LONDON: A majority of consumers in the UK would accept product placement if it supports free television content or cheaper pay-TV services, despite the fact many find it "annoying".

Deloitte, the consultancy, partnered with YouGov, the research firm, to gauge the opinions of 4,199 viewers, finding that two-thirds of the panel described product placement as "annoying".

But 72% were likely to watch programmes if brands paid to appear or not, compared with 5% that suggested they might avoid these shows.

The tight product placement restrictions currently enforced in the UK are set to be relaxed later in 2010.

According to the Deloitte/YouGov report, 81% of participants in the 18-24 year old demographic foresaw no change in their habits, falling to 70% among contributors at least 55 years of age.

Elsewhere, 60% of those polled stated this type of marketing was permissible if it ensured material remains free-to-air, or led to reduced prices on subscription-based alternatives.

Once again, 18-24 year olds displayed the most enthusiasm, on approximately 70%, sliding to around a quarter in the 55 year old-plus cohort.

"There already is a widespread pragmatic understanding of the trade-off between advertising, in all forms, and the funding of content," said Paul Lee, media director at Deloitte.

"Indeed if the economic outlook were to weaken, the public may even urge greater quantities of product placement, if this meant cheaper quality television."

Moreover, the existing scheme of "prop placement", which allows the use of "donated products" fitting a particular storyline, had prompted 41% of the sample to buy a featured item, climbing to 54% for 25-34 year olds.

Within the 60% of people that regularly watched TV and surfed the net at the same time, 45% said browsing e-commerce sites was one of their top three activities during simultaneous media consumption.

According to the Deloitte/YouGov analysis, product placement can be expected to generate returns in the "low tens of millions" in the first year, ultimately rising to over £100m ($154m; €121m).

But this could draw revenues away from other forms of TV income, like advertising and direct sponsorship.

Demonstrating ROI may also be problematic, with options including adding brands' website addresses to online versions of shows, or else proving that product placement has caused an increase in recall.

The European Union originally outlined proposals to reform the rules governing product placement in 2007, although many of its members have been slow to follow suit.

Data sourced from the Independent; additional content by Warc staff