Buying product placement? Options & prices, pros & cons

John Barnard, chairman of NMG Product Placement, on all you need to know about buying product placement…

Since 28 February tens of thousands of words have been written about the ‘new’ product placement market. Parvenus abound! All I’ve read leads me to think it is time some basic product placement markers were set out.

Assume that the brand’s communication strategy has been written and product placement has been chosen as a medium, then working with broad brush strokes there are eight ways you can get your brand embedded into mainstream entertainment:

• US Film – free prop supply and paid for
• UK Film – free prop supply and paid for
• US TV – free prop supply and paid for
• UK TV – free prop supply and paid for

First of all, let’s sweep away the American myth – NMG’s LA Associate estimates that 80% of all brands appearing in US film and TV do so by free prop supply, not paid for deals.

Why? It’s simply that paid for deals only really work for hero props – high involvement items such as cars, smartphones, fashion clothing and so on.

Secondly, you don’t need to go to Hollywood to get into blockbusters. This week, at NMG’s base Pinewood Studios, Tim Burton’s Dark Shadows (Johnny Depp, Eva Green, Michelle Pfeiffer) and Ridley Scott’s Prometheus (Noomi Rapace, Michael Fassbinder, Rafe Spall) are in production.

That doesn’t mean to say there are necessarily placement deals to be done, but if getting into Corrie doesn’t tick all the boxes, there are some stunning, big budget US$150 million+ international movies full of ‘A’ list stars which you can buy into, and at a price which compares favourably to UK commercial TV.

NMG’s LA Associate reports: “For a big international blockbuster with a strong on-screen integration, fees can be over one million dollars. For smaller films with ‘decent’ recognisable exposure, the fee could be as low as $15,000… typically, these are paid after the film’s US release and the on-screen exposure has been verified.”

The fees for paid TV placement tend to be lower than film placements, unless the TV placement runs through a complete season of a show (things like Coke and American Idol) – these deals are well into the millions.

For TV, there’s no such thing as a fixed price – each opportunity is handled individually. Often with the bigger projects, the on-screen exposure is also tied into an ad buy (either on the specific show or elsewhere on the network). That’s what brings the cost into the millions.

An example, without naming a brand, would be on a show that airs on the USA Channel… their scripted programming tends to have a shorter season (typically around 12 episodes), and for good inclusion in 3 of the 12, with no additional media buy, would cost about $25,000 total.

The US and UK free prop supply methodologies and costs are similar. The first US product placement agencies appeared in the 70s. In 1984 I negotiated and paid more than US$60,000 for a ‘knowhow’ transfer deal and imported the proven US techniques into the UK.

Client fees, then and now, in the US and UK tend to be around US$50,000 pa (£32,000)  per brand for an unlimited number of placements. Simple arithmetic says that if for an average client NMG delivers say, 40 placements, then the buy in price is about £800 each. Generally free prop supply with say, fmcg, delivers a payback of about 10 to 16 times fee, or £320,000 to £500,000.

Clearly, as with any marketing communication medium, the role of the product placement expert is to select the right channels, the right mix and use the right tools to get the job done for the client. Paid for placement on UK commercial TV is one of these eight available options.

Paid for product placement is not a new medium, it is only a different way to pay for brand exposure. It opens up the routes to tie in promotion and creative PR, though this can be constrained by Ofcom’s rules.

Free prop supply methodology remains the only way to access the BBC, where roughly 30% of the viewing audience is, and most placement agencies includes film placement as part of their package, all brands can participate even those prohibited by Ofcom, and spreads risk whilst promoting ubiquity.

If tie in promotion, celebrity endorsement, creative PR are important priorities then a paid for feature film placement should be high on the list for consideration.

Paid for placement in film, professionally negotiated, gives the brand complete access to scripts, the chance to enhance the brand’s integration and exclude competitive brands. There are no regulatory guidelines to comply with. Exposure guarantees mean you pay when the film is released.

Finally, the brand has time to plan and coordinate a multi level marketing support campaign… and, of course, the placement will also appear on commercial TV in due course!