Product Placements Make Their Way Onto Viral YouTube Videos

By Madeline O’leary
Los Angeles Times.

YouTube stars are borrowing an idea from Hollywood’s Golden Age: product placement.

Think how General Motors sponsored comedian Bob Hope’s variety show, Revlon backed the 1950s game show “The $64,000 Question,” and Milton Berle hosted the “Texaco Star Theater.”

They all made money by infusing products and brand names right into the shows.

Taking their cue from TV‘s pioneers, the celebrities behind viral videos on YouTube are making deals with sponsors who pay from $5,000 for single videos to just under $1 million for larger campaigns.

Digital audiences get turned off by traditional commercials, and YouTube personalities won’t make anything that would drive fans away.

“We couldn’t run the business without brand deals,” Rhett McLaughlin said. “They’re realizing that creating engaging content with their brand integrated is more effective than making a commercial.”

McLaughlin and Link Neal, who have a combined 5.4 million subscribers on their YouTube channels “Rhett & Link” and “Good Mythical Morning,” have inked 15 brand deals in the last 18 months. They have worked with major companies such as Buick, Choice Hotels and Gillette.

The duo keep their audience by telling potential sponsors that their “YouTube channel is not a platform for your commercial.” In a “Rhett & Link” collaboration with Gillette, the razor doesn’t appear until the final 16 seconds of the two-minute video titled

“Kissing Your Face: What Women Really Think.”

“A television spot is temporary, but product placement lasts forever,” said Mark Owens, executive vice president of the Branded Entertainment Network, which connects brands to projects. The service is owned by Bill Gates’ Corbis Corp.

Only 2 percent of U.S. ad budgets is spent on product placement, according to data provider PQ Media. But that is starting to change as dollars drift to digital entertainment from television.

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