Is Virtual Product Placement TV’s Latest Disruptor?

It's a new way to monetize content, but creators are wary

Companies such as Mirriad, Ryff and TripleLift are using virtual product placement. Photo Illustration: ChefBoyRG; Sources: Getty Images

For nearly a century, products have played a starring role in some of the most iconic films and TV shows of all time, from a Hershey’s chocolate bar in 1927’s Wings through the Eggo waffles in Stranger Things.

Throughout those decades, the product-placement process changed very little. Producers and ad agencies would strike a deal to integrate a brand into a script, and at the appropriate time someone would show up on set with a box of products and hand them to the prop master for use in a scene.

Now companies like Mirriad, Ryff and TripleLift are attempting to rewrite the rules of brand integration using virtual product placement.

Inserting brands digitally into video has several obvious advantages. It can be significantly cheaper and more flexible than physically handling each product. It could provide an additional revenue stream at a time when viewers are aggressively rejecting commercials and other interruptions to their video bingeing. And, as the technology progresses, TV branding opportunities may become a lot more like web advertising, with precise targeting and real-time bidding for placements.

But even in an industry as in love with hype as Hollywood, some insiders are skeptical that these digital upstarts can dramatically disrupt the $10 billion product-placement business.

When AI meets CGI

There are three forms of virtual product placement, says Ryff chief product officer Mark Turner. You can insert a product that isn’t in the original scene, remove one that is or change an existing product. In other words, you can add a box of Cheerios to an empty table in a breakfast scene, then swap in Froot Loops or a Dunkin’ doughnut. Or, if a brand no longer wants to be associated with a particular production or actor, the producers can digitally delete the image of that product from the scene.

In cases where a new product is inserted, AI-based software analyzes the scene, identifies spaces where a product could be placed without being obstructed and then inserts a 3D-rendered image into each frame. If the action returns to that scene later, the software remembers where the object was placed and can display it from different camera angles and with relevant light sources.

But getting everything right can be tricky, admits Turner.

“You have to calculate the geometry in each scene,” he says. “Where is the camera pointing? What is the angle of the table? If the lighting is slightly different or the translucency doesn’t look right, human perception will immediately tell you it’s fake.”

Last September, Ryff announced a partnership with the Endemol Shine Group, the Netherlands-based producers of reality TV shows like MasterChef and Big Brother. Here, the company is working directly on set, placing a physical reference object into each scene, which can be digitally swapped out later for other objects. Once the object has been rendered and the metadata collected, it’s easy to re-render the scene later with virtually anything, says Turner.

But Ryff is not the first company to digitally embed brands into scenes. Mirriad has already launched several in-video advertising campaigns, inserting digital billboards for clients like T-Mobile and SEAT into the backgrounds of TV shows in the U.S. and France, respectively.

“Companies like ours connect viewers with a brand’s product messaging in a scalable way that is so incredibly realistic that they would never perceive it was seamlessly inserted after production,” claims Stephan Beringer, CEO for the London-based Mirriad.

Brand ambition

Ryff’s ultimate ambition is much grander, says CEO Roy Taylor. It intends to use online game engines—which routinely crank out high-res images to millions of players at 90 frames per second—to render unique products in real time for streaming video viewers.

Today’s game engines have not yet crossed the uncanny valley into true photorealism, Taylor admits, but they’re edging ever closer. And when all you need is a cereal-box-size piece of screen real estate, nearly realistic may be good enough.

Even better: Such a system will be able to customize insertions based on each viewer’s demographic information, behavioral data and location. As you’re watching Supergirl, you may see Kara Danvers in a bar next to a bottle of Jack Daniel’s, while your teetotaler neighbor sees Evian water; for your cousin in Mexico City, it’s Patrón Tequila.

Once broadcasters are able to insert products into scenes in real time, it becomes possible to integrate brands programmatically, the way most web ads are delivered today. Advertisers could bid for the opportunity to have their brands appear inside a popular program as it’s being aired, and to target different audiences with products specific to each.

“We want to become the Google AdWords for moving images, where any advertiser can bid for each virtual product opportunity,” Taylor says.

It won’t be an easy lift. Such a system would need to instantly analyze the context and content of each scene, taking brand safety and exclusion requirements into account. You wouldn’t want to insert a tube of toothpaste in the living room, a bottle of wine in a bathroom, Coke and Pepsi in the same program or a box of condoms in a kids show, notes Taylor. The software would also need to understand which actors are in the scene and the endorsement agreements they may have with different brands.

Creative blocks

The ability to dynamically embed brands into scenes exists today, though not at scale, says Ari Lewine, chief strategy officer for TripleLift, whose product insertion technology was in alpha testing at publication time. What’s missing so far is buy-in from studios, show runners and other creators.

“The technology has gotten ahead of the business side,” Lewine admits. “Generally speaking, agreements between studios and networks preclude the network from augmenting the content in any way. We’re trying to bring all the stakeholders to the table to structure new agreements for this.”

As Hollywood’s merger mania continues, and content studios integrate with broadcast networks and technology providers, such agreements will become easier to obtain, he argues.

Taylor says Ryff already has agreements in place with rights-clearance and licensing houses such as Greenlight.

Still, longtime brand integration specialists are dubious.

Inserting random products into a scene won’t have much influence on consumers, argues Caressa Douglas, svp, global strategic partnerships at Branded Entertainment Network. Top integrators work closely with a show’s creators, she explains, making the product a relevant part of the plot. Think Tom Hanks’ Wilson volleyball in Cast Away, or Woody Harrelson’s epic quest for one last Twinkie in Zombieland.

“I haven’t heard one producer say they’re open to the idea of retroactively inserting a brand into their projects,” she says. “Why would brands pay for a passive moment in the background? They want the moments that are authentic, and so do producers and creators.”

(In response, Mirriad’s Beringer points to research by Kantar Millward Brown that shows significant lifts in brand awareness and consideration for T-Mobile following an in-video advertising campaign in the popular Univision crime drama La Piloto.)

In recent years, brand-integration campaigns have also become much more sophisticated than simply placing a product within arm’s reach of an A-list actor, notes Claudia Cahill, chief content officer for Omnicom Media Group’s Content Collective.

“It can’t just be something that happens at that moment in time,” she says. “It has to be an effort that’s built out across multiple initiatives.”

For example, the Content Collective worked with Ellen DeGeneres to create hidden camera skits, sending Neil Patrick Harris and Michael Bublé to purchase Bubly sparkling water at a local store. These were part of a larger campaign for Bubly featuring social platforms and digital extensions.

Still, in an era when producers are seeking new ways to fund content, an automated way to squeeze a few more dollars out of existing programs has an undeniable appeal.

“The cost of productions are going up, because there’s a bidding war for the best talent,” notes Lewine. “Meanwhile, the ways to monetize that talent are becoming more limited. You cannot continue to increase ad load and expect consumers to willingly tolerate it. There needs to be a consumer-friendly paradigm for the next generation of television content. That’s where this technology comes in.”

This story first appeared in the April 15, 2019, issue of Adweek magazine. Click here to subscribe.