Product placement set to soar

A US study predicts product placement - advertising embedded into television or movie plots - will more than triple during the next four years.

And local advertisers are also jumping on board as new technologies that let viewers skip commercials become more prevalent.

Paid "product placement" across all kinds of media - from TV to novels - surged nearly 39 per cent in 2005 to US$2.21 million ($3.5 billion) worldwide, and that figure was expected to grow to nearly US$7.6 billion in 2010, the study by research firm PQ Media said.

Deals in New Zealand for movie Sione's Wedding and animated television series bro'Town show back up the study's findings. About 10 per cent of production costs for the third season of bro'Town, set to hit screens in the next two months, was funded through sponsorship agreements, with brands such as Puma and Vodafone.

Producer Elizabeth Mitchell said signing sponsors was still difficult but some gave ongoing support.

"One of the characters, Mack, has kind of got quite a relationship with Masterfoods - he always eats yellow peanut M&M's," said Mitchell. "That just kind of happened at the beginning and we've built on that."

Sione's Wedding had paid placements from Vodafone and McDonald's worked into its plot. Paul Davis, an executive producer on the film, said product placements worked for only some projects and the key was smoothly integrating them. "It can backfire if it's too obtrusive."

Kevin Malloy, Australasian chairman of media agency Starcom, said the market for paid placements in NZ was maturing. It would "leapfrog" earlier models of blatant product placement.

"It's getting ourselves embedded in programming,," said Malloy. "Not in a gratuitous way that is going to have the audience turning off."

Malloy used the example of M&M's characters "interviewing" stars on an American entertainment show.

Consumer watchdog groups lament the growth of product placement, in which a brand name will literally be written into a storyline or a product will feature prominently in a scene, as it blurs boundaries between entertainment and advertising.

But despite suggestions that consumers will grow weary of blatant product references in their entertainment, advertisers are spending more on the tactic as devices such as digital video recorders allow viewers to skip traditional TV ads. Consumers are also spending more of their media time with commercial-free devices like the iPod music player or internet video.

The United States led global media markets in paid ad placements, which were worth US$1.5 billion ($2.3 billion) in 2005, PQ Media said.

- Additional reporting Reuters