TV’s Old Product-Placement Era Could Be Nearing Its End

Analysis: After years of jamming soda cans and car logos into scripted-TV series, Madison Avenue wants to try other techniques

When the CW drama “Gossip Girl” launched in the fall of 2007, advertiser interest in the show’s trendy young characters was so intense that AT&T, Verizon Wireless, T-Mobile and Sprint clawed each other for the right to get phones and gadgets into their hands. Just seven years later, the same crowd seemed indifferent to an even more obvious opportunity: the debut on ABC of “Selfie,” a comedy with a heroine who had a smartphone more or less glued to her palm.

“Product integration never made its way into ‘Selfie,’ which I found surprising,” says Emily Kapnek, creator and showrunner of the Warner Bros.-produced comedy. “Before production started, as always, there was much talk of keeping an eye out for the right partnership — but nothing ever really materialized.”

The absence of obvious markings in “Selfie” from Samsung, Verizon or any of their rivals is one of several signs suggesting that Madison Avenue is looking differently at so-called product placement, the decades-old practice of inserting name-brand cans of soda, gadgets, and cars into the scenes and dialogue of TV programs. The technique has been used since the dawn of TV, when companies like Texaco and Kraft would sponsor programs like “Texaco Star Theatre” or “Kraft Music Hall” and plaster them with overt ad messages. In more recent years, TV networks have turned more aggressively to product placement to help goose ad sales that have been crimped by new gizmos and technologies that let viewers fast-forward past or otherwise ignore TV commercials.

Now, with more video available via digital streaming, advertisers are looking elsewhere, which could have an effect on how TV networks cast for ad deals in the coming upfront market, when they try to sell the bulk of their ad inventory. “There is a massive shift to digital,” says Claudia Cahill, chief content officer for Content Collective, a unit of Omnicom Group ad buyer OMD that specializes in weaving advertising into content. With more opportunities available to sponsor activities related to watching TV programs on mobile devices, she added, product placement is looking like “a very dated practice.”

Some famous examples of the technique have ended in recent months. Coca-Cola has pulled its signature red cups from the judges’ table on “American Idol.”  Hyundai took its kiwi-green Tuscon vehicle and drove it out of AMC’s “The Walking Dead.”

TV networks are not abandoning the stuff. Target has made appearances in episodes of the CW’s “Jane the Virgin” this season, and a Toyota vehicle was laced into the plot of an episode of ABC’s “Modern Family” about getting a new car for character Hayley Dunphy. Ad buyers suggest deals that involve product placement crafted during the upfront remained on par with those in years past. But even some TV network executives quietly concede the technique calls for more sophistication, as marketers strive to get their TV commercials to generate “buzz” on social media.

“People are getting more savvy on how to do it,” explains Jeff Lucas, head of sales for Viacom Music and Entertainment. “We can do something on the screen that can take off socially.” During the most recent broadcast of the Video Music Awards on MTV, for example, Unilever sponsored live segments featuring Iggy Azalea.

In months to come, advertisers are likely to look for other ways of hitching advertising to the programs it accompanies. Consider Walmart’s recent forays with NBC’s live airings of “The Sound of Music” in 2013 and “Peter Pan” in 2014. The retailing giant created commercials that made use of songs from the plays, and NBC made sure to run the spots just after the scenes in which the tunes appeared. A similar technique has been at work on AMC’s “The Walking Dead,” during which commercials from Microsoft and Hyundai present themes related to zombies — the central antagonist of the popular drama.

The days of jamming the mention of a Subway sandwich or Dr. Pepper into dialogue in, say, CBS’ “Hawaii Five-0” or NBC’s “Chuck” or the CW’s “90210” — all actual examples — may be coming to a close. “You are seeing less active, forced integration in shows,” said Dan Riess, exec VP of integrated marketing and branded content for the ad-sales unit of Time Warner’s Turner Broadcasting.

In their place stand complex arrangements that must be built weeks in advance. Turner has signed MillerCoors to multiple deals over the past few years that make the brewer’s drinks and logos available for use in various programs on TBS and TNT.  FX Networks struck a similar pact last year. The deals suggest a more complex and collaborative effort that requires weeks, if not months, of planning between marketing executives and show producers.

In a TV business splintered by the dozens of new ways consumers can gain access to video, after all, cameos by beer cans and cars need to stand up to scrutiny. They can show up in a particular episode of “The Good Wife” or “The Americans,” but they’ll appear again and again thanks to video streaming and video on demand. So most advertisers work to make sure the guest-star roles push viewers elsewhere for more information. “One thing clients don’t want are one-offs,” said Linda Rene, exec VP of primetime sales and innovation at CBS.

Kellogg’s Pop-Tarts recently surfaced in an episode of the TBS comedy “Men at Work.” To lend its presence some momentum, the network used its Facebook page to call out the minor role to followers.

Rather than straining their eyes in search of product intrusions into favorite series, viewers might want to narrow their gaze at how logos and other distinctive brand markings burrow in new fashion into commercial breaks and other parts of the TV screen. Viacom’s MTV has a team of artists and creatives at the ready to help advertiser attach their pitches to video vignettes crafted to nod to breaking events. And Time Warner’s Adult Swim these days allows sponsors to take over the network’s “bug” – the logo it places in the lower right corner of the screen.

Such stuff may be easier to put into practice than the typical product placement. “I will say that when it happens, product placement is always a double-edged sword.  On the one hand,  it allows you luxuries your normal budget isn’t patterned for, but on the other hand, the requirements for satisfying the sponsor can involve much more than an old school shout-out,” said Kapnek, the “Selfie” creator. “Sometimes there are demands that entire storylines revolve around the product or that certain aspects of the product are showcased for a specific duration. This leads to integrations that don’t feel very integrated.”

Maybe that’s why more products in weeks to come are likely to be placed alongside shows, rather than inside of them.

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