TV Product Placement Increases Sales for Cigarettes

A new study, “Show and Sell: Studying the Effects of Branded Cigarette Product Placement in TV Shows on Cigarette Sales” finds a 10% increase in TV product placement for cigarettes increase sales by 2% for the brand shown on-screen. It has the same effect on the brands direct competitors as well.

The study notes how tight regulations on promotional material for cigarette brands are, since smoking is seen as a public health problem. Cigarette brands cannot show TV ads, billboards or sports sponsorships. However, being featured on television is still allowed when shown in a series as a form of product placement, allowing the brands to be seen by millions of American television viewers.

“When people see product placement for a particular brand like Marlboro, retail sales of Marlboro products go up. However, what’s more surprising is that sales of other competitor cigarette brands also go up,” says Pradeep Chintagunta of the University of Chicago. “This indicates that product placement isn’t just about getting people to shift the brands of cigarettes they use – but to get people to smoke more overall.”

Researchers combined NielsenIQ PlaceViews data on product placement with NeisenIQ Ad Intel data, and measured the exposure on consumers to the sales of tobacco. “We find that this kind of product placement does increase the amount of cigarette sales. If regulators are interested in finding additional ways to reduce smoking rates, curtailing product placement for cigarette brands might be a fruitful option,” says Ali Goli, an assistant professor in the Foster School of Business at the University of Washington.

Chintagunta and Goli, who conducted the study with Simha Mummalaeni of the University of Washington and Sanjay Dharma of the University of Chicago are urging lawmakers to restructure the regulations around promotion of cigarettes brands based on the results of their study.

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