Product Placement

Product Placement A look at the impact of product placement within ITV programming

Agenda • Background on VPP • Approach and Method • Product Placement Learnings and Insights • Summary • Areas to Explore

Product Placement (PP) in the UK TV MarketplaceThe current situation in a nutshell : • Rules ban the inclusion of, or reference to, a product or service within a programme in return for payment. • References are allowed "where their inclusion within the programme is justified editorially“ • Goods can appear if they are obtained from a company for free or at a reduced rate to lower the cost of production and justified editorially • Rules on course to be relaxed in 2010, following regulatory review

The Stakeholders/Players – anybody involved in regulation, content, brands and marketing • Regulators (DCMS) • Production Companies • Media Publisher/Broadcasters • Advertisers • Agencies • PR companies • Creative Services • Programme Viewers

The Fear Factor – Regulator concerns are generally around… • Editorial Integrity(less independence of editorial control) • Broadcaster Integrity(advertising and programme elements less separate) • ProgrammeQuality(lower) • AudienceEnjoyment & Engagement(lower)

However, the Winds of Change are blowing in favour of PP deregulation in the UK, some key factors are: • New EU Audio Visual Media Services directive, allowing PP in some types of programmes (now part of UK law) • DCMS review of PP in TV programmes (Jan 2010) • Pressure on UK programme makers to remain competitive against international competition. • Growinginterest in editorial and content solutions from UK advertisers.

We decided to take look at the impact, value and effectiveness of PP, by virtually integrating brands into ITV programmes online..…. With : • ITV Productions & ITV Studios for editorial and programme content management • ITV Sales, Advertising Agencies and their Advertisers for branded content/creative assets input • MirriAd for their expertise in embed advertising and their ability to manage virtual product placement (VPP) post production • ITV Multimedia and ITV Broadband for help in management of digital assets • ITV CMR, Nielsen and KAE for their quantitative and qualitative research skills

And……

Overall, 4 episodes of Coronation Street and 8 brands participated in the VPP research programme…. Ribena Harveys Kelloggs Special K Listerine BT Broadband William Hill Camelot (National Lottery) Peugot

Each of the 4 episodes had 2 brand placements added to compare against untreated programmes…. Friday 6th November (p) Friday 4th December Monday 7th December Thursday 10th December

Regular programme viewers were recruited to take part in a research programme, which looked at the….. • Viewer Experience • Programme and Editorial implications • Commercial Impact Research was conducted with….. Focus Groups and Eye-Tracking (treated episodes) Quantitative Study(treated and control episodes)

PP Learnings and Insights

PP added to programmes, made little or no detrimental effect to the viewers actual enjoyment…… • 91% stated that seeing the brands within the programme made no difference to their enjoyment of the show • 7% claimed more enjoyable ! Notes: Creative shown, Exposed Group, Nielsen Quant Study (Main – 6 brands / 3 episodes)

In fact, relevant PP can add depth and reality to a programme… I think seeing brands in TV programmes is more realistic than having no brands Strongly agree • 93% of eyetracker respondents agreed that it is more realistic to see brands 35% 57% Strongly disagree Notes: Eyetracker sample (n=60),, Eps: 4th Dec: Special K and Listerine, 7th Dec : BT and William Hill

Product placements were seen as natural additions to programme content reflecting real life: Because they are part of everyday life you don’t spot it Leeds, 25-44 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 They’ve got a shop and pub and fish and chip so it’s fine – it makes it more real lifeby adding to these scenarios Leeds, 25-44 It’s up to date, you do see these things in real life London, 45-65 Notes: Focus Groups 4 x 1.5 hrs (n=32) pre-tasked with viewing diary

PP does have obvious and clearly defined limits for the viewers and must ….. 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 • not detract or interrupt viewing experience • fit the storyline – right time, place, product and programme I am happy for product placements to be used as long as they fitinto the storyline Female, 35-54, Ep2 Notes: Focus Groups 4 x 1.5 hrs (n=32) pre-tasked with viewing diary 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: Eyetracker sample (n=60),, Eps: 4th Dec: Special K and Listerine, 7th Dec : BT and William Hill

When considering longer term PP, consistency of brands across episodes will be important… Right number of repetitions Right time and right place The Special K has to be out at the right time of day…it couldn’t be out at tea time Leeds, 25-44 How long will it stay William Hill? You would need some kind of consistency Leeds, 25-44 I noticed it had William Hill when its actually Barlow’s which is an independent London, 25-44 It wouldn’t be realistic if the cereal someone was using changed every week London, 45-65 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 The bus stop one works well because that changes quite a lot Leeds, 25-44 Notes: Focus Groups 4 x 1.5 hrs (n=32) pre-tasked with viewing diary

6 1 Viewers exposed to PP showed significant increases in general spontaneous brand awareness….. Coronation St Viewers Significant difference at 95% confidence limit *Recommendation, Favourability, Purchase Intent - Very/Somewhat Notes: Creative shown, Exposed Group, Nielsen Quant Study (Main – 6 brands / 3 episodes)

