Summary

Master Thesis

Implicit Communication and Marketing:

Product Placement im TV unter Anwendung von
Erkenntnissen des Neuromarketing

Carsten Teubel

Master of Business Administration

Medienmanagement

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Implicit Communication - Product Placement - Neuromarketing Carsten Teubel

Summary

Targets:

The aim of this study is to show what according to neuromarketing should be

observed when implementing product placement measures in the TV area to
make a brand that has been placed unfold its full potential. As a basis it was cru-
cial in this context to present the current situation of the innovative product
placement mode of communication entertainment in Germany. This study con-
firms the importance, effectiveness and position and its special extensions in the
context of TV-PR and of branded of the product placement tool in the current
media landscape of television. The different forms of appearance presented in
the course of this study and their importance within the context of the medium of
television confirms the need for a differentiated way of viewing and using the in-
dividual communication tools. The general situation reflects the benefits expected
by companies which engage in advertising activities. Except for the internet, TV is
currently the leading medium in Germany. Attempts are constantly being made to
take advantage of this medium and influence production from outside in a tar-
geted manner. It is currently possible to find numerous examples of both positive
and negative placement activities on TV. On the one hand, TV broadcasts and
editorial programs are designed to ensure that a product is professionally in-
corporated into the context of the action in a way which is likely to increase sales
or else an image-promoting presence on TV is achieved by the supply of free
footage material.
On the other hand, cases in which a particular product, a particular logo, or a
particular brand is extensively blended and thus produces reactance on the part
of the consumer are to be found in practice. However, the method of placing pro-
ducts and logos, brands, or a particular issue at the focus of attention as often as
possible, as is usual in the case of traditional advertising formats, is proving to be
a fallacy of current decision recommendations. The tension is increased by tele-
vision producers and editorial teams on the transmission side.
Nevertheless, product placement, broadcast PR, and branded entertainment con-
tinue to be regarded as a sound source of finance when it comes to the produc-
tion of content for television. Because of rising production costs, there has been

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Implicit Communication - Product Placement - Neuromarketing Carsten Teubel

up until now a disproportional large number of placements. In the news arena,

this can among other things be attributed to the following state of affairs: as a
result of the archiving of supplied and previous company-produced footage ma-
terial which has been made available through agencies or production companies
within the context of broadcast PR activities, TV broadcasters have acquired a
huge stock of corporate branded content. The broadcasters use this again and
again for reasons of cost, even if it is particularly the case that public broadcast-
ers have to identify this “foreign material”. In practice, it is the case that prior to a
placement the parties involved have to clarify whether it is a matter of a permis-
sible, journalistically and dramaturgically justifiable placement activity.
However, there are limits to the continuing commercialisation of the medium of
television. The still not very highly developed planning and control tools are
shortcomings in the case of companies which engage in advertising activities.
The huge dispersion losses of product placement when it comes to the direct
addressing of target groups are viewed in a negative light by companies. The
development of IPTV and web TV to provide programs for particular sectors of
the population and special interest products for more precisely defined target
groups is a contrary trend. There is huge potential here. The question of whether
this trend is stagnating or increasing or the proponents of the “relevant set” are
right when it comes to television programs and the viewer or consumer only
wants to watch a handful of programs since he simply lacks information about the
choice of TV products available cannot and should not be definitively decided
here. The heated public discussion, the mentioned negative examples and
“scandals” aggravate efficient communication. With regard to hidden advertising
messages, the sensitization of TV-broadcasters and of viewers connected with it,
make the efficiency of product placement dwindle further. Under legal aspects, a
particularly thorough review by companies has to be conducted for the mentioned
reasons. The new Audiovisual Media Services Directive (AVMSD) of the end of
2007 has shed a little light on the grey area. With this, the correct path has been
taken to obtain more legal certainty on the issue. However, Germany has so far
not converted this EU Guideline into applicable national law. For this an amend-
ment of the Interstate Treaty on Broadcasting (RStV) is required. By the end of
2009, the legal passages concerned should be adapted.
Another substantial goal of this study is to show what the common communica-
tion theories are and in what way neuromarketing partially disproves them by new

