Product Integration Is Putting Brands Where Customers Can See Them

Consumers have switched off their TVs and turned to ad-free streaming in droves, so how can advertisers make the impact they used to? In this episode of Mastering Innovation on Sirius XM Channel 132, Business Radio Powered by The Wharton School, Gary Shenk (G’97), Founder and Executive Chairman at Branded Entertainment Network (BEN), discussed how BEN became the global market leader in branded product integration as well as the trends that enabled the widespread appearance of brands in media.

Traditional advertising is rapidly declining and streaming has captured the world. Brands have also become ubiquitous, and content producers seek to include them in their programming to appear authentic. This is where BEN steps in to help brands seamlessly place themselves in entertainment at scale. They have worked with Zillow, Microsoft, Cadillac, and others.

Some of BEN’s innovations include a pricing model based on how a brand appears in a show and the ability to measure valuable data about affinity towards a brand, purchase intent, and conversions. The measurable impact they provide to customers is key to their over 90% retention rate. This year alone, they are doing over 6,000 integrations with over $1.2 billion of media value. Shenk predicts product integration will be a big part of the advertising landscape in the coming years, with BEN at its forefront.

An excerpt of the interview is transcribed below. Listen to more episodes here.

Transcript

Gary Shenk (Founder and Executive Chairman, Branded Entertainment Network)

Harbir Singh: Tell us more about the business that you do. I’m really fascinated by it, but I want our listeners to hear exactly what the new innovations are.

Gary Shenk: Branded Entertainment Network (BEN) is the global market leader in what we call branded product integration, what the world usually knows as product placement. We put brands into entertainment across the entire entertainment ecosystem. So, we put brands on average 13 television shows on broadcast premium cable every single day. We put brands in all of the shows on Netflix, Amazon, Hulu, and streaming networks. We put brands into 90% of Hollywood movies and we put brands into about 50,000 social video channels on YouTube, Instagram, and other social video networks.

We’re the only company that allows a brand to say, “I want to be across the entertainment ecosystem and I want to do that in a completely frictionless way.” So, we took a very high-friction business historically, which was product placement, where one brand would say, “Oh, I want to be in that movie or that TV show,” and it would be a one-off campaign. Now, we are really allowing brands to do this on an ongoing way at scale across all types of entertainment.

Singh: What has enabled or enhanced this trend of brands becoming more ubiquitous in entertainment? I’ve noticed that in a somewhat seamless way. Can you speak to that? On one hand more placement, on the other hand, the challenge of seamlessness.

Shenk: Yeah. I mean, I think that there’s two things that have really changed. First of all is that traditional advertising is declining in an incredibly rapid rate. Streaming is really taking over the world. We call it the ad-free universe. You look at the amount of views that are happening on Netflix and Amazon and the ad-free streaming environments. And then on YouTube, there is advertising on YouTube, but most people skip it. So millennials are watching most of their entertainment in ad-free viewing environments. Traditional advertising is really declining and CMOs are challenged to actually find new ways to be out there front and center with consumers. And one of the ways that we’ve innovated is finding ways to allow brands to place themselves at-scale inside the entertainment where the eyeballs and the viewership guarantee that the brand will get seen.

“Traditional advertising is really declining and CMOs are challenged to actually find new ways to be out there front and center with consumers.” — Gary Shenk

The second thing that’s happened is producers really embracing integration like never before. Historically, product placement had a stigma attached. It was very audacious in the way that it was implemented from a brand perspective. Even movies like “Austin Powers” have made fun of the industry by putting the product placement almost as a joke inside the content. But in today’s world, brands are ubiquitous. Starbucks is everywhere, Apple is everywhere, Google is everywhere. Brands are part of the landscape. So, in order for programming to be authentic, it really has to have the brands in it. If you’re watching a show and a character is drinking no-name soda or a character is driving a no-name car, and the logos are blurred out, it really disrupts the viewing experience.