6 1 But, unsurprisingly, no significant movements in other key generic brand metrics (for established brands)… Coronation St Viewers Significant difference at 95% confidence limit NOT SIGNIFICANT *Recommendation, Favourability, Purchase Intent - Very/Somewhat Notes: Creative shown, Exposed Group, Nielsen Quant Study (Main – 6 brands / 3 episodes) , spon o/e and aided = prompt list

Individual brand attributes across the 8 brands were also measured … • Both positive and negative shifts noticed, BUT, nothing significantacross 8 individual brand placements • One placement in one programme is unlikely to significantly move attributes • Significant shifts in brand attributes usually occur onlyafter long term marketing activities Notes: Nielsen Quant Study (Main – 6 brands / 3 episodes)

PP’s are consciously remembered by viewers…. Coronation St Viewers 30%recallspecific placements,without a visual prompt 62%recallplacements, when shown an image of the placement in the scene Notes: Exposed Group : Nielsen Quant Study (Main – 6 brands / 3 episodes)

with some positive outcomes for the brands… Coronation St Viewers 15% stated that it had raised their opinion of product 16% stated that it had raised their interest in buying the brands Notes: Opinion: Greatly/Somewhat improved; Interest in Purchasing: Strongly/Somewhat increased @ 80% claimed no change in opinion or influence in purchase intent Notes: Exposed Group : Nielsen Quant Study (Main – 6 brands / 3 episodes)

6 in 10viewers thought the placements fitted the programme and a further 3 in 10 were unaffected….. Coronation St Viewers • 59% thought the placements fitted either naturally or seamlessly within the programme content Notes: Creative shown; Fit: Natural & Seamless/Somewhat Natural; Appropriate: Very/Fairly; Opinion: Greatly/Somewhat improved

… and 2/3rd of viewers thought the placements were appropriate in the programme. Coronation St Viewers • 68% thought it was appropriate for placements to be included Notes: Creative shown; Fit: Natural & Seamless/Somewhat Natural; Appropriate: Very/Fairly; Opinion: Greatly/Somewhat improved

Overall placements had no detrimental effect on enjoyment of the programme….. Coronation St Viewers • 91% stated that seeing placements within the programme made no difference to their enjoyment of the show Notes: Creative shown; Fit: Natural & Seamless/Somewhat Natural; Appropriate: Very/Fairly; Opinion: Greatly/Somewhat improved

Using eye-tracking technology, viewers are clearly looking at product placements…… Coronation St Viewers 93%looked somewhere on the poster in this scene over 5 secs. (Video 2) 30 participants, 4.714s

.. and were also picking our the smaller creative elements. Coronation St Viewers 93%looked somewhere on the poster in this scene over 5 secs. 10% looked at the additional logo 6% looked at the BT logo (Video 2) 30 participants, 4.714s

7% saw Brylcreem 20% looked at the Butterkist product 10% saw Alka Seltzer (Video 1) 30 participants, 2.611s (Video 1) 30 participants, 5.22s and were also looking at “prop” placements…… Coronation St Viewers 13%of respondents mentionedBrylcreem, while Alka Seltzer and Butterkist were also mentioned by two people each 28

All PP treatments were flagged with an ITVpp logo in the credits (a mooted regulatory requirement) and… Coronation St Viewers 50% recalled the ITVpp logo, howeverthere is a preference for this toremainsubtle and not disruptviewer enjoyment Don’t Know I noticed that symbol and I thought what does PP stand for? Leeds, 25-44 No You’d watch a programme and be looking for products if you saw that…if you are watching ITV you know that you are going to get adverts so they don’t need another logo Leeds, 25-44 Yes

PP treatments had no detrimental effect on viewers perceptions of ITV as trustworthy…. Regular Coronation St Viewers Three quarters felt that ITV is trustworthy with 24% of those exposed strongly agreeing compared to 23% of the control. ITV is a Company I feel is Trustworthy Strongly Disagree Somewhat Disagree Neither Agree Nor Disagree Somewhat Agree Strongly Agree Exposed Control

PP treatments had no detrimental effect on viewers perceptions of ITV as a well respected company…. Regular Coronation St Viewers Over 80% felt that ITV is a company that is well respected with 31% of those exposed strongly agreeing compared to 30% of the control. ITV is a Company that is Well Respected Strongly Disagree Somewhat Disagree Neither Agree Nor Disagree Somewhat Agree Strongly Agree Exposed Control

PP treatments had no detrimental effect on viewers perceptions of ITV as an honest company…. Regular Coronation St Viewers ITV is a Company that is Honest with the Public Two thirds of those exposed agreed that ITV is honest with the public (exposed). Strongly Disagree Somewhat Disagree Neither Agree Nor Disagree Somewhat Agree Strongly Agree Exposed Control

Summary

Summary – Viewer Experience • Relevant PP does not detract from or interrupt the viewing experience • It can add depth and reality (when done well) to a programme. • Around 2/3rds (68%) of viewers to treated episodes thought that PP was appropriate, and over half (59%) thought the brands fitted the programme, with a further 1 in 3 (27%) unaffected by the placements. • 91% of viewers to treated episodes, agreed that seeing the placements made no difference to their enjoyment of the programme • Overall, viewers enjoy PP’s, with the lack of disruption to the viewing experience being an important quality

