The placement of Chinese products in Hollywood movies is big business, but as Raymond Zhou finds, there may be a bumpy road ahead.
A dramatic prelude played out like pre-show entertainment before the new Transformers movie hit Chinese screens.
Barely a week before the Hollywood franchise opened in China, a Beijing property developer launched a tirade against Paramount, the Hollywood studio behind the Michael Bay movie.
Beijing Pangu Investment Co Ltd reportedly paid a 10 million yuan ($1.6 million) product placement fee to have images of its eye-catching building featured in the movie, among other benefits. Pangu is one of several Chinese companies with product placement deals with the new installment of the Transformers movie.
When the third Transformers movie rolled out in China in 2011, it grabbed headlines for a slew of embedded advertisements of Chinese products - an unprecedented four. All of them received wide coverage in the Chinese press.
Before the Pangu controversy came to light, I was interviewed by The New York Times and said that product placement seemed to be a new mode of cooperation between China and Hollywood. Chinese businesses have found a new way to capitalize on the popularity of Hollywood blockbusters and Hollywood does not have any qualms about absorbing the free flow of Chinese money.
When it comes to product placement in movies, Chinese director Feng Xiaogang is the pioneer and still the benchmark. His comedy If You Are the One attracted so many deals that it was rumored to have made its investment back without selling a single ticket. However, Feng was criticized for taking on products that did not fit with the scenes surrounding them. Later, it was revealed that Feng had resisted some of the deals, even smashing the set for one scene where he was supposed to display a certain brand more prominently than he deemed appropriate (yet was ordained by the contract).
However, Bay does not seem to face such a dilemma. The Shuhua Milk that popped up in Transformers 3 was so out of place it elicited a wave of laughs in Chinese theaters. Instead of hating the practice as they claimed, Chinese audiences seem to derive pleasure from spotting Chinese brands. We have yet to hear reports that Bay turns down deals because they do not fit into the storyline.
In the fourth installment there are even more Chinese brands, and Shuhua Milk is consumed very conspicuously in one scene. Considering that it is not even sold outside China, it could mean the advertiser was paying for global exposure that is essentially wasted. I'm curious as to what audience members in other countries think of this glut of product placement. In China, there were calls from some to show Feng's placement-rich films free of charge since "we have to endure so many ads". Now, talk about ads is not even followed up with purchase-ready products.
The dragon-headed Pangu building, frequently featured in the background of shots of the 2008 Beijing Olympics, does indeed appear in Transformers: Age of Extinction. The issue raised by Pangu in its statement concerns pledges to hold the movie premiere on its premise, which was instead held in Hong Kong, a city that was the location for some scenes as part of another deal, and an exhibition of some film-related props and equipment, among others.
There were rumors that, with the threat of legal action, Pangu was seeking publicity through unconventional means. In the run-up to the 2008 Beijing Olympics, it attracted massive media coverage when it announced Bill Gates had paid 100 million yuan to lease a whole floor of the building for the sporting event, which later proved totally baseless.
A netizen with the online handle Changchun Guomao, known for his inside information of China's showbiz, suggested on his micro blog that a Chinese competitor with a comedy set for release on the same date could be behind this. But none of these conspiracy theories could be independently verified.
A Chinese agent whose businesses include product placement deals with Hollywood told China Daily on condition of anonymity that it was a classic case of "over-promise and under-deliver" with the responsibility resting mainly with some third party that lubricated the Paramount-Pangu deal. He said he had sympathy for both Pangu and Paramount, who "were probably not aware of the gaps in the contract".
As if to confirm the analysis of our source, Pangu and Paramount announced reconciliation on June 23, but Pangu said it would continue to seek legal action against Jiaflix China and the Beijing Chengxin Shengshi Sports Culture Development Company Ltd. Now, even Paramount is said to be considering suing Chengxin Shengshi.
Sid Ganis and Marc Ganis, principals of Jiaflix Enterprises, which has been in cooperation with Transformers 4 for two years, denied it has anything to do with Jiaflix China, a company based in Beijing.
According to Pangu's statement, the English contract between Paramount, Pangu and Jiaflix is significantly different from the Chinese contract that was signed by the so-called Jiaflix China, Pangu and Chengxin Shengshi. Pangu has sued Jiaflix China and Chengxin Shengshi to cancel the Chinese contract.
On the surface, Pangu and Paramount have patched things up, with an exhibit of Optimus Prime moved to the Pangu premise and an opening celebration planned. "We have reached an agreement with Paramount after intense negotiations that dispelled misunderstanding caused by third parties," said Song Nan, a senior manager with Pangu.
The US side is all outwardly happy, as usual, with Bay gushing about "this great movie we shot in China" and how "fantastic" it is to work with Pangu. There is no doubt the new Transformers movie is going to make a lot of money, but I have begun to have second thoughts about the future of implanting Chinese brands in so-called Hollywood tentpoles. When the newsworthiness is gone, will the advertising return from the exposure be worth the cost?