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Implicit Communication - Product Placement - Neuromarketing Carsten Teubel

research. This new research should then be applicable in practice to product

placement measures as well. It was started with common communication funda-
mentals and theories with regard to the product placement effect.
As a vital perception, it became apparent that the attitude of the addressee plays
an important role for the effectiveness of messages. The way and manner of me-
dia utilization and the expectations the user exhibits vis-à-vis the medium, are to
be considered as qualitative criteria. The addressee adopts an active role in the
communication and thus decides for himself on its effect. The three main levels,
divided in cognitive, affective, and conative levels, were explained by means of
the various known stage models of the communication effect. Subsequently, the
course of the effects and effect components of communication were dealt with,
and the model of path effects was taken as its basis. It was possible to draw upon
this effect model for the effect of placement measures in that it showed that ad-
dressees - even in the stage of low involvement, for example while watching TV,
at a time when viewers themselves be lulled – can be influenced.
With the Elaboration-Likelihood-Model (ELM), it is to be generally shown how
addressees process persuasive communication. It was noted that central high
involvement and a peripheral low involvement exist. Through semantic networks,
it was shown how incoming messages are processed and linked “top-down” and
“bottom-up” from the knowledge of the relevant addressee. Today, the term in-
volvement has found a permanent place in discussions on advertising efforts.
That is why this term was dealt with in more detail and it was noted that it de-
scribes the measure of personal significance and importance which something
has to somebody. It was emphasized that the type of medium by which a mes-
sage is conveyed or transmitted is an important variable in the communication
process with TV being a variable in this case which is able to influence and even
create cultural values.
In order to be able to constantly approximate the effectiveness of product place-
ment, the unconscious processing of information was dealt with in more detail
and the interaction of associate initiation, effects of mere presentation, and im-
plicit memories were shown. In conclusion of the above, it should be kept in mind
that relevant brand concepts in the addressee’s memory are to be activated and
that their availability is to be improved by this interaction, that awareness could
be created by constant repetition and that from this more faith could be created.

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The more recent findings of neuromarketing followed later in the study which par-
tially disproved communication theories current until now. After a brief introduc-
tory description of the human brain, the development of neuromarketing, the
central role of the famous Coca-Cola-Pepsi study and the sub-disciplines of neu-
romarketing were dealt with in more detail. It was defined that the combination of
varying scientific disciplines such as artificial intelligence, marketing, market re-
search, cultural sciences, developmental psychology, brain research, and psy-
chophysics add up as the field of neuromarketing which, among other things,
attempts to explain human behaviour when making buying decisions, selecting
brands, or creating brand references. Then the major differences between the
explicit and implicit systems in the brain were addressed in order to make it clear
that the prevalent two-hemisphere model no longer applies. It was noted that the
claim, that emotion and ratio can be separated, is no longer valid since, accord-
ing to recent theories, no rational processes in the brain exist.
As a crucial new finding it was shown that the two systems, i.e. the implicit and
the explicit systems, differ greatly with regard to their processing capacity. The
explicit pilot functions with a deplorable 40 bits compared to an autopilot
equipped with about 11 million bits. Thus it is particularly important in brand
communication to reach the autopilot and address it since this is where relevancy
and brand messages that have been placed unfold their full effect and this with-
out explicit and thus conscious processing.
In addition, what it is that makes, prompts, or causes people to actually take ac-
tion after having received a message was discussed. After all, the image-
promoting behaviour of an addressee or, in the end, his purchasing activities, is
to follow product placement action. The “Zürcher Modell der sozialen Motiva-
tion/Zurich Model of Social Motivation” was presented to show the fundamentals
of human action and it was extended by conclusions drawn from marketing prac-
tice. This was schematically illustrated and recorded in the so-called “Limbic
Map”. The result was that the motives applied to the products and brands to be
placed have to be addressed. Those codes were identified as being the correct
signifiers of meaning and linked to the addressees that can be categorized into
language, history, symbols, and sensors. It was thereby stressed that non-
linguistic codes exert a special effect on the addressee because they are im-
plicitly processed by the powerful autopilot. After this it was outlined that the
understanding and the significance of these codes are based on learned cultural

