UK Free Prop Supply Product Placement

UK Free Prop Supply Product Placement

“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.
 

Typical Client Range
Number of placements aired in 12 months 685 +/-250
Number of separate programmes 41 +/-20
Tracker™ Media Value £6,175,000 +/-£2,500,000

 

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://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