Consumers resist influence of covert marketing when paid placements are disclosed

Consumers remember and like products better after seeing covert marketing, such as a product placement in a sitcom, but reminding them that product placement is ''marketing'' eliminates the effect.

That's the finding of research by marketing professors Gina S. Mohr of Colorado State University, Margaret C Campbell of the University of Colorado, and Peeter W.J. Verlegh of the University of Amsterdam that was recently reported in the Journal of Consumer Psychology.

The researchers conducted three studies that showed not only that people remember and like brands much more after seeing a product placement, but also that disclosing the placement decreases its effects, especially when the disclosure occurs after the consumer is exposed to it.

''Frankly, we were a bit surprised at the power of covert marketing across a variety of studies,'' said Campbell, professor of marketing at the CU Leeds School of Business, who was the lead investigator on the study. ''Even though most US consumers know that marketers pay to surreptitiously get their brands in front of consumers, consumers are still influenced by covert marketing efforts. However, disclosures after the placement appear to alert people to the impact that covert marketing efforts can have, in which case they are less likely to be influenced.''

In one study, people watched a sitcom with a few-second exposure to a breakfast cereal. Later, when asked to list their favorite cereals, people who had seen a brand-name cereal during the sitcom were more than three times as likely to include that cereal in their top three, as compared to those who had seen a fictitious cereal. They also reported much higher liking for the brand.

However, when prior to watching the show, people saw a disclosure that the show included sponsored product placements, they were no more likely to list the brand in their top three, although they still reported higher liking for the brand.

When the disclosure appeared at the end of the sitcom, people were no more likely to include the brand as one of their top-of-mind brands, and they did not report higher attitudes for the brand compared to when they had not been exposed to the product placement.

There have been calls to require disclosure of covert marketing in the U.S. to be consistent with other requirements for disclosure of sponsorship. Other nations, such as Verlegh's home country of The Netherlands, already require some disclosure.

''In the US there has been some reluctance to incorporate disclosures for fear that it may interfere with creative content,'' said Mohr, assistant professor of marketing at Colorado State University. ''This research suggests that product placement disclosures need not occur at the time of product placement to be effective.''

The authors think that this research provides support for the idea that requiring disclosure after exposure to covert marketing would offer consumers information to help them choose how to navigate the marketplace. Consumers should get to know when they are being exposed to commercial persuasion, so that they can decide how they want to respond.