Summary – Programme and Editorial Implications • PP must always fit the storyline – right time, place, product andprogramme. • 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 – there may only be a couple in a 30 min programme

Summary – Commercial Impact (1) • Unprompted spontaneous awareness was significantly higher for PP’s in episodes. • Brand metrics and attributes showed no significant changes (as expected) on a single placement. • 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 • Eye tracking confirms that viewers are clearly looking at placements • “Prop” placements are already being seen by viewers

Summary – Commercial Impact (2) • The ITVpp logo (alerting viewers to placements) in the credits, was recalled by 50% of viewers • Qualitatively, the role of the ITVpp logo needed explanation and some viewers thought it could make you look out for products. Overall, it needed to be low key and not detract from viewing experience. • There were no detrimental effects on the perception of ITV being “trustworthy”,“well respected” and “honest” with the addition of PP’s in the episodes.

Areas to Explore Further • Programme Genre’s and Product Placement • Creative and Executional Guidelines • Commercial impact of PP as part of a mixed media schedule • Long term PP effectiveness for Advertisers

Appendix Charts

Nielsen Methodology – Test and Control Pilot and Main study conducted by Nielsen linking through to hosted content on a “closed” site, designed to emulate ITV player. Matched Samples of Test and Control respondents viewed treated and untreated episodes of Coronation Street online as part of the survey process Email survey to Research Now panel Nielsen provides executive summary / consultation Clients receive top-line performance summaries to evaluate campaign and creative performance Exposed (and control) panelists are sent a survey to determine the brand impact Exposed asked to view an episode with PP and control the same episode without treatment

Nielsen - Research Sample Profiles

KAE Research Overview 2 Coronation Street episodes Friday 4th Dec: Special K and Listerine Monday 7th Dec: BT and William Hill • Coronation Street episodesand screen shotsprovided by ITV • Eye tracking testto determine whether respondents subconsciouslysee placements • Survey to test conscious awareness of placements and attitudes towards PP and ITV in general • Focus groups allow an in-depth understandingand further exploration of the limits of PP Eye tracking test 2 groups of 30 respondents Focus groups 4 groups of 8 consumers Older & Younger, North & South Eye tracking survey In-depth evaluation of product placement 42

Qualitative Approach: Group Discussions • All respondents were prompted to watch an episode of Coronation street prior to taking part in the groups and asked to complete a viewing diary recording their thoughts on the episode viewed • During the sessions we explored spontaneous awareness before re-playing relevant episodes and prompting respondents on the extent to which they were aware of the product placement Pre-Task Viewer Diary of PP Coronation Street episode 4 x 1.5hr Group Discussions (32 respondents in total) 2 x Pre-Family and Family 2 x Family and Empty Nesters • 25 to 44 yrs • 1 x Episode 1 • 1 x Episode 2 • 45 to 65 yrs • 1 x Episode 1 • 1 x Episode 2 Across all groups: • Mixed gender • Mix of BC1C2 social grade • All to be regular viewers (at least twice a week) of Coronation street • Mix of London and Leeds locations • 8 respondents per group 43 43

Eyetracking:The basics of how it works… Pupil marked as a dark spot Reflections on the cornea • The eyetracker shines low levels of infra-red light (14 times less than a typical remote control – so it’s safe) onto our test participant’s face • The surface of the participant's eyesreflects the infra-red light (in fact 2 points for each eye are reflected) • The reflections from each eye together with the dark image caused by light absorption by the each eye’s pupil are captured by a high-resolution digital camera • Some heavy duty maths works out where each eye was looking 50 times per second Integrated Eyetracker Eyetracker with stand 44 44

Eye tracking: process and respondent structure • Sample of 60 eye tracking respondents 28% Calibration 40% Stimulus Survey 40% 60% 32% 45

Eye Tracking : Beeswarm Example This Beeswarm example shows individual eye tracking respondents • Red dots are the respondents who, in the aided awareness question, said that they saw the Brand placement • Blue dots are the respondents who did not select Brand in the aided awareness question • In this example it can be seen that after the first placement some respondents started to look around more, particularly in the shop scene 46

Eye Tracking : Beeswarm Example 47

6% looked at the BT logo Additional BT PP Examples 10% looked at the additional logo 23% looked at the BT phone (Video 2) 30 participants, 1.7776s 7% looked at the BT booklet (Video 2) 30 participants, 1.6s 48

Prompted Recall by Placement Treatment Main Study (debranded) Regular Coronation Street Viewers (exposed) Notes: Exposed Group : Nielsen Quant Main Study 6 brands / 3 episodes

Brand Opinion by Placement TreatmentMain Study (debranded) Regular Coronation Street Viewers (exposed) Notes: Exposed Group : Nielsen Quant Main Study 6 brands / 3 episodes

Product Placement