http://mediatel.co.uk/newsline/2013/05/17/why-george-osborne-is-good-for-product-placement/

http://mediatel.co.uk/newsline/2013/05/10/uk-product-placement-nmg-predictions-201314/

In February 2011 Ofcom permitted limited liberalisation of UK paid for product placement. This was probably the biggest shakeup in the product placement market since 1984 when NMG introduced formalised free prop provision to an unstructured marketplace.

So a little over 2 years since Ofcom’s changes where does NMG see market trends going?

Here are our predictions:

Prop Provision

Arguably the major investment by ITV and Sky with “roadshows” and high powered presentations to launch paid for product placement has educated marketers on the benefits of products in content faster and more thoroughly than independent placement agencies, with limited resources and access, could ever have managed.

At NMG we are seeing an increase in enquiries/new business from clients enthused by the benefits of product placement who had previously not considered this communications tool. However, they are looking at prop provision for its lower costs, wider exposure spread, managed risk and access to other TV channels as well as major movies.

NMG Predictions:

The prop provision market will grow as clients assess the benefits of free prop provision versus paid for.

The universe of placements will increase, fuelled by reducing production budgets, greater awareness and the increasing demand for quality content.

Agency Shakedown

There are about 12 independent product placement agencies that not only face the strictures of the six-year old recession but the additional demands that an increasingly educated market brings.

Smaller agencies will find it difficult, if not impossible, to deliver the service levels demanded by well informed clients and also by productions who often now expect products to be delivered same day.

NMG’s Chairman/Founder is a Fellow of the Institute of Chartered Accountants who ensures that we have a rock solid financial base and are fully resourced. NMG has made a profit in each and every one of its 29 years.

NMG Prediction:

NMG understands that one established agency has already closed its doors and we predict there will be more agency shakedown, maybe another two or three agencies will close or “merge”.

Ofcom Guidelines

These guidelines seek to avoid undue prominence, protect editorial integrity and brands/broadcasters using product placement as a “backdoor” route to gaining additional advertising secondage on screen.

So far, in the two-year period building experience and case studies has been vital for Commercial TV. However, NMG can foresee Ofcom being faced with viewer complaints that it will have to investigate. These can come from pressure groups but it is not impossible that competitive brands might instigate a complaint.

NMG Prediction:

Ofcom will be required to formally assess brand exposure against the guidelines. Given that fines for contravention can be large, ITV’s “This Morning” programme was fined £500,000 in 1994 for breaching similar guidelines, this will temper the paid for market.

Market Growth

NMG believes that whilst both prop provision and paid for product placement will grow, the real incremental market growth will come from movies. An increasing number of big movies are being shot in the UK. For example, NMG recently changed offices at Pinewood Studios to make room for Disney’s multi million $ move to Pinewood.

Latest global figures from PQ Media showed a 11.7% increase in 2012 in product placement spend with films like Great Gatsby 3D leading the charge.

http://www.brandchannel.com/home/post/2013/04/24/Product-Placement-On-The-Rise-042413.aspx

Movies offer global audiences, low or no upfront fees, editorial influence, regulation free and lead times to plan fully integrated PR and promotions.

NMG Prediction:

UK marketers, educated in part by UK commercial TV, whose brief falls outside of UK soaps, will increasingly consider UK and US movies as a dynamic solution.

J R Barnard 25 April 2013

 (see  http://www.televisual.com/blog-detail/The-UKs-top-40-film-production-companies_bid-356.html.)

Pinewood Studios based NMG Product Placement, works with  three out of four of these companies.  If we take out companies like Aardman Animations, home of Wallace and Gromit, and production houses producing period or films unsuitable for product placement due to content, it’s a virtual home run 100% success rate!

NMG’s 28 years in the film business means that our operating network and loyal following are second to none as the results show:

“The Results Show”

NMG’s Average Client Gains £6+ million Tracker™ Media Value

Introduction

Accountants KPMG’s latest study suggests an increasing and positive future for product placement in the UK.

