The Future of Product Placement

Hamburg.
The first speaker at the Alcatel-Lucent Foundation / HBI conference is Marc Schwieger from advertising agency Scholz & Friends. He, too, picks up the product placement theme: products, of course, are everywhere in everyday life, too, so telling stories from real life is difficult without showing the products that are part of it. Some 49% of Germans find product placement annoying; this is less than the 63% who dislike conventional ads. Placed products are also recalled effectively - but do comparatively little to encourage users to buy those products.

So, covering real life requires covering the products which are part of it. Marc describes the James Bond movies as the mother of all product placements - on average, some 20 companies advertise in James Bond movies, and pay around $70m for the privilege. Product recall is particularly strong in blockbuster movies, and stronger for high-end than for everyday products.

Some companies - for example, Starbucks - rely on being continually present in big movies; apparently, they also have contracts with celebrities that require them to be seen with Starbucks products in their everyday life. And audiences tend to accept the need for product placement for example in order to support the movie industry - and if pressed, they prefer seeing real brands rather than fake brands to avoid product placement.

Further forms of product placement include the marketing of tourist destinations in movies and television, and the placement of products in music videos. However, again, many viewers are well aware of such practices, and can also take a cricial view.

Consumption is the expression fo democracy in capitalism, Marc says, and there's a permanent election now. So, he concludes, some 10% of production costs are likely to continue to be financed by product placement; there is no threat of an over-placement, as this would undermine audience ratings; and product placement is going to be the most important form of advertising in the future, since it will be users rather than broadcasters who will be come key distributors of content.

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