies: What, Where, and Why

Product placement in Hollywood is an interesting topic.

And we love movies here at Canny.

I remember a few years ago, product placement hit UK TV like a bat out of hell. The product placement P logo was everywhere. Now, I don’t see it so much. I wonder if perhaps it’s just expected?

As a business owner myself, product placement doesn’t annoy me anywhere near as much as it seems to annoy other people.

That said, I only tend to appreciate it if it’s done tastefully, or in complete jest, like during Wayne’s World:

Product placement has existed in Hollywood for an eternity. James Bond and Aston Martin are synonymous with each other. It’s not uncommon to see movies that tie in with products; even sporting events like the 2012 London Olympics had promotional tie-ins.

But what do companies seek to achieve through product placement or promotional crossover events?

Before we get to that, let’s look at some examples of product placement:

Product Placement in the Movies

As I’ve already said, product placement in movies isn’t exactly a new thing.

One of the earliest examples is the Buster Keaton/Fatty Arbuckle short film The Garage from 1920. The movie featured Red Crown Gasoline’s logo and at the time, was criticised by the newspaper Harrison’s Report.

And the trend grew and grew.

For a great history of product placement in movies, check out this article.

But, let’s take a look at some more famous and more recent examples:

James Bond

James Bond is famous for branding many different things, but let’s start with the biggest example of product placement in Bond movies:

Cars

Among spying, gadgetry, and all around crime stopping and world saving, James Bond is known for driving either an Aston Martin or a BMW.

Throughout his many years in film, Bond has famously driven top-of-the-range cars in nearly all of his movies.

In the early years, the Aston Martin was more prevalent. Then he stocked up on some German engineering before returning to the Aston in his latest movies.

Evans Halshaw have developed a brilliant website outlining Bond’s Cars over time. What’s your favourite?

Martini, Shaken, Not Stirred

Bond’s drink of choice. Can you order a Martini any other way?

For years, James Bond has ordered a vodka Martini. Whether he’s in a fancy casino or bar on a tropical island, this has been 007’s go-to drink.

But then came Skyfall, which contains a fantastic movie title sequence that we explored on the blog back when it was released.

In Skyfall, Heineken paid $45 million to replace the Vodka Martini as the spy’s drink of choice.

That’s a large slice of money to part with on what is practically a gamble. There’s literally no guarantee of return for the company.

Other Products Placed in Bond Movies

There has been a ton of product placement in James Bond films over time. The Telegraph have put together a list of 16 of the strangest and most imaginative product placements in 007 movies.

One product that would’ve had me leaping out of my seat to buy it is the Bell Textron Jetpack. Unfortunately, it doesn’t seem possible!

Is Bond Selling Out?

James Bond fans have criticised the movie franchise of “selling out.” Pierce Brosnan’s last film, Die Another Day, has been dubbed as Buy Another Day, for containing so many product advertisements.

In Die Another Day, twenty companies saw their products advertise on the big screen throughout the movie. Collectively, the companies paid $70m (£44m) for the privilege.

Concave Brand tracking put together this great study on brands present in modern day Bond Movies:

In the original Ian Fleming books, Bond did drive a Bentley. So it could be argued that he’s always been a man who likes his brands. And, if you were a well-paid secret service spy, wouldn’t you be zooming around in an Aston Martin? I’d certainly be dropping my Ford Fiesta, that’s for sure.

Maybe 007 should change his name to Brand, James Brand? (Sorry, I’ll get my coat!)

Does Product Placement Work in Bond Movies?

Well, it certainly generates the movie a boatload of cash. Normally, the income from product placement actually covers the cost it took to make the movie.

But, does this sort of product placement work from the brand’s perspective? Does replacing Vodka Martini with Heineken, or Aston Martin with BMW, actually make money for the companies involved?

According to Live Science, the jury’s still out on that one.

However, Heineken seem to think it makes a difference and are therefore willing to put up the money to ensure that James Bond keeps drinking the green bottled lager. And that’s all that matters.

E.T.

Rumour has it that Spielberg actually wanted M&M’s to feature in E.T, not Reese’s Pieces. However, Mars Inc., the company that owns M&M’s, apparently didn’t see the value of investing in the movie, so Hershey’s (owners of Reese’s Pieces) swept in.

