June 19th, 2011

Over-the-Top Product Placements

The Street

Product placement is nothing new. For many years the makers of hit movies and TV shows have defrayed the cost of their productions by selling ad space in ways that can be either clever or blatant.

We expect to see James Bond in hot cars, wearing designer watches and single-handedly keeping the luxury industry afloat. We don’t mind that BMW and Tag Heuer paid big bucks to keep 007 saving the world in style.

It’s also hard to mind that the 1968 science fiction film 2001: A Space Odyssey, in predicting the future, made a bad guess on space travel giant Pan-Am that casts some doubt as to its prognostications. (The airline ended in 1991.)

It gets a little too obvious, though, when characters push their beer bottles into the frame as though handing us their chosen brew. Reality TV has upped the ante in the worst way: Whenever a cast member on MTV’s Real World or Jersey Shore opens a fridge, expect to see it jam-packed with Sun Drop, each can’s label facing outward so the camera gets a good look.

The movie Wayne’s World and TV show 30 Rock have even made sport of their placements—dutifully showing labels but nonetheless cracking wise ("Can we have our money now,” Tina Fey asks into the camera after a scripted boast for Verizon(VZ_) on her show).

Experts are aware it can get a little silly.

“The James Bond films were well known for their product placements to the point that, in 1996, there was so much in a particular movie that everybody made fun of it,” says Leo Kivijarv, vice president of research for PQ Media, a provider of media econometrics in Stamford, Conn. “In response, the James Bond franchise now limits product placement to only six per film, but because of that exclusivity they ask more per product placement. Everybody follows very closely who is the vodka dealer who got it for a particular film, which watchmaker and what automobile manufacturer.”

Product placement has proven an effective form of advertisement, though, especially in an age of TiVo, DVRs and online programming where viewers have the ability to “zap” past commercials, Kivijarv says.

As an indication of how much product placement is relied upon: Despite the recession, spending on consumer events and product placement in U.S. entertainment dipped only 1.3% in 2009, to $24.6 billion, and was on pace to grow 5.3% last year, exceeding most advertising and marketing segments. Specifically, product placement spending reached $3.8 billion last year.

Video game product placement is the one area where growth has slowed. Kivijarv says. There’s a lull while major players wait to refresh and update their consoles.

“Where we are seeing a big jump is with the music videos,” he says. “That goes to the general reason why product placement will continue to be a very hot commodity—because of changes in the media landscape, including an audience that is much more media focused than their parents were with analog.”

Reaching high school and college-aged kids is important. They avoid commercials, are more selective about what they watch and are not very brand loyal.

“They want to throw product placements into things like music videos because they they know they can reach this nonloyal younger audience,” Kivijarv says of advertisers. “A good example is beer. When they get to the age where they can start drinking, they are not loyal to a particular beer brand. So beer manufacturers try to reach them as much as they can on alternative media.”

Don’t expect the see the deluge of placements end anytime soon.

“Some of the investment in movies, especially from hedge funds, has just totally dried up in 2009 and 2010. Product placement now becomes one of the ways in which producers are able to recoup some of the money that they made in past years,” Kivijarv says. “Because fewer films are being made, the opportunities are more limited for the brands and agencies, so they may try to place products to the point that some are ridiculous. In some instances they might not even be in the film, but they have some sort of placement in advertising. I believe it was Volvo that became the official car of ‘Pirates of the Caribbean’ where there weren’t even any automobiles.”

The following are 10 examples of some of the most over-the-top product placements we’ve seen:

Read more: http://www.thestreet.com/story/11154849/1/10-most-over-the-top-product-placements.html

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