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Music Industry Goes Gaga for Product Placements

Posted by Sheila Shayon on July 6, 2010 12:30 PM

Lady Gaga has given a boost to Virgin Mobile and Miracle Whip via her video hit, Telephone, which has already been viewed 63 million times on YouTube. There’s nothing new to product placements like these – but what is new in this growing trend is the prominent positioning of brands in a clear bid for additional revenue.

Fueled by the growing shift from TV to Web viewing of music videos, record labels are now bullish on product placement as a gimmick to draw brands to advertise and consumers to buy. No longer just a sales tool for promoting a CD release, in-video products are, to borrow the singer's favorite word, a "monster" business.

And when you consider the power of her personal brand--Gaga now has more Facebook fans than any other living person--then the power of association becomes even more potent for the brands she's cozying up to in her videos.

In-video product placement revenues totaled $15-$20 million last year, more than double the amount in 2000, according to PQ Media, and spending by the music industry on that brand marketing opportunity increased 8% last year. Patrick Quinn, CEO, PQ Media, tells today's New York Times, “That real estate — getting into the content itself — has become that much more valuable. There’s an opportunity there to make money and charge for that real estate.”

When music videos were primarily shown and viewed on television, product placement was called “integration” and closely monitored by networks like MTV, whose "policy prohibited blatant plugs in videos, so the network would often blur brand labels or ask for a new version without the placement." (Remember how many hip-hop and rap videos blurred logos on t-shirts and baseball caps?)

But as MTV turned to reality programming and stopped emphasizing music videos, the gap was quickly filled by labels and advertisers shilling on the web. “Before, video was definitely to showcase creativity and content. It was promotional, and today we look at video as another piece of pie and a way to generate venue,” commented Jonathan Feldman, VP of brand partnerships for Atlantic Records.

The pitch to advertisers today is to leverage the long tail of product placement through music videos, as opposed to an annoying pre-roll ad before the video which lasts for 15 seconds and then is gone.

As this opportunity for additional revenue meets the creative fuel behind most music videos – the resultant artistic combustion has begun to integrate the brands more fully -- as part of the gimmick. Feldman did say that the musicians have final say about a product’s inclusion – and that Atlantic has rejected several opportunities that would not have "appeared natural."

Lady Gaga's 9.5-minute video for Telephone includes 10 product placements and generated more than 4 million views in its first 24 hours. Pass the mayo!

Comments

Josip Petrusa Canada says:

What's interesting is that music videos don't have to rely on their MTV success. YouTube is the new indicator of music success and with that watch product placement to increase as the numbers on YouTube are quite significant.

July 6, 2010 01:23 PM #

Comments are closed

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