(See: http://www.kpmg.com/uk/en/industry/media/product-placement/pages/default.aspx)
 
Pinewood Studios based NMG Product Placement believes that free prop supply product placement, (“free prop”), and paid for product placement, (“paid for”), are the same market – they both integrate brands into content – both have pros and cons – the only real difference between them is the way the deals are structured.

This article does not seek to compare these pros and cons in detail. For example, free prop can place any brand, except tobacco; paid for is strictly limited by Ofcom in the brands that are allowed.

Free prop works on the BBC; paid for is not allowed.

On the other hand paid for can tailor the date of the appearance; free prop has a more elastic timescale.

Free prop subtly places the brand in content; paid for has to be signalled by the “P” sign which can negate the value of the placement.

Commentators advocating paid for product placement always cite James Bond and American Idol and Coke as examples of best working practice, whilst overlooking that such guaranteed content and brand fit plus budgets in the $100m+ range are rare. In reality the norm is the Nationwide ATM in ITV’s Corrie, or Spontex cleaning materials on Sky’s Trollied.

Spontex on Sky

Nationwide on ITV

Spontex on Sky’s Trollied and Nationwide on ITV’s Corrie share the

brand limelight with free prop and other brands.
 

It is difficult to discover what fees have actually been paid for UK paid for deals. The euphemistic “six figure amount” is frequently mentioned, but what six figures?

Other reports suggest that paid for product placement deals are being offered to brands to sweeten the purchase of TV spot campaigns. Thus whilst the commercial TV industry was strident in pursuing Ofcom for rule changes to gain much needed incremental revenue, in reality are paid for deals cannibalising the TV spot spend?

What we can examine here, from NMG’s own data, is the Financial Efficiency of free prop product placement. Through almost three decades hands-on experience NMG Product Placement has created Tracker™; a unique database, which tracks and evaluates over 20,000 brand appearances on UK TV each year.

 
“Don’t let me be misunderstood”
 

Exponents of paid for product placement talk of a “new market”, “learning curves” and sideswipe free prop into a folksy momma and papa industry. A bit surprising since free prop product placement founded by NMG has been around since 1984, up to a hundred UK clients use it today and agencies like NMG operate using a sophisticated business model.

Free prop campaigns normally run on a 12 to 36 month period, with the Product Placement Agency undertaking to deliver as many on target placements as possible. Budgets, including cost of product and logistics, vary widely depending on the product itself – delivering a single pot of fresh yogurt onto a set in Liverpool, or a pristine car to Scotland, for example rack up costs. The selectiveness of the client’s brief can increase agency time in preventing negative appearances, excluding competitors and matching usage to the client’s strict marketing guidelines. Thus free prop total budgets, fee plus product cost, tend to run from about £30k to £140K pa. What can the client expect for that?

In free prop the most important dynamics in maximising results delivery are agency reputation and infrastructure, range of “must have” clients and an extensive operating network.

Far from the suggestions that free prop product placement is just about supplying products and hoping, NMG runs a sophisticated business operating inside the film and TV production industry.

Many production industry decision makers have dealt with NMG, and our sister company, Contemporary Props throughout their careers. Scripts are read, productions are contacted on a planned basis, sets visited and a “can do” team works daily hand in hand with their opposite numbers on the production.

A sophisticated logistics operation warehouses product, shops for short shelf life product or for specific production requests, and will deliver that single pot of yoghurt on set in Liverpool on time, or provide a smartphone ready to go, internet ready, with the character’s name and numbers already programmed in, or provide enough product and POS displays to dress a whole corner shop, supermarket or bar.

Finally, NMG operates Tracker™, the UK’s largest specialised database tracking and evaluating over 20,000 product appearances in content each year. Using Tracker™ Census  NMG clients receive comprehensive reporting and share of voice analysis so they can review their results, those of their competitors and plan this medium as they plan their other media activities.

