Product Placement Grows As Nets Worry About Glut

This fall, General Motors will be a charter sponsor of NBC's new Apprentice: Martha Stewart from producer Mark Burnett. GM officials will only say that the sponsorship involves its Buick division because the network and production company will be unveiling sponsor details this week. But it is companies like GM—which are willing to pony up $2 million per episode to have products embedded in TV shows like The Apprentice—that have driven product-integration spending into the billions. Now, TV networks, which reap most of the deal money, are trying to manage the category so their shows don't become wallpapered with brand-name packaged goods and other consumer items.In 2005, spending on TV product placements is projected to grow 30 percent to $2.4 billion, according to Stamford, Conn.-based research firm PQ Media. Roughly 75 percent of that will be spent on prime-time network TV shows. Between now and 2009, spending in the category will grow an estimated 18 percent annually to $4.2 billion, PQM projects. And while that figure is a fraction of overall TV spending—$54 billion in 2004, according to PricewaterhouseCoopers—the percentage growth rate is about three times that of traditional TV advertising for the same period. Those numbers suggest more advertisers are getting into the product-integration game, and that leaves the networks in a catch-22 situation as they try to balance their desire for much-needed new revenue streams that have the potential to dilute programs and turn off already elusive viewers. Ad agencies, for their part, recognize the dangers and are trying to manage the process in a way that prevents too many scenes saturated with TV personalities savoring their favorite beverage or driving their favorite car."There are 250 advertisers looking for a brand integration in ABC's Desperate Housewives," says Tim Spengler, evp, director national broadcast at Initiative. "They might pick three." It could be two, or it could be four—the broader point being that it will be limited because the network doesn't want to decrease the appeal of its hottest prime-time show.Dan Longest, svp, integrated marketing and promotion at ABC, confirms that point: "We don't want to kill the golden goose. We will do integrations that we think creatively make sense, but we also want to make sure we police against things that don't make sense and don't seem to naturally fit into the fabric of the show."But when it's done right, product integration moves goods off the shelf and out of the lot, which is why GM is a big believer. An integration on this season's Apprentice for the new Pontiac Solstice was linked to a Web site where viewers could pre-order the car, and sold an unprecedented 1,000 vehicles within an hour after the promotion. Along with The Apprentice this fall, GMC will launch a new integration effort for its Denali SUV (coordinated by Publicis Groupe's Planworks) in CBS' The Amazing Race and continue deals with ABC's Monday Night Football and CBS's CSI , among others. "We look for presence above and beyond the normal and traditional," said Steve Rosenblum, marketing director GMC. As product placement increases, it is becoming more complex, marketing executives say. Simply having a Coke can on the set may or may not drive sales—it's hard to measure the effect, says Lori Kotarski Nelson, evp at Omnicom's Davie-Brown Entertainment. "The scope of deals are increasing," she says. "Companies want more impact and are doing larger marketing efforts to support integrations." Case in point: Last week's episode of Queer Eye for the Straight Guy on Bravo featured a new Hewlett-Packard digital camera and printer. The episode centered on the Queer Eye lads helping someone tasked with signing up HP as the sponsor of a charity event. HP gadgets were featured throughout the telecast, with several mentions of Queer Eye's shopping site, which in turn linked to the HP site. Smaller brands have opportunities too. Bacardi's Grey Goose vodka (with an annual ad budget of $25 million, handled by KSL Media) last week launched its promotion campaign—with two-page ads in Condé Nast publications such as Vanity Fair—for an integration with the Sundance Channel in November that will include six one-hour shows jointly produced by the brand and the channel. The episodes will feature celebrities interviewing their mentors that will culminate with Sundance founder Robert Redford quizzing Paul Newman. And at the networks, programs are no longer the only integration venue, as evidenced by a recent Mazda kickoff. The carmaker struck a deal with NBC to have its new M5 brand featured in an on-air promotion for the new fall series My Name Is Earl. The tie-in is part of a broader launch campaign that excludes TV ads. Normally, program integrations require an ad commitment, but Mazda's deal did not require buying spots.Advertisers are finding new ways to expand already successful integration campaigns, said Brian Terkelsen, svp, director of entertainment marketing, Publicis' MediaVest. He cites Sears' deal with ABC's Extreme Makeover: Home Edition, which expanded this season by adding a 30-second unit on Monday mornings on ABC's Good Morning America that refers to the previous night's episode and Sears' involvement. Shari Cohen, co-president of Sears' agency MindShare, said the category will still grow because it's a great venue for showcasing big ideas. "What we've been challenged by our clients more so than ever is to deliver innovation."

Brand Marketing

Product Placement Grows As Nets Worry About Glut

Steve Mcclellan

About

Subscriptions

Events

Publications

WORK SMARTER - LEARN, GROW AND BE INSPIRED.

Subscribe today!

Steve Mcclellan