After decades of dubbing dialogue into the movies they send around the world, Hollywood studios have taken the next step: dubbing product placements.
Digital technology has made it easy and inexpensive to substitute one product plug for another in the domestic and overseas versions of the same movie. And it gives studios a new stream of revenue when they can sell product-placement rights not only in the U.S. but also overseas.
The practice actually dates back to a pioneering effort in the 1993 futuristic police drama "Demolition Man." Pepsico Inc. bought a major role for its Taco Bell brand in the U.S. release, which depicted the fast-food chain as a candlelight establishment and "the only restaurant to survive the franchise wars." But in the overseas version of "Demolition Man," the featured restaurant was Pizza Hut, another Pepsico brand. Both Taco Bell and Pizza Hut now are units of Yum! Brands Inc.
Studios used to sell product-placement rights just once, to advertisers interested mainly in U.S. exposure. The plugs in overseas versions were free. "Before the technology evolved, the product would show overseas anyway, because you couldn't morph it, couldn't remove it," says Gerald Johnson, vice president for marketing resources at Dr Pepper, owned by Cadbury Schweppes PLC.
Dr Pepper's logo appeared this past summer in the U.S. version of "Spider-Man 2" from Sony Corp.'s Sony Pictures, on the refrigerator in the pizza shop where the Tobey Maguire character, Peter Parker, works. Overseas, the logo on the refrigerator belonged to Mirinda, a fruit-flavored soft drink brand that Pepsico markets outside the U.S.
Cadbury negotiated with Sony only for the U.S. plug because all but a tiny fraction of its sales are in the U.S. When Sony couldn't interest Dr Pepper in an overseas plug, it offered the spot to Mirinda. The brand signed a sponsorship tie-in with the movie in some 60 countries, says Dick Detwiler, senior vice president at PepsiCo International.
With foreign markets contributing as much as 60% of the box-office take for most Hollywood pictures, the practice of tailoring product placements for international markets is taking off. In some cases, the dubbed plugs are a mainstay of a movie's global marketing campaign.
"If you can take a can in someone's hand and change that from one brand to another, it opens up a tremendous amount of revenues," says Marsha Levine, president of A List Entertainment Inc., of Beverly Hills, Calif., which reviews movie scripts to look for scenes that could include a product plug. "You have this amazing arena that's just beginning," she says. "The industry is going through a revolution."
Cadbury usually makes product-placement agreements 18 to 24 months before a film's release, Mr. Johnson says. "We talk about the concept, and the studio says, 'This is who we think about for the lead, and here's the plot, and here's the demographic for this type of movie, and that's why we think it would be good for your brand,'" he says.
Films have routinely featured product placement since at least 1982, when "E.T. The Extra-Terrestrial" sent sales of Reese's Pieces skyrocketing. (The candy's maker, Hershey Corp., says it didn't pay for the role.) Major studios set up units devoted to selling product-placement roles, sometimes directly to advertisers and sometimes through specialist agencies that concoct related promotions for advertisers, such as movie-themed contests or store displays. The studios decline to discuss how much advertisers pay for product-placement roles, but depending on the scope of the promotional tie-in, the price tag can range from about $500,000 up to several million dollars, marketers say.
The ability to dub in different plugs may give the studios additional marketing clout but some people decry the practice. "It's a sad phenomenon, part of the descent of movies into glorified infomercials," says Gary Ruskin, executive director of Commercial Alert, a Portland, Ore., watchdog on commercialization. "It's ad creep, and people are sick of being bombarded with ads every waking moment." Commercial Alert has long condemned product placements as deceptive, believing they should be clearly labeled as ads.
In Los Angeles, a Sony spokesman declined to comment on the company's product-placement policies.
