1. Is Product Placement $aving the Music Industry? Eden Pearson Sean Leahy

2. Decreasing (Legal) Record Sales Article Summary How Much Does it Cost? Relation to Class Discussion What’s Next?

3. Decreasing (Legal) Record Sales Article Summary How Much Does it Cost? Relation to Class Discussion What’s Next?

4. Decreasing (Legal) Record Sales According to the Recording Industry Association of America (RIAA), global music piracy each year causes: – $12.5 billion of economic loss – 71,060 U.S. jobs lost – $2.7 billion in workers’ earnings lost – Over $800 billion in tax losses

5. Decreasing (Legal) Record Sales Article Summary How Much Does it Cost? Relation to Class Discussion What’s Next?

6. Article Summary: “Singing Songs of [Your Brand Here!]” Adam Kluger: Self-made budding music mogul He realized how much revenue the recording industry was losing in the new “digital age” The music-business trend that most caught his attention was product placement

7. 1999: “Summer Girls” – LFO“Summer Girls” – Abercrombie & Fitch 2002: “Pass the Courvoisier” – Busta Rhymes – Courvoiser cognac sales spiked after release – Brought attention to the value of “brand drops” for both recording artists and marketers alike Article Summary: “Singing Songs of [Your Brand Here!]”

8. Kluger made over 400 phone calls to record labels and large companies Finally sold them on the value of product- placement in song lyrics and music videos – First song: “Beautiful, Dirty, Rich” – Lady GagaBeautiful, Dirty, Rich – Also: “Zoosk Girl” – Flo Rida & T-PainZoosk Girl

9. Decreasing (Legal) Record Sales Article Summary How Much Does it Cost? Relation to Class Discussion What’s Next?

10. Costs: – $40,000-$250,000 per product placement – Varies based upon the artist’s popularity and relevance – Placing brand names in song lyrics can cost over $500,000 How much does it cost? Cost for product placement can more than cover the production cost for an entire video shoot

11. By Kluger’s own prediction: – “It will get to the point where the brand is paying for the entire production of an album,” explains Kluger. “The labels and artists will not have to put up any money. So everything is profit. That’s 2 years away, not 10.” How much does it cost? “Billionaire” – Travie McCoy Paid placement of Mini Cooper in 2010 music video

12. Decreasing (Legal) Record Sales Article Summary How Much Does it Cost? Relation to Class Discussion What’s Next?

13. Perception: – “The Clutter”: The average person is exposed to 3,500 ad info pieces per day, leading to a “sensory overload” – “Perceptual vigilance”: consumers are more likely to be aware of stimuli that relate to their current needs Learning & Memory – “Modeling”: imitating others’ behavior – “Memory”: acquiring information and storing it over time Relation to Class

14. Decreasing (Legal) Record Sales Article Summary How Much Does it Cost? Relation to Class Discussion What’s Next?

15. Can you think of any songs with products in the lyrics or videos? Do you think product placement in songs and music videos would make you more likely to purchase the product? Discussion

16. Helm, B. (2010, December 2). Singing songs of [your brand here]. Bloomberg Businessweek, 86-90. Pinchevsky, T. (2009). When bands and brands collide. Minyanville, Retrieved from http://www.minyanville.com/businessmarkets/articles/ AAPL-hpq-mot-MAT-F-dai/6/3/2009/id/22916 http://www.minyanville.com/businessmarkets/articles/ AAPL-hpq-mot-MAT-F-dai/6/3/2009/id/22916 Plambeck, J. (2010, July 5). Product placement grows in music videos. New York Times, Retrieved from http://www.nytimes.com/2010/07/06/business/media /06adco.html http://www.nytimes.com/2010/07/06/business/media /06adco.html References

17. Thank You