 
The Results Show
 
This table summarises results delivered by NMG Product Placement. The data is averaged to preserve client confidentiality. The range column shows how individual clients results vary from this norm due to their brief, product attributes and range of brands included in their campaigns.
 

The above figures are based on UK TV first run only. An earlier NMG study with media experts Madigan Cluff and television tracking company ETS, identified that overseas broadcasts can double the UK Tracker™ media value.

 
See: http://www.newmediagroup.co.uk/?p=676
 
Money! Money! Money!
 

Due to lack of published data we cannot compare these results to paid for campaigns, but looking elsewhere we can make a broad brush order of magnitude comparison with other media. Thinkbox reported:

TV also delivers the most extra profit, Ebiquity found: an average return of £1.70 for every £1 invested (ROI of 1:1.7). This compares to £1.48 for radio, £1.40 for press, £1.06 for online static display, and £0.45 for outdoor advertising.

 
http://www.thinkbox.tv/server/show/ConWebDoc.3145
 
http://www.thinkbox.tv/server/show/nav.1818
 
Whilst we agree that product placement is not TV advertising, sometimes the results are more subtle, other times more powerful than advertising, with a product placement payback of around £1 invested yields around £60 ROI on the first broadcast, one can appreciate why the majority of NMG’s clients have continuously retained us since the 90s.
 
Conclusions.

• NMG believes that free prop and paid for product placement are in the same business only the deal structures vary.

• The overall product placement business will grow faster by free prop and paid product placement working together.

• Data sharing and transparency is the key to fuelling this growth.

Product placement is not a blunt communications tool. Knowing how and when to use free prop supply and paid for, or a mixture of both, and how much to invest, will lead to faster overall market growth and benefit all the players.

JRB 10 December 2012

John Barnard, FCA is chairman and founder of NMG Product Placement, which is based at Pinewood Studios. NMG founded the UK product placement industry in 1984, and commenced measuring product placement in 1987.

Each year NMG’s Tracker™ and Tracker™ Census records and evaluates over 20,000 separate brand appearances to the nearest second from more than 2000 hours of UK television and analyses them by 5 categories of saliency and further categorises into 300 product categories.

More than 80 leading brands retain NMG. Each year NMG delivers around 4000 on screen placements. John estimates that since the agency’s inception NMG has been responsible for more than 100,000 placements – so far.

 
For more information, visit www.newmediagroup.co.uk

NMG proactively places our clients in movies to gain international exposure, affiliation with high profile casts and potential opportunities for global promotion and entertainment marketing.

In February 2012 NMG celebrated brand placements in Oscar nominated movies ‘The Iron Lady’, which won two awards and three times nominated ‘Tinker Tailor, Soldier Spy.’ The secret to successful film placements is ‘thinking ahead’ by having the inside knowledge to know where the film opportunities will be long before the cameras begin to roll.

NMG’s blockbusters are easy to spot! As far ahead as 2014 we have Spielberg’s ‘Robopocalypse’, meanwhile ‘Thor 2’, ‘Kick Ass 2’, Danny Boyle’s ‘Trance’,’ Jack Ryan’, ‘Red 2’, ‘Maryland’ and ‘Dom Hemmingway’ are in production now. Indeed ‘Kick Ass 2’ and ‘Maryland’ are today being shot just beyond our office windows.

Pre-production can last from 6 months to 2 years, at the time of writing, NMG is working on 6 films in pre-production; another 20 are in full production. In 2012 NMG clients appeared in films that grossed £288 million at box offices around the world.

Our close involvement with top film studios goes back years, for example, Warner Bros US sent NMG the script for ‘All You Need is Kill’ in August, where at Warner Brothers Leavesden Studios (home of Harry Potter), an epic set is being built replicating Heathrow airport.

