Product PlacementHistory and Impact on UK TV Audiences

ITV Commercial Research Presentation 1.014.01.2013

UK Product PlacementBrief History & Regulation

Until Feb 28th 2011, regulation had banned the inclusion of, or reference to, a product or service within a programme in return for payment.

References were allowed "where their inclusion within the programme was justified editorially“

Goods could also appear if they are obtained from a company for free or at a reduced rate to lower the cost of production and justified editorially (aka “Prop Placement”)

Product Placement in the UK Marketplace

Product Placement in the UK Marketplace

From 28 February 2011, paid-for references for products and services have been permitted in programmes.

However, the new regulations include:

1. restrictions on the types of products that can be placed

2. some restrictions on the types of programmes in which products can be placed

3. limits on the way in which products can be seen and referred to in programmes (editorial justification test)

4. PP logo requirement (at start & end of programmes, also at the end of commercial breaks)

Broadcasting Code Summary for Product Placement (Post Deregulation)

• News and Children’s (whether produced in UK or acquired from abroad)

• Current Affairs, Consumer Advice, Religious Shows

No PP allowed in:

• Films• Series made for TV• Sport• Light Entertainment

PP allowed in :

• Tobacco, Alcohol, HFSS brands, Gambling, Baby Milk, Medicines and any product that can’t be advertised on TV

No PP of the following Products:

Post Deregulation, ITV had the 1st paid for Product Placement on TV in the UK.

Brand: Nescafe Dolce Gusto

“Pod” Coffee Machine

Programme: This Morning

Placed in: kitchen/cooking section @ 11:30 – 12:00am

daily

Viewed on ITV1 and also ITV Player

Nestle made marketing history on 28th February 2011 when it became the 1st brand to appear in a UK made programming on a paid-for basis

..this was followed by ITV’s 1st peak time placement deal with Nationwide ATM in Coronation Street.

Brand: Nationwide ATM

Programme: Coronation Street

Placed in: Dev’s Shop

1st TX: 19TH November 2011

Viewed on ITV1 and also ITV Player

Nescafe Dolce Gusto (This Morning Kitchen)

Nationwide (Coronation Street)

Welcome To Yorkshire (Emmerdale)

Concept 2 Rowers (Britain’s Biggest Loser)

Product Placements are becoming the norm on ITV since deregulation..

B&Q (This Morning Kitchen)

DFS Sofas (This Morning)

Samsung (X Factor)

Highland Spring (Dancing On Ice)

ITV has an on-going research programme to understand and measure the impact of PP, both before and since deregulation - it has 3 main objectives, which are to understand:

1. The Viewer Experience

2. Programming and Editorial Implications

3. Commercial Impact

This research programme covers both qualitative and quantitative techniques including eye-tracking, focus groups, omnibus and adhoc surveys.

Measuring the impact of Product Placement (PP) @ ITV

Product Placement Insights from PP Research (Coronation Street)

In a PP research study on Coronation St using post production digital placements

• 91% viewers stated that seeing the brands within the programme made no difference to their enjoyment of the show

• 7% claimed more enjoyable !

PP added to programmes, has little or no detrimental effect on viewers actual enjoyment……

Source: ITV/Nielsen Quant Study (Main – 6 brands / 3 episodes) Dec 2009 (n=1600 Coronation St Viewers)

93% of eye-tracker respondents agreed that it is more realistic to see brands

In fact, relevant PP can add depth and reality to a programme…

57%

35% Strongly agree

Agree

Neither agree nor disagree

Disagree

Strongly disagree

“I think seeing brands in TV programmes is more realistic than having no brands”

Notes: Eye-tracker sample (n=60),, Eps: 4th Dec: 2 brands, 7th Dec : 2 brands

Strongly Agree

Strongly Disagree

Source: ITV/KAE Marketing Dec 2009

Page 13

I think it can add to the reality of the programme

Female, 55+, Ep2

It is totally reasonable to see product placement on soap operas - it is meant to reflect real life and products are part of real life - it

just looks stupid when you see fake made up items

Female, 18-34, Ep2

Because they are part of everyday life you don’t spot it

Leeds, 25-44

It’s up to date, you do see these things in real life

London, 45-65

They’ve got a shop and pub and fish and chip so it’s fine – it makes it more real life by adding to these

scenarios

Leeds, 25-44

Notes: Focus Groups 4 x 1.5 hrs (n=32) pre-tasked with viewing diary

Product placements are seen as natural additions to programme content reflecting real life:

Source: ITV/KAE Marketing Dec 2009

Source: ITV/KAE Marketing Dec 2009

PP does have obvious and clearly defined limits for the viewers and must …..

