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A combination of two existing marketing practices—product placements and personalization—suggests a new leading edge for advertising. Specifically, streaming services such as Netflix and Hulu are gearing up to help advertisers personalize their communications not just during breaks between shows but even during the show itself.

The personalization would reflect various consumer data. If one viewer is watching a streaming show in the morning, the lead character might be depicted eating cereal. If another is watching late in the evening, that very same character, in the same scene, might appear to be chowing down on ice cream instead. In addition to timing, the placements could vary with consumer preferences, such as whether the viewer is more likely to respond to a chase scene populated by sports cars or SUVs.

These insights are uniquely available to streaming services, which constantly collect data from viewers as they interact with the service. The streaming services already use them to design the advertising that appears when a user pauses a show or in between episodes. For example, if a consumer watches more than three episodes of a show during one sitting, Hulu will queue up advertisements for Kellogg’s, with the anticipation that this binger might be ready for a little snack.

Other experiments are even more interactive. On Netflix, viewers of Bandersnatch had an opportunity to click to decide which of two cereals would appear in the background of a scene taking place in a kitchen. The preferred choice then appeared as part of the scene, later in the program. Such insights are deeply valuable for advertisers, but they also promise to engage users more with the program. Instead of just watching passively, they can signal their preference, in a game-like setting, then have the fun of seeing their choice pop up just a little later.

Alternatively, on Vudu, which is owned by Walmart, the interaction can be even more direct. The service features “shoppable ads,” so that smart television users can click a purchase button on their screens during advertisements for various products. The click automatically enters the item into their virtual shopping cart on Walmart.com, such that they do not even need to switch to their phone or computer to make a purchase of something they find appealing.

The promise of further developments suggest they will probably be less evident and more understated than these existing examples. Because these service providers already possess so much data about consumers, based on their activities and choices, they can work in subtly to design content that explicitly appeals to consumers. A billboard that appears in the background of an outdoor scene in a popular show thus might change for each viewer, serving up a unique advertisement for the most relevant offerings for each person. Will such novel and seemingly subtle targeting be the advertising of the future?

Discussion Questions:

  1. How does this modern version of product placement differ from traditional, historical uses?
  2. Beyond consumer goods firms, what kinds of marketers might be interested in gaining insights into how to perform personalized product placements?

Source: Tiffany Hsu, “You See Pepsi, I See Coke: New Tricks for Product Placement,” The New York Times, December 20, 2019