Hershey’s agreed to spend $1 million on promoting E.T. for the ability to use the extra-terrestrial being in their advertising. It has been reported that Reese’s Pieces saw a 65% jump in profits only two weeks after the movie premier.

And as exampled above, Hershey’s were still using E.T to market Reese’s Pieces as recently as 2002.

Transformers

Just like the chicken and the egg, I’m not entirely sure what came first: the Transformers TV show and movies, or the toys and merchandise.

Before Michael Bay came along and exploded everything, Transformers was a line of Japanese transforming toys–the Autobots and the Decepticons.

From the beginning of the Transformers franchise in 1984 through the early cartoon TV show and to the recent Hollywood blockbusters, it seems that the films’ only job is to ship Transformers toys, and the toys’ job is to promote the movie. A self-serving marketing circle.

Then came Transformers 4: Age of Extinction, which essentially takes the cake for both the biggest pile of crap Transformers movie and most ridiculous product placement story in recent memory.

What happened?

Well, for all the talk about how many product placements were supposed to be in the movie, it appears that for the most part, they actually forgot to put a lot of the placements into the movie.

They’re now being sued for $27 million. Oops.

Toy Story

A movie about toys. It was always going to be a recipe for success for Pixar. The amount of money they made selling Buzz Lightyear toys alone would be enough to make even the richest blush.

I’m not sure whether manufacturers of the toys featured in Toy Story paid to have them there, but this article talks about the sales jump for the featured toys.

According to the article:

Etch-a-Sketch saw a 4500% boost. Slinkys were no longer being produced because they weren’t profitable. Post-Toy Story, Slinky received 20,000 orders, which revitalized the company. Mr. Potato Head sales jumped 800%.

That is product placement on an entirely different level. No huge brand names attached, but the products alone were enough to bring a company back from the dead and turn over huge sales orders.

Combine that with Woody, Buzz, and friends, and you can see why the Walt Disney cinema department went on to produce several sequels.

When I visited Walt Disney World at the back end of September 2016, I queued for over an hour in the boiling hot sun to meet Toy Story characters with my five-year-old son. I was his age when Toy Story came out. I’m 27 now, and 22 years on, the characters are as relevant as ever.

Back to the Future

Back to the Future II was released in the year I was born, 1989.

The movie features a pair of self-lacing trainers by Nike. These trainers (or sneakers for our American readers!) didn’t actually exist at the time the movie was produced.

However, director Robert Zemeckis and his team imagined a future with hover boards and these trainers, and as such, placed them into the movie. It’s interesting to think about what branding, web design and product placement will be like in 100 years from now!

Several years down the line, in 2015, Nike partnered with Marty McFly actor Michael J Fox’s charity to release a limited edition run of self-lacing trainers.

Whilst not technically product placement, it’s interesting to see that a product was brought to life because of Back to the Future’s cult following.

Other Examples

There are literally thousands of examples of product placement to go through–far too many for one blog post. There’s the Mini Coopers in the Italian Job, the Ray-Bans in Risky Business, Wilson in Castaway who actually becomes one of the main characters in the movie, and many, many more.

But:

Why Do Companies Use Product Placement as a Marketing Tactic?

The aim of the game for most of the companies that use movie product placements is to increase sales, obviously. However, there’s a lot more to it than that.

The immediate surge in sales is great for the brands involved in blockbuster films, but there are several moving parts at play.

For example:

Raising Brand Awareness and Creating Desire for Products

Obviously, not everyone is going to rush out and buy an Aston Martin after watching James Bond. It’s just not going to happen.

However, it does put Aston Martin firmly in the public eye. When Bond movies are released, there are huge marketing campaigns, big debates over the singer of the theme song, and of course, everyone wants to know who the Bond girls are and what car the man himself will be driving.

This raises brand awareness for Aston Martin, and being such a luxury, high ticket item, it creates desire.

I’m not a huge car fan. I have one, and it gets me from A to B. But when I see that Aston Martin roaring its way through the IMAX cinema screen, it creates a desire in me.

Then, if I’m driving along, or sitting in traffic, and I see an Aston Martin, it reawakens that feeling. It makes me think of Bond; it makes me think of that awesome engine roar and the exciting car chase.

Essentially, it makes me want to own an Aston Martin.

Reaching New Audiences

Cinema appeals to a wide range of people. In fact, I would go as far to say it appeals to nearly everyone.

