The place to be: insurers are beginning to participate in the merging of marketing and entertainment--product placement.

Once the marketing tool to sell soft drinks and potato chips, product placement is being recognized by insurers as a valuable way to promote their brands. As Reese's Pieces candy gained popularity from its placement in the blockbuster movie ET, Aflac hopes to expand its name with the appearance of its duck in the hit movie Lemony Snicket's A Series of Unfortunate Events. And on television, General Electric Co.'s spinoff Genworth Financial participated in the final episodes of the reality show, The Apprentice, to gain mega-consumer exposure for its new brand.

Consumer resistance to marketing is the root of product placement's growth. Marketing consultants trace the increased interest in product placement back to three studies of TiVo subscribers. The studies revealed TiVo users skipped or fast-forwarded through 60% to 80% of ads recorded on their units, said J. Walker Smith, president of the marketing consultant firm Yankelovich Partners. "People can control their exposure to advertising, and product placement is a response to this problem. You can't skip products in programming" Smith said.

Nielsen Media Research reports product placement in prime-time network TV shows continued to grow during the first nine months of 2004, with the Top 10 brands totaling 8,145 occurrences. Nielsen measures the occurrences by tracking how many times a brand is mentioned, how many seconds it appears, whether it is in the foreground or background and which character uses the item, said Anastasia Kerris, a spokeswoman for the researcher, iTVX, a firm that measures and tracks product-placement exposure, determined the NFL brand was plugged for 11 minutes during one episode of the ABC sitcom According to Jim, which was the equivalent of 50 30-second ads, according to an article in Broadcasting & Cable. With a 30-second ad rate of $200,000, the article states, the product placement was equal to buying $9.9 million of commercials.

Being associated with another brand's cachet is a benefit of product placement. Genworth chose to bask in the glow of the Trump brand when it signed on to lend its name to The Apprentice. Genworth was the sponsor of a charity event that was managed by the show's contestants as the final task to win a job in the Trump empire. Real estate mogul Donald Trump referred to Genworth as a leading financial-services company, while explaining the final task to the contestants. "One of our goals was to get the halo effect from association with other brands. An association with a brand like Trump is the acceleration of a brand you can't get from advertising," said Buzz Richmond, Genworth's senior vice president for brand marketing.

Aiming for Recognition

Last spring, the marketing team of newly formed Genworth Financial was brainstorming about the quickest and most effective way to get its brand to be recognizable in the eyes of the public."I wanted to get the name out there first. There's a lot of noise out there, and it's difficult to get the public to remember your name and understand the products you sell," Richmond said.

Since the demographics for The Apprentice aligned with Genworth's target market group--business-oriented people with an average income of $75,000--the company asked its ad agency, Klamath Communications, to approach NBC with the product-placement idea. Show producer Mark Burner agreed, and the episodes were shot in late June using six Genworth employees.

Genworth did pay for the product placement--Richmond wouldn't reveal the amount--but was happy with the exposure to the 30.4 million viewers that NBC reports watched all or some of the final episode. The company is conducting a study with consumers and with distributors to determine the company's brand recognition and attributes in light of The Apprentice exposure. Richmond said product placement is beneficial when establishing a new brand. "It was a good fit for us. We're not MetLife, Prudential or Allstate. We hope to be as well known as they are over the course of time"he said.

Another Step

Aflac's product placement made its iconic duck a movie star with its appearance during the holiday season in Lemony Snicket's A Series of Unfortunate Events, starring Jim Carrey and Meryl Streep. The appearance is part of an overhauling of the successful Aflac brand that company executives hope will explain what the company's products--life and disability insurance--can do for consumers.

Al Johnson, Aflac's second vice president of advertising and branding, said with 25 sponsorship, tie-in opportunities crossing his desk every day, it's important to analyze each offer to make sure it matches Aflac's marketing goals. So when the marketing company Bridge to Hollywood/Broadway approached Aflac in late 2003 about the movie deal--director Brad Silberling is a big fan of the duck--Aflac had other concerns. "We weren't sure it was the right fit. We didn't want it to come across as a blatant product placement, and we didn't want negative reaction to the duck," Johnson said. After negotiations with Silberling and a commitment to promote the movie, the scenes were shot in May 2004.

The movie is based on the best-selling children's book collection relating the lives of three orphans who suffer a series of tragedies after the untimely death of their wealthy parents. The duck is involved in one of the most intense scenes of the movie, in which the orphans are escaping a house being destroyed by a hurricane and come crashing onto a dock, which causes the Aflac duck to fall into the water. "The [plunge] adds comic relief to the scene,' Johnson said. The film debuted as No. 1 when it premiered in late December, taking in $30.1 million its opening weekend.

Marketing Multitasking 

The product-placement strategy was a success because Aflac used it as a business and marketing tool, Johnson said. The movie deal was parlayed into separate public relations, philanthropic and marketing strategies to extend Alfac's brand. Tickets to the movie's Hollywood premiere were used as a sales incentive to Aflac's sales force, and the proceeds from the post-premiere party were donated to Aflac's charity--pediatric cancer.

Aflac's film tie-in commercials were generated at a 90% cost savings to Aflac, since Paramount Pictures paid for production costs. Aflac made a media commitment of $5 million to Paramount, but that amount would have been spent for commercial time whether partnering with a movie studio or not, Johnson said. Paramount also was happy with the public relations buzz kicked up by the duck's appearance in the film. Looking back, Johnson considers the tie-in a success. "The duck didn't get any bad reviews by critics. So now we'll be looking for the next great marketing thing," said Johnson.

Top 10 Brands in
Product Placement *

Soft drinks top the list of brands
using television product placement.

                                            Total
                                        Number of
Brand                                  Occurrences

Coca-Cola Classic Reg. Soft Drink            2,245
Pepsi-Cola Reg. Soft Drink                   1,109
Nike Apparel                                 1,030
NetZero Internet Service Provider              907
Boston Red Sox Baseball Team                   804
Golden Nugget Hotel-Casino                     523
Ford Autos                                     413
Moosehead Beer                                 391
Chicago Bears Football Team                    364
AT&T Wireless Telephone Services               359

Total                                        8,145

* Jan.-Sept. 2004
Source: Nielsen Media Research

Key Points

* Insurers are discovering the value of product placement to promote their brands.

* Consumers can control their exposure to advertising, and marketers see product placement as an alternative to commercials.

* Product placement in prime-time network shows grew during the first nine months of 2004, with the top 10 brands totaling 8,145 occurences.

Learn More

Aflac

A.M. Best Company # 69824

Distribution: Independent agents

Genworth Financial

A.M. Best Company # 59197

Distribution: Primarily independent agents

For ratings and other financial strength information about these companies, visit www.ambest.com.