1) not detract or interrupt viewing experience

2) fit the storyline – right time, place, product and programme

Notes: Focus Groups 4 x 1.5 hrs (n=32) pre-tasked with viewing diary

I am happy for product placements to be used as long as they fit into the storyline

Female, 35-54, Ep2

I think if it is done in a subtle way which does not spoil the

programme then I have no objection to it

Male, 55+ , Ep2

84% eyetracker respondents agreed that: Product placement should not affect the storyline I don’t mind products being shown if they fit with the story

Notes: Eye-tracker sample (n=60),, Eps: 4th Dec: 2 brands, 7th Dec : 2 brands

When considering longer term PP, consistency of brands across episodes is important…

The Special K has to be out at the right time of day…it couldn’t be out at tea time

Leeds, 25-44It wouldn’t be realistic if the cereal

someone was using changed every weekLondon, 45-65

How long will it stay William Hill? You would need some kind of consistency

Leeds, 25-44

The bus stop one works well because that changes quite a lot

Leeds, 25-44

Right time and right placeRight number of repetitions

I noticed it had William Hill when its actually Barlow’s which is an independent

London, 25-44 You wouldn’t expect Roy and Hayley to drink Ribena

Leeds, 25-44

[Claire]’s really tidy though so I don’t know why she would leave it out

Leeds, 25-44

Notes: Focus Groups 4 x 1.5 hrs (n=32) pre-tasked with viewing diary

11%

89%

Exposed Group (PP)

Spontaneous Recall No Recall

Viewers exposed to PP showed significant increases in general spontaneous brand awareness…..

Significant difference at 95% confidence limit

Coronation St Viewers

5%

95%

Control Group (No PP)

Spontaneous Recall No Recall

Source: ITV/Nielsen Quant Study (Main – 6 brands / 3 episodes) Dec 2009 (n=1600 Coronation St Viewers) control n= 643, exposed n = 957

62%

38%

Prompted (Visual shown)

Recall No Recall

Significant difference at 95% confidence limit

Coronation St Viewers

30%

70%

Prompted (no Visual)

Recall No Recall

Source: ITV/Nielsen Quant Study (Main – 6 brands / 3 episodes) Dec 2009 (n=1600 Coronation St Viewers) control n= 643, exposed n = 957

PP’s are consciously remembered by viewers….

16%

84%

Purchase Interest

Raised Not Raised

Significant difference at 95% confidence limit

Coronation St Viewers

15%

85%

Opinion Of Product

Raised Not Raised

Source: ITV/Nielsen Quant Study (Main – 6 brands / 3 episodes) Dec 2009 (n=1600 Coronation St Viewers) control n= 643, exposed n = 957

Notes: Opinion: Greatly/Somewhat improved; Interest in Purchasing: Strongly/Somewhat increased @ 80% claimed no change in opinion or influence in purchase intent

….with positive outcomes for brands

Coronation Street PP Study provided ITV with key insights on..

Viewers Editorial Implications Commercial Benefits

Relevant PP does not detract from or interrupt the viewing experience

It can add depth and reality (when done well) to a programme

A majority (91%) of viewers to treated episodes, agreed that seeing the placements made no difference to their enjoyment of the programme

Viewers enjoy PP’s, with the lack of disruption to the viewing experience being an important quality

Relevant PP does not detract from or interrupt the viewing experiencePP must always fit the storyline – right time, place, product and programme.

PP’s are seen as “natural additions” to programmes

The consistency of PP across episodes is important, frequent product changes (eg: cereals) will be noticed, but outdoor advertising placements could be changed.

PP opportunities are often limited

Unprompted spontaneous awareness was significantly higher for PP’s in episodes.

Specific PP’s are consciously remembered with 30% average prompted recall rising to 62% when shown an image of placement.

Opinion of product was raised amongst 15% of viewers

16% of viewers claimed a raised interest in buying product