Britain approves TV Product Placement

Product placement will be permitted in UK television programs, the government has confirmed after a three-month consultation. Culture secretary Ben Bradshaw said the government would adopt existing EU legislation to allow broadcasters to tap into the “meaningful commercial benefits” it could provide.

In a written Ministerial statement Mr Bradshaw said the UK and Denmark were currently the only EU states to not allow product placement and the government could no longer justify banning the practice amid faltering conventional advertising revenues for broadcasters.

The new legislation, which will see the EU Audiovisual Media Services Directive on TV Product Placement adopted into Section two of the European Communities Act 1972, will not apply to licence fee-funded BBC output or children’s TV programs.

Although a small number of products will remain prohibited from being advertised in programs, including alcoholic drinks, food and drinks high in fat, salt or sugar, gambling, smoking accessories and over-the-counter medicines, all major FMCG, CE, fashion, financial services and automotive categories will be free to use this new form of paid advertising.

The new rules will help strengthen the economic base of Britain’s audiovisual industry, thanks notably to more flexible rules on TV advertising, as well as the recognition of new forms of dynamic advertising such as on-demand, interactive, 3D and TV Widgets.

It also opens up new revenue sources for Europe’s audiovisual producers for gap financing and will help boost Europe’s creative economy and reinforce its cultural diversity. We estimate that product placement in the UK alone will generate as much as £200m a year in production revenue.

After the new legislation comes into effect, Ofcom will then hold its own public consultation on the issue.

James Grant Hay is a leading brand integration and content strategist and regularly advises rights holders and advertisers internationally on the value of television properties for the purposes of product placement and brand sponsorship.