What is less easy to predict and what we are often asked is where the unexpected hits may lie. Based on the scripts he has read this year NMG’s James Warren predicts for 2013:

‘I Give It A Year’: ‘“great comedy cast, fantastic script!”
‘Close Circuit’: “a taut, exciting, classy thriller starring two fantastic actors”
‘The World’s End‘: “eagerly anticipated final part of the Sean Of The Dead trilogy, edgy, cultish and hilarious”

An NMG Product Placement Commentary

 
Background.
 
On 28th February 2011 Ofcom first permitted paid for product placement in UK commercial TV.

Ofcom’s paid for product placement guidelines can be found at

http://consumers.ofcom.org.uk/2011/02/product-placement-on-tv/

Relevant to this viewing study Ofcom’s guidelines include:
 
How can products be placed?
 
There must be ‘editorial justification’ for a product to be placed in a programme.

That means the product must be relevant to what the programme is about. The content of programmes shouldn’t seem to be created or distorted, just to feature the placed products.

Programmes also can’t promote placed products or give them too much prominence. So there shouldn’t be any claims made about how good a placed product is, or so many references to a product that it feels like it is being promoted.

Pinewood Studios based NMG Product Placement records and analyses brand appearances within TV and film using our Tracker™ system. Tracker™ was first introduced in 1987 and is used by over 80 major UK brands, whose feedback has aided its continuing development.

For this study NMG viewed over 364 hours of broadcast programming containing brands that were the subject of paid for product placement deals.
 
Results so far
 
After a slow start sufficient deals now exist to form a snapshot of activity, results and future challenges.

The following table below provides visibility examples of “paid for” deals in recent months. The frequency and quality of brand appearances varies over time, thus the tables describes average exposure.

 
Conclusions.
 
Our observations suggest that some of the above deals may well be in breach of Ofcom’s Guidelines, whilst others promote the best interests of the viewer and advertiser by offering seamless integration.
 
Viewers generally react adversely to overt “brand plugging”. Thus the repeated presence of the “deal” brands, a lack of competitive brands, plus the “P” symbol flagging up that “deal” brands appear as a result of a commercial arrangement that does not directly benefit the viewer, could generate negative consumer reaction, even brand boycotting.
 
NMG’s recommends that brands maximise their product placement campaigns by utilising a variety of product placement techniques:

“paid for” on commercial TV,
free prop supply in BBC and commercial TV,
paid for and free prop supply in film with promotional tie in exploitation,
post production digital insertion,
web dramas, commercials, music videos, etc
 
With a properly managed product placement campaign consumers will receive a wider variety of product placement visibilities varying from subtle to overt, through a wider range of viewing platforms generating a much stronger and more persuasive overall impact
 
NMG’s tracking and evaluation system, Tracker™, can be used to measure relative ROI’s and professionally develop brand product placement campaigns using the same disciplines used in other advertising channels.
 
Chloe Thompson and NMG Team
3 October 2012
 
Background:
 
NMG Product Placement is based at Pinewood Studios and founded the UK product placement industry in 1984. NMG commenced measuring product placement in 1987.
 
NMG Product Placement is retained by over 85 major brands.
 
Tracker™ 2011 records and evaluates over 20,693 brand appearances each year from over 2190 hours viewing across 21 TV channels. Each brand appearance is measured to the nearest second and categorised into 5 levels of saliency. Brands are further segregated into over 300 product categories.
 
For comment or interview please contact:
 
John Barnard, FCA, Chairman, NMG Product Placement: john.barnard@newmediagroup .co.uk
or
Sarah Curran, Business Development Director on sarah.curran@newmediagroup.co.uk or 01753 655866

http://www.bbcamerica.com/anglophenia/2012/10/lingerie-firm-enjoys-the-downton-abbey-effect/

Giving brands roles in movies will soon be a $2bn industry, reports Mark Leftly

http://www.independent.co.uk/news/business/news/a-star-is-born-as-product-placement-hits-the-screen-8165632.html