Product placement is a form of advertisement, where branded goods or services are placed in a context usually devoid of ads, such as movies, the story line of television shows, or news programs. The product placement is often not disclosed at the time that the good or service is featured.
In April 2006, Broadcasting & Cable reported, "Two thirds of advertisers employ 'branded entertainment'--product placement--with the vast majority of that (80%) in commercial TV programming." The story, based on a survey by the Association of National Advertisers, added, "Reasons for using in-show plugs varied from 'stronger emotional connection' to better dovetailing with relevant content, to targetting a specific group." 
Philip Morris paid film producers for featuring the specific products (such as Marlboro) in films and for failing to disclose it. Children were primary target.  Placing cigarettes and chewing tobacco for payment is now against FCC regulations.
In January 2005 British celebrity chef Jamie Oliver admitted accepting £15,000 ($US28,000) from Heinz as part of a product placement deal in which he agreed to include an up-market version of baked beans on toast on the menu at his restaurant. "I should have been brighter," Oliver told The Independent. The success of Oliver’s television cooking program, The Naked Chef, has led to three books and a follow up television series.
In news programs
In July 2008, the Las Vegas Sun reported that, for two weeks, "two cups of McDonald’s iced coffee (BUY!) sit on the Fox 5 TV news desk, a punch-you-in-the-face product placement (BUY!) to chase down your morning news" on local station KVVU. The "punch-you-in-the-face product placement" agreement lasted six months. KVVU's news director claimed that the "nontraditional revenue source" won't impact his station's reporting.  But an executive with the marketing firm that negotiated the deal, Omnicom's Karsh/Hagan, told the New York Times that "the coffee cups would most likely be whisked away if KVVU chooses to report a negative story about McDonald's." McDonald's has similar product placement agreements with "WFLD in Chicago, which is owned and operated by Fox; on KCPQ in Seattle, a Fox affiliate owned by the Tribune Company; and on Univision 41 in New York City." Other stations owned by KVVU parent Meredith Corporation, "including WFSB, the CBS affiliate in Hartford, Conn., and WGCL, the CBS affiliate in Atlanta -- are also accepting product placements on their morning shows." 
In January 2006, Advertising Age reported that "local TV news operations hungry for free content have intersected with brand brokers looking for product placement opportunities." The segments "typically come in the form of four-minute lifestyle segments that are dedicated to one brand and feature a brand's spokesperson chatting with the show's host and delivering the product's message to viewers. Third-party endorsements may also appear, as well as follow-up information about a product on a station's Web site. The marketer controls how its brand will be presented, who the spokesperson will be, signage, scripting and what the segments will look like." 
While many shows "still offer non-bought space," more TV producers are "adopting a pay-for-play model that could increase the time period's revenue for a station from between 50% and 100%. Stations -- especially those owned by Gannett in markets such as Atlanta, Denver, Cleveland, Phoenix, Sacramento and Minneapolis -- are now charging ... $2,500 a pop." 
In March 2006, Gail Schiller reported for Reuters that "increased competition and pressure on advertising revenue" are prompting television stations to contact "product placement, media and branded entertainment agencies," to integrate clients' products "into news programing in exchange for buying commercial time or paying integration fees." Disclosure of such arrangements is generally limited to a brief announcement or a line in the end-of-show credits. Schiller wrote, "At present, full-fledged brand integration into news programing appears to be limited to local news, but some marketing experts suspect that the network morning news shows won't be far behind." 
Schiller reported that KRON-TV in San Francisco, KMEX-TV in Los Angeles, and KPTV-TV in Portland "confirmed that they have integrated advertisers into their newscasts." KCAL-TV in Los Angeles and Gannett NBC affiliates in Denver, Minneapolis, Atlanta and Cleveland "are experimenting with integration into newsmagazine-type shows that they describe as entertainment rather than news." According to Reuters, ABC's "Good Morning America" also broadcast from a cruise ship. The cruise company "did not pay integration fees," but "did foot the bill for airfare, room and board to send nearly 300 women," who won an ABC contest, on the cruise. 
The practice has been challenged by several groups. In 2005, the nonprofit advocacy group Commercial Alert asked the U.S. Federal Trade Commission to regulate product placement; their request was denied.
The same year, Hollywood writers and actors complained that "placement practices hurt their artistic integrity and that they aren't paid for helping to sell the products placed in movies and TV shows." The Writers Guild and the Screen Actors Guild urged "disclosure at the beginning of each movie and TV program of the advertising that has been woven into the script" and "limits on the use of such advertising in children's programming." The guilds said if the network and studio executives wouldn't negotiate, they would bring their concerns to the Federal Communications Commission (FCC).
