Productplacement in movies or on television is a very good form of advertising, if you ask me. It can reach lots of people, you can decide your target audience by selecting the type of television programme or movie (more women than men will be reached when advertising in that new chick flick), movies can be watched over and over again, blockbusters are being watched by many people, etc.
For me the most important thing is that you don't notice the advertisements, otherwise you could get annoyed and you really want to avoid giving your brand a bad name. Also filmmakers have to be careful with which brand they put into their movies. If they want to make a timeless movie, but the product doesn't exist anymore, it could give the audience the feeling that the movie is very old.
Some movies are overwhelmed with productplacement and this really annoys me. I don't like to be sold to and I can speak for many others. As an example, I instantly think about the James Bond movies. A few years ago, I read an article about the collaboration between Heineken and James Bond, and yes, I still remember it today so their brand awareness actually worked out pretty well for me.
It was november 2012, when the new James Bond movie "Skyfall" was released. The movie brought up almost 550 million euros, and counting. A reason for its financial succes is that the production costs are mainly covered by advertisers. Which is smart because the James Bond movies are very popular and are being watched over and over again by people over the world, so if you advertise in one of these movies, you can be sure that your audience is big. But on the other side, you need to pay big money to get your brand into the movie. Heineken payed not less than 60 million euros to let James Bond change his vodka-martini for a dutch beer. A lot of criticism has come to this drastic change in Bond's taste. A beer certainly hasn't got the same class as a vodka-martini, and this makes the productplacement too obvious for me.
Productplacement has been around for years. For example the Reese's Pieces candies that are being used to become friends with E.T. and made me want to have the same candies while watching the movie. When I was that age, I didn't get annoyed that easily by brands on the screen in front of me. This can mean that children are more susceptible to advertising, but i'd rather think that we were just not used to productplacement yet and that's why it still worked. Nowadays productplacement is a common thing so we get aware of it more rapidly than we used to, and on top of that: we get annoyed more easily. Or at least I do.