TV Plugs Top $1.87B - Broadcasting & Cable

TV Plugs Top $1.87B

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Thanks in part to all of those American Idol Cokes and Extreme Makeover Sears appliances, TV plugs were a $1.87 billion business in 2004, up 46.5% from the year before.

TV accounted for over half of all product placements.

Overall, integrated product placements in TV, movies and the "other" category were valued at $3.46 billion, up 30.5% from 2004. That increase apparently came at the expense of traditional advertising, which only grew by 7%.

That is according to a new study from research firm PQ Media, which is plugging the study as the first to characterize the "size and structure" of integrated product placement.

PQ said the growing size of the market was driven by the ability of surfers and grazers to avoid traditional spots and helped by the proliferation of the plug-happy reality genre and by the emergence of  cable nets like Food Net, Outdoor and The Learning Channel.

Of the $3.64 billion product placement total, the majority (64%) were barter arrangements, where the product, say a houseful of Sears appliances or five Ford Focuses, was the payment. In a little under a third (29%), money changed hands, and in 7%, the plug was gratis, i.e. the product was simply used by the show.

The percentage breakdown for TV's $1.87 billion share is about the same, with $552.3 million paid, $1.21 billion barter and $118.4 million in free plugs.PQ predicts that plugs will grow at a compound rate of 14.9% annually through 2009, which would put the category at $6.94 billion in 2009. TV's share will grow to 61%, prognosticates PG.

An executive summary of the report is available at www.pqmedia.com.

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