Product Placement in Peril?

There’s something to be said for subtlety in advertising. That may well explain why traditional media buyers flock to secure product placements in top-rated TV shows, and online buyers covet integrated ad placements to boost product branding without a hard sell.

A few weeks ago, Commercial Alert, a consumer watchdog organization, filed a petition with the Federal Communications Commission (FCC). It could make TV product placement, as we know it, a thing of the past.

Calling undisclosed paid placement advertising “an affront to basic honesty,” Commercial Alert wants all product placements (along with plot integration and title placements, paid spokespersons, etc.) prominently disclosed to ensure consumers know placements are, in fact, paid for by advertisers. Gary Ruskin, the group’s executive director, regards product placement as “stealth advertising” and “veiled commercial pitches.” If Ruskin had his way, he’d ensure brands like Doritos and Mountain Dew never again appear on an episode of “Survivor” without a conspicuous accompanying message disclosing their nature and origin.

Offline media buyers are livid at even the prospect of this. They’ve come to rely on this method of advertising. Product placement is predicated on the concept of subtlety. Media buyers fear Commercial Alert’s recommendation will diminish the effectiveness of placements. One media buyer, who requested to remain anonymous, was quoted as saying product placement disclosures would, “diminish the very reason why we do product placement deals — to integrate products into a show without calling attention to them as commercials.”

Featuring products within programming in an understated manner speaks to specific demographic markets. That’s what attracts advertisers to paid placement buys. Integrated placements, whether off- or online, enable advertisers to brand their products in a unique environment. They command consumer attention with little or no competition from rival brands.

Given the extent to which consumers are exposed to advertising, a degree of hostility (or just plain indifference) to TV spots is inevitable. Top that off with consumers’ newfound ability to skip ads (if they’re using digital video recorders like TiVo); to banish online pop-up ads; or to send commercial email straight to the trash folder. No wonder advertisers so fervently embrace product placement.

Product placement may be a growing alternative to traditional advertising, but it certainly isn’t unique as such. Advertisers are coming up with myriad ways to get their message across without resorting to old-fashioned advertising.

Look what’s been going on here in Canada, where anti-smoking legislation forced tobacco companies to get very creative. The law prevents Canadian tobacco companies from advertising in print magazines. There’s also a ban on sponsorship activities, striking a major blow to costly events such as the Montreal Grand Prix. Rather than accept defeat, Imperial Tobacco, makers of the du Maurier and Player’s brands, partnered with Multi-Vision Publishing to develop a magazine for men. It specifically targets male smokers.

Both in Canada and the United States, Procter & Gamble incorporates product placement in its online magazines. The consumer packaged goods giant, which produces magazine-style Web sites for its target audience of Moms, promotes the sites online and drives traffic with e-newsletters. The sites do contain obvious ad messages in button and banner formats, and also contest promotions. But the company’s products are also incorporated into site content, not only for branding purposes but also to educate consumers about new and existing products.

Whether Commercial Alert will get anywhere with their product placement plea remains to be seen. If history is any indication, media buyers should be weighing new options when planning upcoming campaigns.

Does Commercial Alert’s name sounds familiar? That’s probably because it’s the same group that approached the Federal Trade Commission (FTC) two years ago with a similar complaint, then in reference to paid search advertising not identified as such. As a result, the FTC made a point of recommending search engines clearly mark paid placement search results.

All you media buyers who rely on product placement to promote your clients’ brands: You may find yourselves back at the drawing board, brainstorming alternative techniques. If the above examples are any indication, it seems there are still a good many product placement opportunities to be had, online and off-.