Over the past five years or so, it has become increasingly obvious that the broadcasting sector is in the midst of a dramatic and disruptive revolution driven, for the most part, by rapidly changing consumer viewing preferences and unrelenting technological development.
Technology surely carries some of the “blame”. Zipping, zapping, TiVo, DVRs, live streaming, transmedia and ‘over the top’ viewing are all changing the way that audiences consume programming which, in turn, is altering the ROI equation for advertisers.
The reality is that a dwindling number of viewers are now exposed to TV advertising as a growing number of consumers start to speed up, slow down or altogether skip ads that are broadcast during shows. For many, advertising breaks represent a welcome opportunity to pick up the tablet, smart phone or laptop in order to check in on social media, respond to emails or even play a quick game.
Moreover, as more programmes become digitised and beamed out to audiences around the world, ‘first run’ advertising is rarely – if ever – included, often because it tends to run under separate arrangements. Similarly, DVD sales of popular television series also do not carry advertisements.
Product placement, on the other hand, provides advertisers with longevity that simply cannot be achieved through traditional spot ads: for as long as TV shows such as Friends and Mad Men continue to be re-broadcast, product placements that had been embedded into the shows will continue to reap a return on their investment (much to the pleasure of brands like Oreo or virtually every account that Don Draper worked on).
I believe that we have reached a tipping point and – as traditional broadcasts become increasingly overshadowed by new technologies – everyone from advertisers through to the broadcasters themselves will recognise the advertising potential of product placement.