In Search of Lost Time

Today, there are product-placement specialists, such as Frank Zazza, the C.E.O. of iTVX, a Westchester-based firm. The studios and television networks employ people to negotiate placement deals. There are no set fees, but the size and demographics of the audience matter; a quick shot of a company’s logo in a movie can fetch from ten thousand to ninety thousand dollars. Placements are negotiated individually, with payment going not only to a network or a studio but to the producers who integrate a product into their script. A thirty-second commercial on “Desperate Housewives” would cost up to four hundred thousand dollars, Zazza says, while a product placement on the same show—if it lasted about twenty seconds and was part of a script—could cost advertisers the same amount. Product placement may also consist of giving away cars on “Oprah.” Last year, General Motors’ Pontiac division gave away two hundred and seventy-six cars on the show. A single thirty-second ad on “Oprah” costs about seventy thousand dollars; Zazza estimates that the publicity value to Pontiac was worth at least seventy million dollars.

This year, Zazza told me, a billion dollars will be spent on product placement in the United States, up from half a billion last year. Next year, he guessed, the figure will double again, coming to represent a fifth of what is spent on all network television advertising. The challenge for agencies is to figure out how to replace the fees they once earned on thirty-second spots. One method is for advertisers to invest aggressively in programs where they have some control over the scripts. On behalf of Sears and Unilever, for instance, MindShare, WPP’s media-buying arm, has joined with ABC to develop comedies and dramas and share in the profits.