The New Age of Advertising: Brand Placement in Social Media

by Lily Gamble

       Advertisers have always been on the lookout for new and efficient ways to get their brands noticed, and with the increasing audience fragmentation caused by social media, companies found themselves searching for a way to bridge the gap between their consumers and the diminishing return their advertisements were bringing. From this, a new take on an old form of advertising emerged. While brand placement has been around for some time now, only in recent years has there been such an emphasis on it as a viable and innovative way for advertisers to expand their reach. This research focuses on the advancement in brand placement throughout social media, mainly that of YouTube, and explores recommendations for further research ideas.

Methodology

       Initially, a concentration on literary reviews found in a variety of databases was taken. After reading through each source, more data was acquired from the prospective social media outlets, which gave way to a deeper understanding as to why this type of advertising has become so popular amongst so many companies; however, there is a clear disconnect between the lack of research surrounding this topic and its vast expansion, so ideas will be discussed for future researchers.

Research

       Brand placement refers to the “paid inclusion of branded products or brand identifiers in mass media productions”[1]. With any brand or product placement, there must be a balance between blatant advertising and subtlety to ensure an audience is not completely deterred from a product. In a study published in the Journal of Electronic Commerce, it was found that in traditional product placement such as television or movie productions, “prominent placements are better recognized than more subtle placements, but at the same time may lead to negative effects on the attitude towards the placed brand”[1]. With the conflict of wanting to have as great an impact as possible for a brand placement without tarnishing a brand’s public image, the concept to feature celebrities in advertisement campaigns emerged. It was noted that this negative attitude was not as drastic when the celebrity endorsement was incorporated into a product placement [1]. There is no doubt behind the notion that having a well-known public figure endorsing a product or service adds validity to a sales pitch. There is a trust built up between these figures and their fans or audiences that allow for a more blatant endorsement to be made. In the same way, if a public figure were not necessarily as well-known as an award-winning celebrity, but still held the trust of a particular group of people, that figure could possibly hold the same ability to bring products to his or her audience and get paid to do so. It is understood that if a close, trusted person were to present an individual with a product, the individual would be more open to listening without becoming annoyed by the notion. In fact, the formerly mentioned study concluded that “this type of endorsement would just be considered positive word-of-mouth, regardless of the prominence of the placement”[1]. This ideology is what started the boost in brand placement in social media.

       Social media is defined by Merriam-Webster as “any form of electronic communication through which users create online communities to share information, ideas, personal messages, and other content.” Examples include Twitter, Tumblr, Instagram, Vine, YouTube, Facebook and SnapChat. Millions, and in some cases billions, of users are affiliated with these outlets and habitually log on to interact with friends, family and public figures. Each social media platform has unique services that are offered to its users. Twitter is a platform in which any of their 288 million monthly active users can send out updates on their lives in 140 characters or less, occasionally accompanied by a photograph [2]. Instagram allows its users, rounding out at about 300 million as of December 2014, to share moments of their lives through pictures and short videos [3]. YouTube, one of the most populated platforms with more than one billion users, is a place where anyone can upload any video on any topic to be viewed by anyone in the YouTube community so long as it abides by their community guidelines [4].

       With all the variety emerging amongst social media, however, audience fragmentation has greatly increased. Audience fragmentation is the division of audiences caused by the wide diversity of media outlets. Consumers can now split their free time between innumerable websites, applications and television programs, switching from their television, to their computer, and then to their mobile devices. This ever-evolving internet age raises the question of whether or not companies are putting their brand placements in the best place to most effectively gain recognition. There does seem to be one major benefit from this: by taking a look at the endless statistics surrounding the demographics that make up these social media outlets, brand placements can now be made to tailor directly to a specific group of individuals. Considering the sheer numbers of users constantly logging on to these websites and applications, advertisers have taken note of the seemingly endless possibilities. Each media outlet has its own set of statistics and research depicting their users. YouTube prides itself on the fact that advertisers can “select their target audience by gender, age, interest, and location,” keeping detailed reports on every demographic a brand could possibly brand place to [5]. A brand can look at the thousands of channels on YouTube that reach every single variant a consumer could fit under, but without the proper amount of subscribers, a brand placement would be insignificant if given to the wrong creator.

       To be subscribed to a YouTube channel individuals must be interested enough in what a YouTuber is creating to desire a notification be sent informing them each time said YouTuber has uploaded new videos onto their channel. With hundreds of channels having over one million subscribers—the top channel having over 35 million as of conducting this research—there is no wonder that “US product placement spending rose 10.2% to $4.26 billion in 2011”[6]. Companies can now send their product to these YouTube creators to include in their videos for adequate compensation. For instance, the popular YouTube creator Tyler Oakley, who currently has more than 6.6 million subscribers and 380 million overall views and who has interviewed notable public figures including Michelle Obama, frequently features Audible.com in his videos. Audible.com is a service that provides audio books to its consumers for an affordable price [7]. The exact figures for what Oakley receives in return for featuring this company are not public, but due to the Federal Trade Commission guidelines that require YouTubers to mention if their videos are sponsored or not, it is known that they are one of many companies that pay him to include their brand in his videos.

Conclusion

       Brands selling anything from hair care products to specialized services have taken advantage of this adapted brand placement advertising on social media. While the expansion of sponsorships have proven to be profitable for both parties involved, there is limited research surrounding the depths of its efficiency. Without the numbers to back up claims that social media is the best avenue for brands to gain recognition, a consensus cannot be reached. More research must be conducted looking into the quantitative benefits of brand placements compared to the more traditional ways including television and magazine advertisements. Also, whether or not there is a direct correlation to the amount of sponsored videos a YouTuber creates and the retention rates of their subscribers is still unknown. This goes back to finding the right balance between blatancy and subtly within advertising. While there is a clear disconnect between this developing field, the potential of it cannot be ignored. Brand placement in social media will without a doubt make way for the new age of advertising for years to come.


[1] Verhellen, Yann, Nathalie Dens, and Patrick De Pelsmacker. “Consumer Responses To Brands Placed In Youtube Movies: The Effect Of Prominence And Endorser Expertise.”Journal Of Electronic Commerce Research 14.4 (2013): 287. Supplemental Index.

[2] “About Twitter, Inc. | About.” About Twitter, Inc. | About. Twitter, 1 Jan. 2015.

[3] Quarter, During. “Twitter Still Doesn’t Have as Many Users as Instagram.” CNNMoney. Cable News Network, 5 Feb. 2015.

[4] “Statistics.” YouTube. YouTube.

[5] “Advertising Overview.” YouTube. YouTube.

[6] “Global Product Placement Spending Forecast 2012-2016.” Stamford, CT. PQ Media, 4 Dec. 2012.

[7] “Tyler Oakley.” YouTube. YouTube. Web. 1 Apr. 2015. 

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