Global product placement is growing, but at a slower rate than in the past, a new report released yesterday found.
And for the U.S., the global product placement leader, growth is projected to decelerate over the next four years, but still account for double-digit figures, according to the PQ Media Global Product Placement Forecast Series 2006 to 2010: Country by Country Analysis.
The report, released yesterday, said that global product placement is expected to increase by 30.3% to $4.38 billion this year. In 2006, the tactic rose 37.2% to $3.36 billion, it said.
While the growth is slowing, product placement remains a viable tactic for brand marketers.
“As a new media order has emerged in recent years, our research indicates that we are entering an era of alternative advertising and marketing strategies,” said Patrick Quinn, President/CEO, PQ Media, in a statement. “Brand marketers are seeking to better engage consumers with emotional connections and media companies are searching for new revenue streams as traditional advertising methods suffer from negative perceptions. As a result, product placement has emerged from a novel marketing tactic just a few years ago to a key marketing strategy worldwide.”
Topping the list is TV placement, which accounted for $2.4 billion or 71.4% of global spending in 2006. That area is projected to grow nearly 34% this year, PQ Media said. Film placements follow at $885.1 million or 26.4% of global spending last year. That segment is forecast to increase another 20.5% this year, thanks to more cross-promotional packages linking movie placements to ad spots, Webs sites and P-O-P displays.
Video game, online placement and other media targeting 18 to 34- year-olds, which accounted for a mere 2% of total spending, is expected to rise by more than 30% this year, according to the report.
The Americas will remain the largest markets for paid product placement in 2007, with an estimated $3.79 billion in spending, or 31.2% growth, followed by Asia and Europe. This year, the U.S. is projected to be a top market for product placement spending with $2.9 billion, followed by Brazil, Mexico, Australia, and Japan, but that growth is expected to slow over the next four years, the report said.
Spending aside, the value of non-paid placements, including barter and added-value arrangements, is declining. But their use is still viable. The overall value of the global product placement market, including the value of non-paid placements, rose 24.2% to $7.76 billion in 2006, and is projected to jump 20.3% to $9.33 billion this year, the report said.
The report covers 15 countries, including the U.S., segments paid product placement and non-paid, or barter arrangements where marketers offer products or services in exchange for placement or mention on a show. It includes research from the PQ Media Global Opinion Leader Panel, which includes more than 100 leading global media executives.
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