I think product placement and good television can co-exist in cases where the product doesn't get in the way of the text. It should be a utility to further the story, first and foremost, or to add realism to the drama, not a way to insert commercials into the text. If it provides some of the latter, great for business, but the $$$ deal can't be put first, at least if companies don't want to annoy their audiences.
However, as I wrote about in my thesis work, the worst that can happen is visual combined with reference, unless it is done in an ironic way (and that only works in rare form, so marketers don't think you can just pull an out by being funny with the brand and then laughing all the way to the bank).
Implicit Contract
C3 Alum Alec Austin did a significant amount of work while he was here looking into the history of product placement and what makes product placement look particularly good or bad. For one of the internal studies for the Consortium, entitled Selling Creatively: Product Placement in the New Media Landscape, Alec writes about the long history of product placement in American television, the problem with industry and critics alike pretending as if product placement is new considering its central place on radio and in early television (i.e. the Texaco men, the origin of "soap operas," etc.), and the need for a more nuanced way to understand what successful product placement would look like.
Alec writes:
Effective product placement is as dependent on creative skill as it is on guaranteeing screen time for a brand or product--after all, if no one wants to watch the TV show or play the game which contains a placement, that placement has no value! [ . . . ] Effective product placement depends on understanding the implicit contract between audience and media provider. Providers who violate the implicit contract with blatantly commercial motives are cheating their audience, and an audience that feels it has been cheated will abandon you.
I'll get into this more in my subsequent post from my thesis work, but see more of Alec's work on the implicit contract over at C3 Principal Investigator Henry Jenkins' blog.
Reverse Product Placement
In his original piece that inspired this afternoon's posts, Grant McCracken wrote:
Now there is a weird sort of solution to product placement problem. We only need change the polarity. We need to use TV shows as laboratories for the creation of product and brand ideas which then may be exported to the world.
A couple of folks from the C3 community, Hill-Holliday's Ilya Vedrashko and Microsoft's David Edery, have written and spoken about this in the past as the concept of "reserve product placement," process through which brands from a fictional world are made available as products in the 'real world.'" Grant and I have discussed this in the past, and I do think there are many creative options for products and brands tested in a fictional world to become a good consumable in the "real world."
Back in January 2007, I wrote:
The idea of taking something out of a narrative world and making it available in the real world surrounded media marketing from the beginning. Wearing the clothes or buying the brands that one sees on screen or even reads in a book, as my colleague Ivan Askwith is fond of reminding everyone, stretches back to the work of Charles Dickens, and that desire to buy the brands of your favorite character is the drive behind product placement.But this particular process looks beyond traditional marketing practices and into finding products in the fictional world that are then made available outside that world. In terms of storytelling practices, I've written before about narrative elements of a story that then appear outside that story. That process is what has driven transmedia storytelling, whether we're talking about a novel from the narrative world that fans are then given the chance to read as an extension of the narrative, a music album organized on a fictional show that then launches as an actual album, an online newspaper or tabloid from a fictional world, a blog from a narrative, or a company Web site that exists as part of a story.
For more on the concept, see this BrandWeek article, as well as David Edery's writing on the subject for Harvard Business Review and Gamasutra.