And this huge demographic is great for advertisers.

Think about it:

You’re advertising a MacBook Pro in the film. Let’s look at the range of people that you could be reaching:

• Kids who would love their own laptop off Santa Claus
• Teenagers who want the slickest new gadgets to keep up with trends
• Young professionals who are looking for a super slick computer that impresses
• Older people who love how easy it looks to use

And that’s without thinking too hard about it.

Let’s look at a rather basic example of how this works.

Imagine this:

You’re taken along to the cinema by your partner to see a film in which you have little to no interest. It probably features Adam Sandler or Jennifer Aniston.

In the movie, after one of them has broken up with the other, they order an amazing-looking pizza; let’s pretend it’s from Domino’s. They wash it down with some Coca Cola and finish up with some Ben & Jerry’s ice cream.

The advertisers have got you right where they want you. You’ve not eaten, and food at the cinema is so expensive.

On the way home:

“Should we call in and grab a pizza?”

And on with the show …

There are so many people watching films every day; it gives brands and companies a way to tap into audiences that wouldn’t normally see their product.

Does Product Placement Work Better for Aspirational Brands?

Without facts and figures, it’s impossible to know.

However:

I do think product placement relies on creating a want, a need, and a desire. Therefore it’s probably safe to assume it works best for aspirational brands.

It makes you say “I want.”

I want to: own an Aston Martin, have an Omega Watch, wear those awesome Ray-Bans, travel First Class on American Airlines, work on a MacBook Pro and so on.

Sure, Domino’s Pizza, Coca-Cola, and Ben & Jerry’s may not be highly aspirational brands, but they do make you say “I want.” They trigger something in you on a subconscious level. It gives you “the hunger” for want of a better phrase.

What Effect Does Product Placement Have on the Movie Industry?

Product placement in the movie industry makes a huge difference. Some films simply wouldn’t have been made without advertising placements or sponsorships.

For smaller budget productions, securing one advertisement or brand product placement can help fund the entire production.

Even if you look at a huge blockbuster movie like Skyfall, you can see that the product placement fee paid by Heineken made up a significant chunk of the budget:

The budget for Skyfall is estimated to be between $150-200 million. Heineken’s $45 million made up quite a significant chunk of that production budget.

I’m not saying Bond wouldn’t have been made without Heineken’s investment, but having a quarter of your money back before it’s even released has to be good news.

Then factor in your other brand placements, and I bet Bond was close to being in profit before it even hit cinemas.

Does Product Placement Dilute Movies?

In short, it shouldn’t.

Done right, product placement would usually go unnoticed–not desirable from the advertisers perspective, but much more enjoyable from a viewer perspective.

Sometimes things drastically wrong:

We already touched on the Transformers failure a little earlier. But here’s something that just breaks my brain. The Transformers Mountain Dew Dispenser.

The Decepticon Dispenser transforms into a Mountain Dew vending machine and can kill people by shooting soda cans at them – an act that may give some viewers pause next time they walk by that new, innocent seeming office vending machine. – The Guardian

And again, there’s Buy Another Day (Die Another Day).

Then you have Will Smith in I, Robot’s infamous:

“Converse All Stars” line.

So blatant, and so disruptive to the viewing experience.

Like everything, there are good ways and bad ways to execute product placement. Some films do it surprisingly well, and others make a complete mess of it.

My favourite product placement movie is actually a movie all about product placement in movies. It’s from the genius that is Morgan Spurlock.

The Greatest Movie Ever Sold

Morgan Spurlock is best known for scoffing down McDonald’s food three times a day for a month. But one of his later films, 2011’s The Greatest Movie Ever Sold, is equally as entertaining and thought-provoking.

To give it its full title, The Greatest Movie Ever Sold is officially known as:

POM Wonderful Presents: The Greatest Movie Ever Sold

You can see where I’m going with this.

The Greatest Movie Ever Sold is a movie funded solely off the back of the product placement that Spurlock manages to secure throughout the movie.

Essentially, throughout the movie, he tours around the world trying to sell spots of the movie.

Top billing is bought by POM Wonderful, hence the full title of the name.

During the movie, Spurlock innocently visits a local convenience store and picks out Mane ‘n’ Tail shampoo. He talks about how silly it is, and its uses. They’re featured quite prominently.

