RationalPixels Pioneer Digital Product Placement in the MENA

Alexis Baghdadi, Apr 22 2016

Advertisers know that they have to rethink their traditional models for digital platforms, taking into account the way users consume media.

By now you’ve most probably heard of native advertising. It essentially consists of branded content that looks like regular editorial articles, in-feed items on social media, search ads, etc. Advertisers are adopting these strategies to integrate ads seamlessly into online and mobile platforms, attracting readers without disrupting their experience.

The Beirut-based RationalPixels have taken the issue from another angle. They are going after something that many are calling the future of advertising: digital product placement.

Product Placement Goes Digital

In just about any Hollywood blockbuster, there’s a good chance that certain brand products are ostensibly shown in some scenes. Sometimes, they are even an integral part of the plot. The most popular example is James Bond movies: since Goldeneye (1997), the British spy consistently wore Omega watches (up to the latest Specter movie).

This is traditionally how product placement worked. Brands paid to have their products used as props or their messages shown in movies. Of course, if no brand was willing to pay for product placement (or the producers were against the idea) then the movie was shot anyway, but that meant a missed opportunity.

Then came computer-generated imagery (CGI) and green screens. These technologies made it redundant to use real props (regular or branded) when those could be inserted digitally. Not only that, but they opened a door of opportunities: now product placement could be done at leisure, in post-production.

This makes digital product placement native by nature. It allows the embedding of unblockable and unskippable targeted advertising in videos on any website – with the publisher’s consent. This guarantees that advertised products reach more viewers, and makes it an attractive option for brands in the current digital context.

“Today, 94% of viewers automatically dismiss the advertising that shows up in video,” said Rida Sadek, co-founder of RationalPixels, “However, if the advertisement is subtle and embedded in the video content itself, the viewer will take note of it and will not dismiss the message by default.”

Building in Virgin Territory

Rida Sadek and Vadim Fedorov may not look like your typical entrepreneurs fresh out of college, but each of them is a force to be reckoned with. They both hold a PhD in Computer Science, and together they constitute an impressive lineup.

“As engineers, our scientific research pushed us to innovate in the creation of new products and to gain a deeper understanding of some fundamental elements,” said Sadek, the main creator of the technology and the project, “As far as starting up a new company, I believe this has to do with the sense of risk and adventure of a person rather than with their academic achievements.”

Sadek got the idea for RationalPixels around 2 years ago while at university. There, Fedorov joined his research group, in the last months before Sadek defended his thesis. Soon after, the two found they had a good connection and they knew that by combining their skills they could build a great product. By the time he finished his PhD, Sadek had already developed the basics of the technology.

“After consulting with our mentors we decided to venture into this project, while keeping our mentors as scientific advisors,” he said. He has been working on this project full-time, and has bootstrapped the venture mainly using his own savings and the help of family members.

I asked Sadek what pushed “computer geniuses” to the advertising field. “We are a generation that feeds on the internet, and the internet feeds on advertising. Without advertising, the internet would be dead since there will be no way to sustain its cost. So, we are not strangers to advertising,” he said.

Huge Opportunities for Scaling

Globally only one agency dealing with digital product placement is worth mentioning: the UK-based Mirriad.

RationalPixels aims to streamline and facilitate the process, delivering the same results in one sixth of the time. This solution is accessible to a wide range of advertisers, and does not require them to have experience in digital advertising technology. “What we are creating is an ad-space/inventory that is inside the video and that blends and moves dynamically with the scene,” said Sadek.

The founders have developed the main technology and are currently finalizing the write-up of a patent spanning the entire Patent Cooperation Treaty – PCT (148 countries). The end-product is now being piloted with the Beirut-based video on demand platform, Cinemoz.

In September 2015, RationalPixels joined the first batch of startups at Speed@BDD. The Beirut-based accelerator injected $30,000 into the startup – the only funding they three have received so far.  

They came out as one of the top 2 teams in this first batch, and were selected for the LebNet Ignite acceleration and mentorship program in Silicon Valley, powered by the Blackbox Connect accelerator.

“Blackbox was an eye-opener. It removed the fear of thinking big and gave a real feel of the possible and what can be achieved,” said Sadek.

RationalPixels are currently fundraising and are at advanced stages of negotiations with VCs.

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