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Branded Entertainment Set to Surge

December 8, 2010

Branded Entertainment Set to Surge

Increased spending in the sector is expected to continue unabated

– Katy Bachman, Mediaweek

Branded entertainment marketing dipped for the first time in 2009, but it’s forecast to roar back this year, according to PQ Media’s new report on the industry released today. In 2010, branded entertainment — including consumer event sponsorships, event marketing and product placement  — is quickly becoming a staple of advertisers’ marketing plans, on track to total $25.93 billion, a 5.3 percent gain.

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Consumer event sponsorships and marketing, the largest segment of brand entertainment, is forecast to grow 5.1 percent in 2010 to $22.1 billion. Product placement in media such as TV, film, online and video games, will be the fastest-growing segment, up 6.2 percent to $3.8 billion.

The gains follow a 1.3 percent decline last year to $24.63 billion, the first decrease since PQ Media began tracking the industry in 1975 — and the first decrease following four consecutive years of double-digit growth. Consumer events, the largest segment of branded entertainment declined 1.1 percent to $21.01 billion last year, while product placements dropped 2.8 percent to $3.6 billion.

Though branded entertainment was not immune from the recession, it wasn’t hit nearly as hard as other media, setting the stage for a rapid recovery.

“Branded entertainment is emerging as a leading alternative media strategy,” said Patrick Quinn, CEO of PQ Media. “Brands and their agencies have been forced to rethink a lot of their long-held strategies.

He added: “The difficulty of reaching more elusive target consumers, and the transformation of personal communications due to these developments have made it more important than ever for brands to invest in strategies to engage target consumers in captive locations for extended periods of time through the power of emotional connections.”

Secular shifts driving the increased spending are expected to continue unabated. By 2014, branded entertainment will reach $38.16 billion, growing at a 9.2 percent compound annual growth rate. Consumer events spending will grow at an 8.8 percent rate during the period, while paid product placements will increase 11.1 percent.

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