Stamford, CT – August 19, 2010 – Despite the worst global advertising recession since the Great Depression, spending on product placement in European media remained steady in 2009 and is on pace to grow at a double-digit rate from 2010 to 2014, according to exclusive research released today by PQ Media, the world's leading provider of alternative media econometrics.
Total spending on product placement in Europe – including television, films, internet, videogames, recorded music and other media – was essentially flat at $610 million in 2009, but is poised to grow at a compound annual growth rate (CAGR) of 18.2% in the 2009-2014 period, according to the fourth edition of the PQ Media Global Branded Entertainment Marketing Forecast 2010-2014 (http://www.pqmedia.com/brandedentertainmentforecast2010-read.html). Global product placement spending – including North America, Europe, Asia and other regions – dipped 0.3% in 2009 to $6.25 billion, as the U.S. market declined 2.8% to $3.61 billion, the first decline in product placement spending since PQ Media began tracking the industry in 1975. The U.S. remained the largest market, and strong double-digit gains from 2005 through 2008 drove double-digit growth during this period.
While product placement spending decreased slightly in 2009, primarily due to the massive economic recession, it was much less affected than traditional advertising and marketing spending, which declined at double-digit rates worldwide. And the European markets are primed for strong growth over the next several years, according to PQ Media.
"Despite the cyclical decline in global product placement spending in 2009, driven primarily by the severe recession, the secular trends favor the resumption of relatively strong growth for this marketing strategy going forward," said Patrick Quinn, CEO of PQ Media. "Our research indicates that a marketing strategy which empowers brands to develop emotional connections with target consumers through desired entertainment content will continue to receive a growing portion of marketing budgets."
Product placement has been more controversial in Europe than in the U.S. due to a history of stricter advertising regulations. However, as a result of declining government outlays, competition from rapidly emerging digital media and growing DVR penetration, the European media industry – particularly television and film – have increased pressure on the European Union and individual regulatory agencies in various countries to loosen restrictions. The E.U. recently passed law allowing a mix of editorial and advertising under certain conditions, while allowing member countries to write their own rules. The E.U. also made clear that product placement must be transparent to viewers at the start and end of TV programs and commercial breaks, while forbidding tobacco ads and banning placements in children's programs, documentaries and news programs.
While OfCom in the U.K. has proposed a new set of looser regulations that are expected to be approved in some form this year, France and Spain have already marched forward. France is already the largest European market for product placement in all media, followed by Italy, the U.K., Germany, Spain and Russia, although Russia is the fastest-growing market. Germany has been one of the most vocal opponents of relaxed product placement rules on TV and, as a result, placements tend to appear mostly in film and other media. PQ Media predicts total product placement spending in TV, film, internet, videogames, recorded music and other media will grow at double-digit rates in each of the leading European markets in the 2009-2014 period, particularly from 2011 to 2014, driven by wider acceptance of more liberal rules. France will remain the largest European market in 2014 at $283 million, followed by the U.K., while Russia will be the fastest-growing market with a 31.2% CAGR, followed by the U.K., according to the PQ Media Global Branded Entertainment Marketing Forecast 2010-2014
A free executive summary of the PQ Media Global Branded Entertainment Marketing Forecast 2010-2014 is available for download and the full report is available for purchase at http://www.pqmedia.com/brandedentertainmentforecast2010-read.html
PQ Media (www.pqmedia.com) is the world's leading provider of media econometrics and pioneer of alternative media research. PQ Media delivers actionable strategic intelligence to the world's leading media companies, financial institutions, management consulting firms, media agencies and brands. PQ Media's proven and respected consulting services and research reports have empowered its clients with exclusive data and insights on media spending, usage and trends across all 20 major segments and more than 100 sub-segments to effectively navigate a rapidly changing media landscape. PQ Media also partners with Veronis Suhler Stevenson on the renowned VSS Communications Industry Forecast, the industry's benchmark for spending, consumption and forecast data for 24 years.