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behaviour. In this way, inter- and intra-cultural differences were dealt with. In this
context, it must be borne in mind that, when using these codes, the same signals
and codes are interpreted differently in different cultures which means that no
symbol has the same meaning in different target groups.
In a further step it was substantiated that “significance” is created by “reward”
only. A fundamental classification of basic rewards into promotion and prevention
was made, and it was briefly dealt with the issue of “price” which can also imply
pain to a consumer and can be counteracted by preventive action, for example
by charging a brand with significance. Since the greater the significance of a
brand is, the lower a price seems to be in relation to it. However, as a counter-
measure it was shown that product placement can also contribute to enhancing
the significance of products and brands and to thus reducing the perception of
“price” pain. To supplement the analysis of motives and rewards it was likewise
demonstrated that they represent the two sides of the same coin since rewards
balance the motives should their account balance be in the red. This was outlined
in an exemplarily way and corroborated by showing that more is meant with re-
wards than to only satisfy elementary needs. Because the latter definitely have
an explicit effect and only rewards have an implicit effect. And it is imperative to
address the implicit memory, the autopilot.
Additionally, it was stressed that it is on the target group to decide which correct
explicit and implicit codes are to be chosen to address the motives. This was,
inter alia, substantiated by the classification of products into “state” and “trait”. By
means of the phenomenon of the so-called Halle Berry neuron, the message was
conveyed and explained that particularly strong brands have significance. Here it
remains to be noted as being important that brands, in addition to their formal
aspects, such as colour, primarily represent significance by their bracket as re-
gards content. It was clarified that the human brain primarily recognizes patterns
which can be used in the context of product placement measures. Additionally,
substantiation was provided for the fact that with regard to placement measures
for purely functional products and brands, an implicit facilitation for processing
can be created by the use of conspicuous packaging rich in contrast which pro-
vides a reward impulse.
Finally, four main signposts for the innovative implementation of product place-
ment measures were shown in the context of the transfer of practice, which were
to make clear what has to be particularly observed for practical implementation.

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A first essential signpost showed that the AIDA model is outdated and should no
longer be applied in practice. Terms like “impact”, “penetration”, “much helps a
lot”, and “assertiveness” of an advertising medium no longer support the pull ar-
gumentations in communications work. The push idea behind this should, if pos-
sible, no longer be pursued today. For this, the AIDA formula and its basic idea
were critically examined. It was, however, criticized that the individual AIDA effect
phases, which are sequentially and hierarchically arranged, do not always inevi-
tably follow each other like this in practice. Additionally, it was critically noted, that
much more importance has to be attached to the reward of the individual in order
to ultimately attract the attention of the addressee by the pull principle. The fol-
lowing formula was outlined as being more path-breaking and considered to be
good: Reward leads to attention! In another step it was noted that the Mere Ex-
posure Effect (MME) can be disproved today as well: the mere repeated presen-
tation of a brand or product does not necessarily lead to more positive impact
effects. As regards product placement measures it was elaborated that it is not
their task to arouse conscious attention to awaken interest in the viewer. As a
path-breaking rule, it remained to be noted: Less is more!
As a second signpost, it was noted that motives are never to be addressed di-
rectly. With regard to all product placement measures care should be taken to
always choose the way via the right codes in order to create the link to motives
which are anchored in the product to be placed in each individual case. In addi-
tion, it is of utmost importance to choose the indirect addressing of the motives
via these codes. In case of non-observance this would inevitably lead to effect-
resistance in the addressee. As a path-breaking rule, the following remained to
be noted: To address matters in a roundabout way!
The message of a third signpost purported that it is especially the non-linguistic
aspect in moving image media which is decisive to addressees. In this context, it
was particularly emphasized how important it is to precisely analyze the codes to
be applied in the run-up to implementation. By means of two practical examples,
the repressing effect of the non-linguistic as against linguistic codes was demon-
strated and how fatal the implicit acceptance of meaning by addressees can be.
As a path-breaking rule, the following had to be noted: Pay special attention to
the non-linguistic codes!
And finally, the fourth and last signpost showed how important it is to no longer
pursue the push idea but to prioritize the more recent pull perspective instead.

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The brain uses the pull principle and this and reward result in attention. Ulti-
mately, it is the addressee who finds the reward and not vice versa. For a clear
corroboration of this last signpost, the old push view was once again compared in
table form to the new pull view. As a path-breaking rule, the following remained to
be noted: Pull is what matters!