So, I think over the last 10 years producers have really seen products in their shows less as a money-making opportunity. It is an incentive for them to put brands in the show in that it does bring money into production, but the real reason that they’ve embraced it is that it adds authenticity to the programming. And so, BEN’s model is to really give producers free reign to incorporate brands into their programming how they see fit. They know how to weave the magic on screen and so, they’re going to know how to use brands to connect to their audiences. The way that you ensure that authenticity is by giving the producers and the creators the authority to integrate the brand in a way that’s going to be seamless.

Singh: That’s really interesting. What I’m wondering about was clearly the no-name car and so on, we don’t see that anymore or we don’t see the generic products as such. But then there’s a question of being more overt versus being seamless, and maybe one level below that being subliminal. So, where do we kind of come out on that? And how do we pre-determine or do we recalibrate? For the television show, I can imagine we recalibrate. But in a one-off production, it may be harder. And of course, this is something I’m sure you guys have plenty of answers to. How would you think about that?

Shenk: For BEN, seamless and authenticity are table stakes. If a brand wants to go beyond and assert itself beyond authenticity, then we’re not going to do the placement just because it’s not going to work. If a placement is too overt it actually has a negative impact on the brand. So, it has to be authentic to have its magical power. We have all sorts of metrics that show that product integration is superior in terms of its impact on the viewer to traditional advertising. And one study after another shows that. But I think that, you know, to your point there are levels of integration that happen within a particular show.

“This market is evolving very, very quickly … But it still has a long way to go and we’re at the very beginning of the runway.” — Gary Shenk

In some cases, there’s overt verbal mentions — Zillow was a client, for instance. Zillow is a tough product to show, to weave into a show because it’s an app and it’s not inherently visual like a car or like a beer can. And so, Zillow really needs that home buying moment in the show. And in that moment ideally, they’re talking about Zillow. There’s a verbal mention of Zillow in the show. That’s a very, very premium immigration, but we’ve kind of created a spectrum and we call it premium, prominent, and standard.

Premium is what I just said where there might be a verbal mention, there’s a lot of time on screen. It’s really front and center in terms of the creative. Prominent is less so, but there’s still a significant placement and appearance on screen. And then the standard might be just a background object that appears, that is to your point is more subliminal in the way that it’s seen, but it is seen according to the studies that we run. And so, how BEN innovated is by creating a pricing model that really prices based on those different variables of how the product is going to appear in the show. Your brands will pay more to get the premium placement. They’ll pay less to get the standard placement.

Singh: There’s a spectrum. And as you were talking about this, what I was thinking about was: what variation do you see in competence of your clients who understand what the instruments are? Some might be right at the very top and others may need to actually first learn about what you do so they can make the most of it.

Shenk: Yeah. That’s really astute because that’s exactly the way the landscape is. We’re really at the top of the first inning in terms of the emergence of this market. We think that this market is going to be a big part of the advertising landscape in the coming years. If you remember digital, desktop internet, and then mobile internet, it takes a long time for the advertising to reach an inflection point. We’re doing over 6,000 integrations this year with over $1.2 billion of media value. So, this market is evolving very, very quickly and emerging quickly. But it still has a long way to go and we’re at the very beginning of the runway.

About Our Guest

Gary Shenk is the Founder and Executive Chairman of the Branded Entertainment Network (or BEN), a Bill Gates-owned company and a global leader in Entertainment Advertising. From starting two successful newspapers in his twenties, to founding three groundbreaking entertainment companies, Gary’s entire career has been about building successful, high-growth media ventures that anticipate future trends and capitalize on emerging opportunities. Prior to BEN, Gary was the CEO of Corbis, the world’s largest global image archive, and the General Manager of FlixMix — a subsidiary of Universal Pictures and one of Hollywood’s leading licensing agencies. Gary began his career as a Project Leader in the Media and Entertainment practice of The Boston Consulting Group. He’s a graduate of Harvard College and the Wharton School.

Mastering Innovation is live on Thursdays at 4:00 p.m. ET. Listen to more episodes here.

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