US Product Placement Market Goes Electronic

18 May 2006

The increasingly encroachment of advertising into editorial territory in TV shows, movies, music and video games took a what could be a giant step forward with the launch this week of Embed - an eBay-style online marketplace for deals between media sellers and buyers.

Embed is the brainchild of Hamet Watt, chief executive of Los Angeles firm NextMedium; Hypes Hamet: "To date, product placement has been opportunistic and Rolodex-based. We're trying to create a real business. Our goal is to establish brand integration as an ad category."

Given the exponential fragmentation of media and the growth of techno-barriers such as TiVo, many media buyers see product placement as an increasingly attarctive way to reach consumers.

On the other side of the trading fence, content makers are eager to call-in the advertising dollars. One such firm, Reveille, which makes and distributes TV programs such as The Biggest Loser, Nashville Star and The Office, assigns an executive to each show specifically to ensure participating brands get full value for their money.

According to Nielsen Media Research, the number of broadcast product placements in primetime TV grew 30% year-on-year in 2005, while the time devoted to them inreased by 21%.

Embed aims to exploit this growing trend with what it claims is the first such online marketplace, enabling program producers to inform potential buyers what kinds of placement or sponsorship they are willing to permit.

They might, for example, allow products to appear as props or part of a character's wardrobe; to mention them in dialog or offered as giveaways in a gameshow.

However, the deals will be covert: "To feel organic, it can't be publicized that the brand paid for placement," says NextMedium's Watt. Which is not music to the ears of consumerist groups such as Commercial Alert.

"Undisclosed product placement is dishonest advertising," avers CA executive director Gary Ruskin. "We're trying to get Congress to pass legislation prohibiting undisclosed product placement."

Data sourced from USA Today Online; additional content by WARC staff