Conclusion:

Currently the entire corporate communications field is no longer solely based on

classical advertising activities such as sales promotion, PR, or media advertising.
There is an abundance of novel tools available which have been developed to
support the classical advertising instruments on the market. These are confronted
with a constantly weakening acceptance and effectiveness. Not only marketing
departments of companies increasingly rely on BTL activities. Sponsoring, mer-
chandising, and product placement are independent forms of communication that
constitute financing sources which are of special interest to the TV and film in-
dustry. Product Placement, TV-PR, and branded entertainment with its highly
effective forms of storytelling and/or storytising have long gained a solid foothold
in classical TV media work.
Nowadays, the viewers and addressees of messages deal with their media in a
much more educated and natural manner. For example, in order to be able to
evade the constantly growing and bothersome penetration of TV-advertising,
viewers even switch to alternative TV viewing techniques and pursue a more dif-
ferentiated TV consumption: with commercial-free pay-per-view (PPV) TV or the
optional use of personal video-recorders (PVR) with a time-shift function, viewers
avoid these commercials. With PVR, it is possible to view a television broadcast
or a film with a shift in time and thus rendered free from commercials. With regard
to classical TV advertising, it can no longer be spoken of as scattering losses but
in the extreme case it must be spoken of as non-target group members who have
never been reached. After all, the mostly weak originality of the majority of adver-
tising spots leads to a reaction on the part of the viewer, with the consequence
that less attention is paid to advertising spots.
On the contrary, with the integration of branded products, logos, or topics during
the plot of a film, a television broadcast, or individual editorial TV contributions,
the character of the advertising does not necessarily become apparent, but the

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product, the corporate logo, or the topic is still perceived. The reaction of the
viewer to advertising can thus partially be considerably minimized. Because of
the mentioned new technical solutions, which can simply “knock out” classical
communication instruments in advertising, and the advertising spots which are in
most cases inadequate with regard to creativity and entertainment value, innova-
tive and efficient forms of communication will be increasingly in demand in the
future. At any rate, this concerns the innovative measures of product placement
and its derivates, TV-PR and branded entertainment, even though their applica-
tion and use have come under heated discussion which is not yet resolved. As
has been determined by the technical press, a strict prohibition of product place-
ment would because of the extensive artistic, journalistic, and editorial freedom
not be enforceable. General regulations such as contained in the standards con-
cerning the separation of the advertising and the programming of the TV-
broadcasters under public law, cannot be enforced for private TV-broadcasters.
It has to be clearly stressed that because of the complex placement options and
determinants that exert influence, it is not the question of proposing or even pre-
scribing the method for action as the golden thread for companies which engage
in advertising activities. But if the premises of professional design and awareness
of the problems of reaction and its effects and primarily all the legal bases are
applied and observed, product placement, broadcast PR, and the form of
branded entertainment offer an efficient tool for guaranteeing and intensifying
communication success. However, in their application they do not constitute an
alternative action but are to be regarded, for the known reasons, as a supplement
and an intelligent support of other classical instruments. For these innovative
forms of communication, it will also in the future be right and make sense to say:
“As well as/ both.... and” instead of “either... or”.
With regard to classical advertising, attention has to be paid to the achievements
of neuromarketing especially for the innovative communication forms of product
placement and its derivates, TV-PR and/or branded entertainment. These can
and should be applied in parallel. In their parallel application, the following find-
ings are of major importance: The predominance of unconscious decision pro-
cesses and of emotions together with their structure of emotion systems. Addi-
tionally, attention has to be paid to general manipulation processes in the brain
and to emotional-cognitive manipulation processes of TV broadcasts, films, and
videos in the brain. It is also of importance to pay attention to language process-

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ing in the brain and the measures of neuro-scientific personality, sex and geron-
tology.
In conclusion for the practical application it is, among other things, also of utmost
importance to make use of the four signposts provided as a compass: Firstly,
attention has to be paid to the intensity of placements, i.e. “less” is “more” in most
cases and accordingly the idea of the AIDA formula has to be withdrawn and dis-
posed. Secondly, addressing the motives of the addressee, always has to take
place indirectly in a roundabout way, and it has to be worked with the right codes
so as not to directly address the motives of the addressee. Thirdly, importance
has to be especially attached to non-linguistic codes since these implicitly work
with the autopilot in the most sustained manner. Fourthly, work with the pull idea
and to reward addressees via brands that have been placed and their messages.
Consequentially, the motto of future communication measures should be: Create
innovation for media and brands using implicit communication and marketing!