Mane ‘n Tail is featured prominently in the film, but the film’s end titles disclose that they did not pay for the promotion. Instead, Mane ‘n’ Tail provided free products to be used in the production of the film. Many other brands only provided products or contributed to the promotion of the movie.

The film is about gathering product placements, how much they cost, and examining the effects that product placement has on the industry.

Spurlock manages to secure deals from companies such as JetBlue, Mini, Hyatt, Ted Baker, and more.

If you have any interest in branding, marketing, movies, or product placement, I can’t recommend this movie enough.

So, How Much Does Product Placement Cost?

As we’ve talked about already, product placement does not come cheap.

Heineken paid $45 million to be Bond’s drink in Skyfall. BMW paid $3 million to be the Bond car in Goldeneye. But they made $240 million in advance sales alone.

Product placement in movies is always going to cost a lot of money. Imagine how much it costs to make a movie; that’s essentially what you’re buying into and helping to finance.

Other examples and rough estimates on the price of product placement include:

• Disney was charging between $20k and $50k per placement, depending on the exact placement and usage, back in the late 80s.
• The Smurfs 2 managed to cover the entire cost of the movie’s production ($105 million) with $150 million worth of product placement deals.
• Hershey spent $1 million on their famous E.T placement, but that was back in 1982.

No matter which way you look at it, promoting your brand in movies is always going to be expensive. However, there is a different spin on product placement that is taking the marketing world by storm.

Social Influencers and Modern Product Placement

With the rise of famous YouTubers, Instagrammers, and other social stars, sponsored social product placement (aka influencer marketing) is becoming a huge deal.

And your business or brand can afford to do it, too!

You can find Instagrammers, YouTubers, bloggers, etc. who already have the following that you want and get them to promote it.

There are a few ways you can do this:

• If you already have a big social following, you can offer some sort of shout-out-for-shout-out-type arrangement.
• If not, you can send them your product free of charge, and hopefully, they’ll love it and agree to share it.
• Or, you can reach out to them and ask how much they charge to run promotions through their channel.

And the best thing about this marketing technique is that it doesn’t have to cost a lot of money.

There are plenty of people out there with 1000-5000 or 5000-10,000 followers across their social accounts. If they’re serving your target market, you can make a huge impact without spending mega bucks.

And that’s the direction product placement is heading in the 21st century.

So, does product placement work?

Scientists and statisticians have agreed that there is no clear-cut way to prove a correlation between product placement in movies and increased sales.

In the early 1900s, John Wanamaker said:

“Half the money I spend on advertising is wasted; the trouble is I don’t know which half.”

But surely, product placement in movies must work, or why would businesses bother to do it?

In recent years, movies and the cinema experience have become much more mainstream. With Netflix selling access to their library for around the £7 mark, watching movies now doesn’t cost a fortune.

So, more and more people are watching and being exposed to the brands involved. Naturally, that is likely to have a positive upswing on your bottom line.

But here’s something else to think about:

A lot of product placement is probably wasted when you consider the demographic of people watching movies.

Consider religion – something we don’t talk about here often on the Canny blog.

Muslims, for example, are probably a lot less susceptible to product placements for alcohol.

The huge diversity in background, ethnicity, religion and location in the world is making product placement a marketing strategy difficult for companies.

Like everything else, product placement should be tested and iterated upon. The issue there, however is you only get one chance to get it right, because once a movie is released, that’s it.

If you sign up to a franchise, perhaps you can correct mistakes as the franchise progresses, but for the most part, there’s not a lot you can do.

Again, though, it must work, or why would companies do it?

A History of Product Placement in Movies: What, Where and Why

Product placement isn’t going away. It’s infiltrated our TV, movies, and now our social streams, too. And to be honest, I’m not as opposed to it as some people are.

Well, except the Mountain Dew Deception. That was ridiculous.

Product placement can have huge benefits for brands, and if executed properly, can be an easy way to boost sales.

For me, product placement is a delicate art. It has to be done right.

Let me know your thoughts on product placement in the media. Or, if you’ve seen anything great or ridiculous I’ve not mentioned, let me know in the comments below!

Also, if you’re struggling for a good movie to watch this weekend, we’ve got two great posts to help out.

Check out our list of:

• The best movies about business and entrepreneurship.
• The best movies for marketers to inspire success.

Now, where’s my popcorn?