In particular they pointed out that Burger King products were woven into the "The Apprentice" where "contestants wore Burger King uniforms and flipped burgers as part of a challenge." The Guild stated that product placement in films jumped 44% last year, with revenue topping $1 billion. 
In an interview with Broadcasting & Cable, FCC Commissioner Jonathan Adelstein said product placement "is permissible, so long as it is disclosed," but that the FCC "could be more aggressive in monitoring the material that goes out. ... But given that we are not set up as an investigatory agency, we're going to rely heavily on outsiders to provide us information." 
While some broadcasters have "enhanced their disclosure" of product placement arrangements voluntarily, sometimes "it is virtually impossible for the average viewer to see because it is so small and passes by so quickly during the closing credits," Adelstein said. "We do have requirements about the size and length of disclosure for political advertising. I don't see why we shouldn't have the same for any advertising that needs to be disclosed. The current regulations require full and fair disclosure, but we have never spelled out what that means." 
Articles and resources
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- Abigail Goldman, "Eye-opener with a pitch: TV news program tries product placement as revenue source," Las Vegas Sun (Nevada), July 21, 2008.
- Stephanie Clifford, "A Product's Place Is on the Set," New York Times, July 22, 2008.
- brandcameo Database of product placements in major movies from 2001 to present.
- brandspotters Examples of product placement and plugs in movies, television, and webisodes.
- iTVX - Company that calls itself a "global leader in measuring the quality of product placement."
- Stephen Skinner, "Embedded Ads," Background Briefing, Australian Broadcasting Corporation Radio National, 22 February 2004.
- John Plunkett, "Heinz paid £15k for Jamie's beans on toast", Guardian News (UK), January 13, 2005.
- Kris Oser, "How a product placement strategy worked for Yahoo", AdAge, January 31, 2005.
- Stuart Elliot, "Greatest Hits of Product Placement", New York Times, February 28, 2005.
- Gregory M. Lamb, "Product placement pushes into print", Christian Science Monitor, September 29, 2005.
- Gal Beckerman, "Product Placement: It's Everywhere, It's Everywhere", "Hidden Angle ", CJR Daily, September 29, 2005.
- Writers Guild of America, "Entertainment Guilds Call for Industry Code of Conduct or FCC Regulation for Product Integration in Programming and Film: Guilds Issue White Paper Report on the Runaway Use of Stealth Advertising in Television and Film", Media Release, November 14, 2005.
- "“Are You SELLING to Me?”: Stealth Advertising in the Entertainment Industry", Writers Guild of America,November 14, 2005.
- Sharon Waxman, "Hollywood Unions Object to Product Placement on TV", New York Times, November 14, 2005.
- Merissa Marr, "Hollywood Writers Push Back Against Product Placements," Wall Street Journal (sub req'd), November 14, 2005.
- Keith O’Brien, "Media Matchmaker bows", PR Week, January 16, 2006. (Sub req'd).
- Gail Schiller, "In risky move, newscasts adopt product placements", Commercial Alert, March 15, 2006. (This is a Reuters/Hollywood Reporter story).
- John Eggerton, "More Spot Bucks Board Brandwagon," Broadcasting & Cable, April 19, 2006.
- Erica Iacono, "PR can take lead in product placement", PR Week, June 1, 2006. (Sub req'd)
- Gina Chon, "Jaguar Tries a Living Product Placement", Wall Street Journal, June 29, 2006. (sub req'd)
- Joseph Turow, "Hidden messages: Is new technology empowering consumers -- or marketers?" Boston Globe, August 27, 2006.
- iTVX Staff, "iTVX Product Placement Glossary," iTVX.net, September 11, 2007.
- Press release, "Writers Guild, West asks FCC Chairman Martin to Help Protect Creative Artists and Audiences from Product Integration, Calls For 'Real Time' Disclosure and End to VNRs," Writers Guild of America West, June 25, 2008.
- Mike Flaherty, "TV product placement dips: Ads on primetime down nearly 15%," Variety, September 15, 2008.
- Wayne Friedman, "Nielsen: Networks Hit By Big Product Placement Drops," MediaDailyNews, September 16, 2008.
- Diane Farsetta, "Stealth Marketers Gone Wild: Will the FCC Act?," PR Watch, September 23, 2008.
- John Eggerton, "Media Cos. Plug Product Placement at FCC: National Media Providers: FCC lacks jurisdiction; FCC rules already in place to prevent most abuses," Broadcasting & Cable, September 23, 2008.