Product Placement
July 13, 2025
Last night, I went to the movie theater for the first time in several years. I’m a big fan of watching movies from the comfort of my home, but as Formula 1 fans, my wife and I decided to go out for date night to see F1: The Movie. It was fun. Aside from enjoying the very Hollywood story and the real F1 cameos, what stood out most was how realistic the fictional team felt, thanks largely to the sponsors.
The APXGP car driven by Brad Pitt was covered in actual corporate logos, just like actual F1 livery. Expensify, SharkNinja, Geico, EA Sports, Tommy Hilfiger, and IWC reportedly paid a combined $40 million for the rights to sponsor the fictitious team. Nearly every square inch of the car doubles as rentable ad space, blending art, commerce, and carbon fiber in one of the most overt product-placement showcases ever made.
This isn’t just a fun gimmick. It’s a blueprint. As streaming growth slows and content budgets stay tight, brands and studios alike are turning to integrated marketing as a way to fund big productions and monetize back-catalogues. Whether it’s Apple producing the movie or Louis Vuitton designing the real-life F1 podiums, product placement has gone from a background prop to a core revenue strategy. In fact, product placement can even be added post-production to advertise specific products to specific audiences. With these innovations, this once niche advertising strategy is expected continue growing steadily in the coming years (see chart below).
Product placement is attractive as an advertising strategy for several reasons:
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Unskippable: placements are embedded in the content, impervious to ad-blockers
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Authentic context: viewers see products in use, not just on display
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Long shelf-life: digital props can be inserted or refreshed long after a scene is shot
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Revenue unlock: transforms back-catalogues into dynamic, monetizable ad inventory
The companies that are most poised to benefit from this innovation are the streamers and studios that can monetize libraries with placements and the digital agencies powering post-production insertion (like Mirriad and Ryff). Also, brands that capitalize on this trend can see high-recall exposure in premium environments and may even get free “earned” exposure (like F1’s Damson Idris sporting the AXPGP racing suit, complete with sponsorships/product placements at the Met Gala).
At Somar, we don’t advertise. But we pay close attention to the platforms that allow others to do so more effectively. Companies enabling virtual product placement, rendering dynamic media, or turning back-catalogues into monetizable assets are increasingly in our research pipeline. The next generation of advertising is about context and user experience. We appreciate that more as consumers, and of course, as investors.
- Pedro Ramos