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03.05.2023
Product placement goes digital: Virtual product placement in movies and series
What would James Bond be without product placements? Cars, mobile phones, laptops, beer and many more - nothing for which the makers would not have granted a licence to place. Famous product placements like those in the James Bond series abound, and the advertising budget that companies spend on them is significant. For example, the appearance of Heineken's beer bottles in "Skyfall" was worth about 45 million USD.
"New" possibilities through virtual product placement
Technically, it has been possible for several years to add or change product placements in post-production or later on. However, the big trend of this phenomenon has not happened yet. But how would it be if in the series "Friends" Phoebe wouldn't hate Pottery Barn, an American furniture store chain, and then love it in the end (like Rachel and Ross from the beginning), but a company based in Germany would appear in the German version? This would significantly increase the productions' advertising revenue and could even be beneficial to the plot if viewers associated a brand they knew with the storyline.
The Commission for Licensing and Supervision (ZAK), which among other things monitors compliance with advertising regulations, already controlled a case of this digital change in 2014 in the context of the series "Berlin Tag & Nacht"
This technical achievement could now receive a new boost through the innovations announced by NBC Universal and Amazon for Virtual Product Placement.[2]
Virtual Product Placement offers numerous advantages for filmmakers, exploiters, as well as advertisers, including:
Production facilitation:
- Decide on commercialisation/product placements only after production is finished
Flexibility:
- Decide only in post-production which product/brand fits where.
- The product placement is not permanent (image protection if brand or work falls out of grace, etc.)
- Regional differences possible
- Updating possible if brands undergo changes
Extended value generation opportunities:
- Future advertising revenues also possible
Product placements are subject to legal restrictions, which must not be forgotten despite all the enthusiasm for the technical possibilities:
Regulations for product placements
According to the State Media Treaty (MStV), product placements are generally permissible, except in the case of news programmes, political information programmes, consumer programmes, regional window programmes, programmes with religious content or children's programmes.
However, it is a prerequisite that editorial responsibility and independence with regard to content and placement in the broadcasting schedule are maintained, that the product placement does not directly encourage purchase, rent or lease and that the product is not given too much prominence. Last but not least, product placement must be clearly indicated at the beginning, at each continuation and at the end by the insertion of the letter "P".
In addition to these general regulations, there are further restrictions for public service broadcasting, such as the prohibition of product placements in the specially commissioned programmes of lighter entertainment (entertainment programmes, infotainment, guidebooks, etc.).
Virtual Product Placement = Virtual Advertising?
The MStV also regulates so-called virtual advertising. This is advertising that is only inserted through digital image processing. This is primarily aimed at the editing of banners during sports broadcasts. It has not yet been conclusively clarified whether virtual product placement is also to be understood here. In the case which the ZAK had to decide, the Commission does not address virtual advertising, but discusses "virtual product placement" solely on the basis of the requirements for product placements.[3] This concerned the subsequent replacement of a film poster in a series, although the ZAK expressly spoke of a decision in the individual case.
The legal prerequisite for the admissibility of virtual advertising would be, in addition to the necessary indication, that only advertising that already existed anyway was replaced.
Regulations for advertising in general
Finally, general advertising regulations should not be forgotten. Above all, restrictions under competition law, such as the prohibition of misleading advertising, are important here. But also special legal restrictions for cigarette ( Section 20 TabakerzG), pharmaceutical (Section 10 para. 1 HWG) or gambling advertising (Section 5 GlüStV) should be taken into account.
Retroactive Changes to Existing Films
The technical possibilities outlined above can also be used to change product placements in older series and films. Here, in addition to the (advertising) legal pitfalls outlined, the copyright of the filmmakers must also be taken into account. If the possibility of modification was not contractually stipulated and no approval has been given, the modification could be inadmissible.
Future outlook: individualised virtual product placement in real time
A newer phenomenon that could complement digital product placement is the possibility of individualising digital insertions in real time depending on the viewer. So-called "streaming ad insertion" is already known from platforms like Spotify, which can personalise advertising before, during or after podcasts. Even if this will be less relevant for broadcasting in cinemas, it could play a role for streaming services.
In addition to the advertising regulations that must be complied with in principle, data privacy and the usage of cookies must also be legally considered here.
So the future will show whether the James Bond films will soon look a little different for everyone.
[2] https://advertising.amazon.com/blog/amazon-ads-newfronts-2022
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