Product placement: Now you see it...

Ofcom has regulations to prevent forms of product placement but, as Alex Benady discovers, they mean very little in practice

In theory, at least, the worlds of television and advertising should have been "rocked" by revelations last month that companies regularly pay to promote their products covertly on BBC programmes in clear contravention of the corporation's rules on product placement. The suggestion that products appear in programming for commercial reasons is a severe blow to the credibility and integrity of the BBC.

The BBC duly registered its surprise and immediately launched an investigation. But the rest of the industry scarcely raised an eyebrow - largely because such practices in both the BBC and commercial TV are an open secret in the industry. "It has been so widespread for so long it's hardly worth remarking on any more," says one senior independent producer.

The current Ofcom and BBC rules on product placement are a sort of Maginot line, say many in the industry: they look very formidable in theory but in practice there are many ways round them. The easiest way to get your brand on TV, say industry insiders, is to play it straight. Ofcom regulations don't ban the use of brands and products; they simply prohibit paying for placement and what they call "undue prominence" in their use. So it is quite legitimate to sign up with one of a number of props companies that help television and film productions to source goods for productions. The brand owner might pay the props company £20,000 to represent their products, but no money changes hands between the brand owner and production company or broadcaster.

Some canny brand owners have been known to take the props game a stage further. One baker simply ensured that its products were prominent in every grocer and convenience store within a 10-mile radius of the studios where a major soap was made.Alternatively, a brand could approach a TV station's events sponsorship department, particularly if it wants to appear on the BBC. "Whenever we investigate sponsoring a TV station event, there is invariably a side conversation in which the amount of on-air exposure and specific verbal mentions are discussed," admits one ad agency sponsorship specialist.

If that doesn't work, there's always try PR. Daytime chat shows in particular will merrily run "consumer" stories about research revealing new social trends sponsored by the beneficiaries of that trend.

A related approach is to supply prizes for competitions. In years past the suppliers of prizes were acknowledged only in the vaguest terms. Now it is common for them to receive praise for their generosity, not to mention detailed on-air product descriptions. Failing that you might take your budget overseas. Do you remember Carrie typing on her Apple PowerBook in Sex and the City? Making the brand an integral part of the plot - product integration - is reckoned to be the most effective form of product placement. It's not allowed here but it is in the US, so it can be used for funding American productions bound for the UK.

The same applies to feature films and programmes broadcast on the internet. There are no rules governing commercial influence on films.

If your product is content - perhaps music or a film - the current regulations offer much freedom. On-air promotions such as a Spider-Man weekend or Stereophonics day are indistinguishable from news or entertainment although they may be considered to be advertising.

But probably the most effective method is to make your television programme before you launch your product. That way you can almost do whatever you like. The practice of selling cartoons cheaply prior to a product launch has become almost standard in the toy industry.

While advertisers, TV production companies and TV stations all benefit from these activities (in the short run at least), it puts the onus on viewers to decode the commercial agendas. That is why, perhaps surprisingly, brand owners are very keen that television programming doesn't descend into a commercial free for all.

"Trust is the very thing that makes television so powerful and so commercially attractive. It is in no one's interest to destroy it. So we do need some regulation," says Mark Boyd, head of content at advertising agency BBH. "We certainly we need greater transparency in product placement."

But the bottom line is money, he says. If you watch any peak-time show tonight, particularly an American import, say, on Channel 4, the show would cost you between £6 and £10. "Advertising subsidises all of this and the show is free to you. If people are more difficult to target with traditional ads, viewers and the TV businesses have a stark choice: find new opportunities for advertisers or start paying for TV directly."

John Nolan, head of commercial programming, at independent production company North One, agrees. "The current regulations do not reflect the commercial reality of television funding, and any change in the regulations which increases funding through non-traditional routes would be very welcome," he says.

It's an argument Ofcom might care to consider as it embarks on a study to examine the feasibility of using product placement as a legitimate means of funding commercial television. Consultations are due to start before Christmas.