How Content Owners & Media Companies Gain a Competitive Advantage with Virtual Product Placement

Content owners are facing fierce competition. Here's how they win with virtual product placement. 

Revenue. Viewer loyalty. Scalability. These are the three key elements to a content owner's success. Therefore, delivering the ultimate viewer experience while driving revenue and balancing strategies for profit growth is critical for media companies. That’s why AI-powered virtual product placement (VPP) is the ultimate solution for content publishers. It aims to meet key performance indicators (KPIs) and thrive in a crowded market.

WHAT IS VIRTUAL PRODUCT PLACEMENT?

Virtual product placement (VPP) is a forward-thinking strategy reshaping how media companies generate revenue, enhance the viewer experience, and integrate advertising seamlessly. This ad format isn't just a new tool in the marketer’s arsenal; it's emerging as the cornerstone of a modern, audience-first approach to content creation and monetization.

We're looking at virtual product placement as the new antidote to ad fatigue and media inefficiency, delivering high effectiveness and driving viewer loyalty and affinity.

— Sparsh Pandya, Senior Client Director at Kantar

WHAT IS VIRTUAL PRODUCT PLACEMENT'S ROLE IN THE MEDIA INDUSTRY?

At its core, virtual product placement serves many purposes in the media industry. It offers an innovative way for content creators to drive revenue without compromising on the quality of the viewer experience. VPP also drives exceptional results for advertisers (as high as a 35% increase in sales following an exposure). And in an era where audiences are increasingly averse to traditional advertising, VPP is inserted naturally and contextually. 

This is what makes virtual product placement a game-changer. The ad format fits perfectly within the industry's need for revenue generation, optimal user experiences, and innovation.

HOW DOES THIS TRANSLATE TO MONEY FOR MEDIA OWNERS?

Media companies face rising costs from creating extensive content while managing a softer advertising market. Many are also experiencing greater churn in streaming subscriptions and continued cord-cutting. Plus, the lower number of ads served per hour significantly challenges profitability.

Mirriad’s virtual ad solution unleashes new revenue streams for streaming companies and media conglomerates by allowing them to monetize their content more effectively. Audiences are spending the majority of their viewing time watching content compared to the subsequent ad breaks. Therefore, leveraging virtual ads in the content itself is a way to generate substantial revenue outside of traditional methods. As the industry shifts from traditional ad-focused models and explores new ways to generate income, alternative monetization solutions are a critical need.

In a recent interview with industry analyst Brian Wieser, Mirriad’s CEO, Stephan Beringer recently explained the concept:

We help maximize the value for everyone.  For the TV networks with 6 to 12 additional ad opportunities per hour of content, we can boost ad revenue up to 50% in TV, CTV, and AVOD, and generate a 100% increase in ad revenue for SVOD. For advertisers who really want to make TV work hard and get into VOD at scale, we create all of these new opportunities. Ad-supported TV may decline as you describe it, or it might find new ways to grow, but either way, we think there’s a huge runway for these new ad units.

— Stephan Beringer, CEO at Mirriad

AWESOME. NOW WHAT DOES THIS MEAN FOR THE VIEWER EXPERIENCE?

An incredible aspect of VPP is its ability to create a win-win scenario for viewers and brands alike. For viewers, virtual product placement enhances the watching experience by integrating ads that are highly contextual. The ad format is also seamlessly blended into the content, reducing ad fatigue and driving loyalty and affinity.

Independent research consistently proves this. From a few of our recent studies with Kantar and Dynata, viewers have strong positive perceptions of virtual product placement. Let’s take a look at the research:

• Virtual product placement is liked by 75% of viewers on average (Kantar). In a recent Toyota campaign, the format was liked by 80% of viewers and drove 94 Ad Awareness. (Dynata)

• 83% of viewers agree that virtual integrations feel natural and 79% say it is non-intrusive (Kantar)

• Virtual product placement and in-content ads are preferred 10X over traditional ads (Nielsen)

The research is clear: virtual product placement is highly preferred among audiences universally.

WHAT DOES VIRTUAL PRODUCT PLACEMENT DO FOR BRANDS?

Virtual product placement consistently proves highly effective for advertisers, driving positive results across all categories. 

Virtual integrations drive a 25 ppt increase in ad awareness compared to traditional ads. Additionally, they drive a 23% higher reach when compared to TV spots. Some of the biggest advertisers are already achieving high results, driving up to a 35% increase in sales following virtual product placement exposure.

This underscores the outstanding effectiveness of virtual product placement and its ability to reach target audiences with immediate impact, underscoring its real-time influence on viewers. A great example is our newest research just announced in partnership with Toyota.

PROGRAMMATIC OPPORTUNITIES: PERSONALIZATION AND SCALING

Virtual product placement is not just about placing products into content. Most importantly, it's about doing so in a smart, scalable way through programmatic technology. As a result, brands achieve personalization to target specific audience segments with tailored ads that resonate with their interests and viewing habits. 

HOW IS THE MARKET ADAPTING TO VIRTUAL PRODUCT PLACEMENT?

Within the last few months, Mirriad is gaining strong traction among major media companies, most recently signing a partnership with a leading US entertainment conglomerate. Mirriad has a wide portfolio of over 60 partners also including a Diverse Supplier Marketplace which expanded by 50% in 2023.  

INCREASE REVENUE NOW WITH MIRRIAD

Virtual product placement is more than just an ad format; it's a strategic advantage in the competitive media landscape, offering a way to drive revenue, enhance viewer experience, and engage audiences in a meaningful way. For content owners looking to gain a competitive edge, embracing this ad format is not just an option; it's a necessity.

If you're ready to unlock the full potential of your content and explore the transformative impact of virtual product placement, we invite you to contact us or visit our Content Owner page. 

Together, we can redefine advertising, elevate the viewer experience, and drive unprecedented growth for your content. Join us in shaping the future of media.

This article was co-authored by Mirriad's Karen Magnani, SVP of Business Development.