It can cost from $10,000 to $90,000 to dub a logo into a short scene. The process has become simpler and cheaper over the years as more special-effects agencies offer dubbing services. As more movies are shot with digital cameras, instead of being filmed on conventional 35 mm film and then converted to a digital computer file, the cost is expected to go down still more, says Chris Taday, vice president of European promotions for Sony's Columbia TriStar Films. "There are big brands in Europe for which we want to use films as promotional tools, and we want to leverage that," Mr. Taday says.
In the 2003 Warner Bros. movie "Looney Tunes: Back in Action," Sprint Corp. bought only the U.S. product-placement rights because its wireless service isn't available outside the U.S., says Stephanie Kelly, a Sprint brand manager. In one scene, an executive at a board meeting says, "Gentlemen, check your phones." In the U.S., the camera then shows a close-up of the red Sprint logo on the cellphone. In the international release, it shows the orange square logo of Orange, a unit of France Telecom SA. A spokeswoman for Warner Bros., a unit of Time Warner Inc., declined to comment on details of its product-placement agreements.
For now, product dubbing is largely confined to still shots: Dubbed products are usually little more than props in the background, because dubbing a moving object, frame by frame, is complicated. "It's easy as long as a package of soap powder sits on a kitchen counter, but it's more complicated when a housewife picks it up, or someone passes in front of her and you see only a piece of it," says Norm Marshall, chief executive of NMA Entertainment & Marketing, Los Angeles. Eventually, movies could digitally alter the appearance of the same product for local markets, he adds. "Unilever may market the same soap product around the world, but the packaging and color may be different."
In Warner Bros.' "Scooby Doo 2: Monsters Unleashed" this year, Burger King Holdings Inc. purchased product-placement rights, including the "right of first refusal" for a global role, says Cindy Syracuse, Burger King's senior director for marketing and sponsorships. It decided on just the U.S. plug, tying in the movie role with a toy promotion at its U.S. restaurants. The fast-food chain looks for roles in as many as six movies a year, two aimed at adults and four aimed at children, Ms. Syracuse says.
Warner Bros. was free to sell an international plug in the slapstick detective caper to Yum! Brands' KFC chicken chain. The result? A Burger King burger and cup are featured in the domestic release of "Scooby-Doo 2," while a KFC chicken sandwich and cup play in the international versions. "It was an opportunity that presented itself and it made sense," says a spokesman for KFC's international operations.
To build international product-placement sales, a movie-marketing group called the L.A. Office in October hosted an international meeting of brand marketers called RoadShow Europe, designed to help spur overseas product placement and promotions. Some 350 brand marketers came to London to hear Hollywood studios talk about the U.S. films that will be hitting European movie screens over the next two to three years. LA Office has been holding events in Los Angeles for seven years.
"The U.S. has reached a healthy level for product placement and promotions, so a lot of people in the film industry are looking at international," says Mitch Litvak, the head of the L.A. Office. A word of caution: Some movie stars with approval rights over product endorsements can object to dubbing. "It's often easier when no stars are involved" in the scene in which the product-plug appears, Mr. Litvak adds.
In the 2003 picture "Charlie's Angels: Full Throttle," the detective character played by Lucy Liu sends a clandestinely snapped photograph via her cellphone to a fellow detective. When he examines the photo on his computer screen, the audience clearly sees the logo for U.S. cellphone operator Cingular Wireless.
But in the movie's international release, as well as in foreign DVD releases, viewers see the logo for T-Mobile, a unit of Germany's Deutsche Telekom AG. And in a rooftop fight scene, a billboard in the background is for Cingular in the U.S. and T-Mobile overseas. "We were trying to push picture-messaging in Europe, so it worked really well," says T-Mobile marketing executive Clara Pombo. T-Mobile ran radio promotions, contests and a DVD giveaway of the first "Charlie's Angels" film for some of its new customers in the U.K.
"Our biggest European markets are the U.K. and Germany," says Ms. Pombo. "Those are also the biggest [overseas] markets for the [U.S.] film studios. So the promotions work both ways."
Charles Goldsmith, The Wall Street Journal. December 6, 2004
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