Before digital video recorders and other forms of zapping commercials began to reach critical mass, product placement was a cottage industry built on personal relationships. For a modest sum, a middleman would arrange for a sitcom character to sip a particular brand of soft drink, or for a cop-show chase scene to feature a certain make of car, in a favorable -- or at least neutral -- context.
Now, with more consumers sending 30-second spots to oblivion, the product-placement field itself has become one giant chase scene, complete with screeching collisions and general chaos. As marketers rush to embed their products in TV shows and movies, there is no agreement on how to create these promotional packages, how to charge for them or how to measure whether they are effective. The industry can't even agree who should represent marketers in these negotiations with TV and movie producers.
New players enter the contest every day: Talent agencies such as William Morris Agency Inc. and Creative Artists Agency Inc. are squaring off against the ad space-buying entities of the world's big advertising holding companies. Entertainment-marketing firms are dueling with public-relations firms. And more and more, the TV networks and movie studios themselves are putting together product-placement deals.
"Advertisers are being approached from many different directions," says Frances Page of Interpublic Group of Cos.' Magna Global Entertainment, which helped put together product-laden reality programs such as "The Restaurant."
Meantime, no universal standard exists for measuring whether a particular placement helps an advertiser's sales, market share or image. And conflicts between advertisers within a show, which seldom occurred in the old days, are beginning to pop up. "It's a little crazy," says Bill McOwen, a media buyer at Havas SA's MPG. "Everyone is fighting over the same space."
One person on the receiving end is Maria Feicht, director of brand excitement -- that's a real title -- for Allied Domecq PLC's Baskin-Robbins ice-cream chain. "I get pitched constantly," she says. "I think people have seen our brands in shows, so they think we will be open to partnerships."
It's not just reality shows that are strewn with products, but also some of TV's most blue-chip programs, including "Alias" on Walt Disney Co.'s ABC, "Smallville" on Time Warner Inc.'s WB and "24" on News Corp.'s Fox.
Movies are also seeing more product placement than ever as marketers increasingly look for new ways to cut through ad clutter and find new venues. Filmmakers, in fact, appreciate weaving real products into their scripts to heighten the level of realism, and studios, beset with huge marketing costs, are eager to enlist advertisers as promotional partners.
Baskin-Robbins, with the help of Norm Marshall & Associates Inc., a product-placement firm, did a large tie-in with DreamWorks SKG's "Shrek 2." In the animated movie, the green ogre and his bride-to-be drive through a town that has a Baskin-Robbins storefront. Out in the real world, the ice-cream retailer created three flavors -- "Fiona's Fairytale," "Puss In Boots Chocolate Mousse" and "Shrek's Swirl" -- named for characters in the film. The company supported the movie with two different 15-second ads and several in-store promotions that touted the new flavors.
FedEx Corp. recently got a plug in "I, Robot," the summer sci-fi film from News Corp.'s Twentieth Century Fox. The filmmakers inserted a FedEx delivery robot to add realism to the movie. The delivery company didn't pay for the plug and didn't promote the film. (Nike Corp.'s Converse also had an on-screen role in the movie, with star Will Smith's character sporting Chuck Taylor All Stars.)
These days, there's no telling who might be behind a product placement. William Morris helped the U.S. Treasury Department promote the redesigned $20 bill by getting writers on the CBS crime drama "CSI: Miami" to work the new currency into an episode. Elsewhere on the CBS schedule, a family on the sitcom "Yes, Dear" spent part of an episode last season munching on fries and guzzling soda from Wendy's International Inc. The plug was the handiwork of Ketchum Entertainment, part of a public-relations firm owned by Omnicom Group Inc.
Ketchum has more in store. This fall season, the firm is working with the costume designer on "Joey," on General Electric Co.'s NBC, to make sure the title character -- played, as on "Friends," by Matt LeBlanc -- will be sporting Levi Strauss & Co.'s Levi's jeans during the first few episodes.
Traditional ad agencies also have a hand in the game. In an episode of "High School Reunion 2," a WB reality show, Allied Domecq's Dunkin' Donuts made an eye-catching appearance. Awakened housemates drank coffee from their Dunkin' Donuts-branded coffee cups. Even the black coffee pot had a big Dunkin' Donuts label attached to it. "Mmm, delicious Dunkin' Donuts -- the breakfast of champions," said a cast member. The plug was the work of the doughnut maker's ad agency, Interpublic Group of Cos.' Hill Holliday, which agreed to have its client sponsor the show in return for having its brand embedded in the program.
None of this is to say that the 30-second spot is about to disappear. To keep buyers of these commercials in the fold, broadcasters in some cases are offering two-fers. Last month, Tyson Foods Inc.'s chicken nuggets received free airtime on CBS's soap opera "As the World Turns" after the company's media buyer -- Havas's MPG -- bought ads. During the show, two young boys cook and eat the nuggets.
As product placement expands, the potential for unforeseen conflicts expands along with it. Nowhere is that clearer than at Reality 24-7, a new cable channel devoted to reality programming that aims to be up and running by the first quarter of 2005. Getting certain programs on the channel is shaping up to be a strenuous challenge.
The problem is that reality shows are peppered with so many product placements that airing reruns -- and selling traditional ad spots to go with them -- can get tricky. The channel may have to digitally eliminate or block out products that appear in the shows and compete with advertisers' goods.
"It's uncharted territory," says Larry Namer, the network's president and chief executive.
Suzanne Vranica and Brian Steinberg, The Wall Street Journal. September 2, 2004.
Copyright © 2004 Dow Jones & Company, Inc.. All rights reserved.