Coronation Street is getting a Sainsbury’s – why product placement could trump traditional TV ads

The latest plot twist in the world of TV soap operas is one of the most unexpected yet: the Weatherfield Co-op, a feature of the gritty northern series Coronation Street since 2018, is to be replaced by the more upmarket grocery retailer Sainsbury’s.

From July, the sponsorship and product placement deal will feature Sainsbury’s and Argos (the two merged in 2016) in scenes on Victoria Street, which adjoins Coronation Street. Viewers will see branding in the background as characters chat on the street or pop in for groceries. The brand visibility will also extend to shopping bags and other props.

The product placement agreement with ITV, set to run until 2026, won’t have been cheap. In 2021 Argos was reported to be paying £10 million a year to sponsor the show. Other brands have paid to appear on the Corrie cobbles in the past, including Costa Coffee, EE and travel firm Hays Travel.

This product placement deal is evidently part of Sainsbury’s latest business strategy. The chain has been expanding in the north of England for more than decade, and now it is on a big push to grow the number of its smaller convenience stores. In 2022 CEO Simon Roberts announced that he wanted Sainsbury’s to be as cheap as Aldi. Providing value on everyday items is now seen as key to its sales growth.

A recent TV ad that challenged the perception of the retailer as one of the pricier brands reflects this updated strategy. And having viewers see working-class Coronation Street characters regularly using their local Sainsbury’s reinforces the message that the chain is not just for shoppers with lots of disposable cash.

A changing market

We have been researching TV product placement for almost 20 years. At the start of that time, the UK regulator Ofcom did not allow domestically made shows to receive money from brands in exchange for featuring in scenes. The practice had been common for years in movies and overseas shows, including some that were bought by UK channels, like Friends and Sex and the City. UK channels weren’t allowed any of that revenue.

Ofcom launched the first public consultation on allowing paid-for product placement on UK TV in 2005. Our research was widely used to show that UK viewers had no objection. However, it took until 2011 for the rules to be changed.

But the expected boom in deals never appeared. This was partly because of the mind-bendingly complex rules imposed by regulator Ofcom.

It was also down to the historical dominance of the free prop supply system on UK TV. Under free prop supply, TV productions can get the items they need for scenes free of charge. The brands pay a retainer to a prop supply company but the TV company receives no revenue. The brands have no control over how, when or if they will feature.

Paying for a single product placement deal on a specific show previously seemed like a lot of trouble when a traditional TV advertising spot would give brands all the control they wanted, along with the audience reach.

But changes in the TV advertising market have made product placement more attractive to brands.

TV audience figures are falling off a cliff as viewers, especially younger ones, abandon the traditional family ritual of watching scheduled TV in favour of streaming shows, watching when it suits them on smartphones and laptops.

Soaps are being hit especially hard, and the figures are stark. On Christmas Day 1987, Coronation Street attracted 27 million viewers but this had shrunk to 2.6 million by Christmas 2023. Arch-rival EastEnders did a little better, but the BBC’s flagship soap was still 90% down on the heady days of 1986, when 30 million viewers tuned in for the Christmas special.

He didn’t even giftwrap it… around 30 million viewers tuned in to EastEnders on Christmas Day 1986.

As viewing figures shrivel, traditional TV ad revenue is falling at its fastest rate in 15 years. When viewers stream shows on services like ITVX or Channel 4 on demand, the advertising is personalised and often skippable. Traditional TV advertising spots are expensive to buy and to produce, and with the top soaps getting just two to three million viewers in real time, the value to brands is not what it once was.

The soaps still represent the best opportunity to reach large audiences in a typical TV week however, with up to seven million tuning in to Corrie’s weekly output overall. But much of this audience will skip the advertising spots because they’ll be streaming the show outside the scheduled broadcast time.

This is where product placement fits with digital TV viewing patterns. A brand in a scene is always there and can’t be skipped. It is also great for normalising consumer behaviour like contactless payments or buying lottery tickets, provided the brand is woven into the scene so its presence is taken for granted.

Even though the Sainsbury’s branding will only be visible for seconds at a time, seeing Corrie characters regularly pop into their neighbourhood store is a powerful message that the brand is for everyone.

A passive presence in the viewing pleasure of millions of Coronation Street fans is ideal for the new Sainsbury’s strategy, and it might just signal a new dawn for TV product placement.