Beyond exposure: The influence of user tasks and induced presence on product placement effectiveness in virtual environments

Despite the growing interest in 3D virtual environments as a marketing medium, a significant gap exists regarding the individual's processing of embedded advertising in these spaces. Drawing on information-processing theory, this paper examines how user tasks and the sense of presence affect the processing of product placement in 3D virtual environments. We employ a multimethod approach using electroencephalography and eye-tracking to measure different types of attention during advertising encoding, while self-reports are employed to investigate advertising storing and retrieval. Results indicate that free-browsing yields greater selective attention than goal-directed search, while higher induced presence leads to enhanced attentional vigilance. Additionally, we show that task type and induced presence indirectly influence advertising recall through the mediation of advertising encoding and storing. This work advances the theoretical understanding of product placement processing in 3D virtual environments. Managerial implications for brands and platforms are provided to enhance product placement effectiveness within virtual environments.