Do Marketing Media Have Life Cycles? The Case of Product Placement in Movies

This article examines the economic worth of product placement in movies over a time span of 40 years (1968-2007). The authors find an inverted U-shaped relationship between the year of the movie release and the returns associated with product placements. In addition, a similar inverted U-shaped relationship characterizes the economic worth of tie-in campaigns associated with product placements. These findings are consistent with the habituation-tedium theory used to explain the inverted U-shaped pattern in response to novel advertisements and suggest that the same mechanism could be influencing the response to an entire marketing medium. Overall, the results reinforce the notion that marketers find it increasingly difficult to get their message across using traditional media and underscore the need for the marketing industry to reinvent itself when new tactics lose their luster. The authors conclude with a discussion of additional empirical regularities.