Why George Osborne is good for product placement
The last few weeks have seen high profile changes in British production finance and NMG’s John R Barnard believes these will have a significant and beneficial impact on the UK product placement market – opening the doors to UK marketers looking for quality brand integration in long shelf-life films and TV dramas that will travel the world.
Last month George Osborne announced a new series of “Creative Sector Tax Reliefs” following on from the previous scheme that benefited over 1,000 films with a value of £800+ million. Osborne has now extended the tax credits to TV high-end drama and animation and plans not to stop until video games are included.
The Chancellor says the new tax reliefs are among the “most generous now available in the world”, and that “one pound out of every ten” that the UK generates through exports is generated through the sector.
Then, on May 10 Osborne tweeted: “Just confirmed: the next Star Wars film will be made in UK. Great news for our creative industries. May the force be with us.” It’s a good time for our creative industries.
From April 1 2013 the new tax breaks are available for UK produced British television dramas with BBC One’s police drama By Any Means, currently in principal photography, is believed to be the first production to benefit.
But the bar has been set high. Productions will only be able to benefit from the new tax breaks provided they satisfy a cultural test and have an average core expenditure of £1 million+ per hour.
To put this in perspective, take a look at the BBC’s Commissioning Tariff Ranges. They go from £50,000 to £500,000 per hour for daytime and low cost dramas, through mid-cost drama and on to high cost drama at £700,000 to £900,000 per hour ending with Premium Drama at £900,000+.
So where are the opportunities? Many will dismiss Star Wars VII as being unsuitable for product placement – and fair enough, it is set a long time ago in a galaxy far, far away – but big budget films being made in the UK signals a new era for our creative industries.
In turn, product placement opportunities for brands will be far reaching.
With its attendant promotional exploitation, product placement is a wide-ranging tool. However, there is no ‘one size fits all’, which is why agencies like NMG exist; to help guide, interpret and exploit opportunities within this highly specialised world.
Take a brand like Beats, the headphone and speakers designed by Dr Dre, who will consider appearances on low budget, hand held music videos with passing late night exposure on MTV or VH1 as “job done”. Quite right.
However, quality British TV drama productions with their attention to detail and contemporary realism provide some of the best opportunities for seamless brand integration for iconic brands.
Further, as demonstrated in NMG’s research in November 2011, quality British TV drama exports around the world.
Working with media evaluation firm Madigan Cluff and specialist TV tracking company ETS, NMG found that the media value of just one of our placements in a specific episode of ITV’s Lewis increased by 193% in the first 12 months of release due to coverage in prime-time overseas broadcasts.
We also tracked an episode of ITV’s Midsomer Murders, which in a 12-month period aired in 13 countries, including Australia, Germany, Italy and Sweden. Over 70% of these transmissions were in peak time.
Our recent UK product placement market forecast 2013/14 pointed out that films offer global audiences, low or no upfront fees, editorial influence, are regulation free and lead times to plan fully integrated PR and promotions.
Courtesy of George there will now be more quality films made in the UK making them easily accessible to UK marketers.
Likewise, the BBC now defines high and premium cost dramas as including a large cast, stunts, foreign locations, CGI and significant special effects, or part of Bank Holiday or landmark events.
High value productions – that’s where the clever brands will want to be.
Thus, if a six figure “paid for” deal in, say, Channel 4’s Hollyoaks doesn’t work for your brand, prop provision (also known as free prop supply and used, carefully, by the BBC) can achieve appearances in these top quality, exportable, long shelf-life dramas funded indirectly by the tax credit scheme.
Multi-million dollar films or high end top drama – it’s a win-win for UK product placement and UK marketers. After 29 years in the business, this has to be one of the most exciting times ever for NMG.
John R Barnard is non executive chairman of NMG Product Placement at Pinewood Studios