“I am only watching the Super Bowl for the ads.” Chances are you either are this person or know this person. Over the years, America's most prominent live sporting event has become an integral part of society. The last Super Bowl (Super Bowl LVI) amassed 208 million viewers or two-thirds of the American population. As a result, airtime for Super Bowl Sunday has become highly coveted, incentivizing advertisers to shell out an average of $7 million for a 30-second spot.
We sat down with Associate Professor of Marketing Bruce Clark to understand the advertising world in one of its finest forms.
Describe how the landscape of advertising has changed throughout the digital age. Is TV in its “Fourth Quarter?”
There is a long trope in marketing that television advertising is dead. This isn't true, but TV is less powerful than it used to be. Nowadays, television advertising is at its best around live events, specifically sporting events. NPR reports that 24 of the top 25 most-watched television programs in the last five years were NFL games, and the NFL reports that Super Bowl LVI was the most-watched television program in the last five years. That is why the Super Bowl continues to be a powerful mechanism for advertisers.
If advertisers could just post on social media for free, why are they still paying a premium for a Super Bowl spot?
If you want to reach a gigantic market of Americans all at once, there is nothing like a Super Bowl ad. And a Super Bowl ad is received differently by consumers than ads that appear on regularly scheduled programming for the following reasons:
- There are ads; then there are Super Bowl ads. Viewers are primed to think that a Super Bowl ad is of a certain quality; thus, they will pay more attention to it.
- The average Super Bowl ad costs $7 million. A company's ability to pay for that spot communicates to its customers and competition that they are a force to be reckoned with.
- A company gains legitimacy when its ad is shown next to iconic companies like Coca-Cola and P&G. This is particularly true for newer companies.
- Companies who execute well on their game day ads can gain respect in the professional world. Think of it like an awards show but for advertisers.
Most companies are releasing ads on YouTube ahead of time. Why is this the case?
Companies want to maximize their return on investment. Posting on social media increases the longevity and reach of an ad. There is a pre-viewing, live-viewing- and post-viewing life cycle of an ad. Think of it like a hill. The ascent up the hill represents a week or so before the Super Bowl. This is when the ad is released on social media. A pre-release helps build mental associations in the consumer's mind about the brand. The crest of the hill is when it airs during the event. When consumers recognize an ad on game day, they are more likely to pay attention to it. The descent is the week after the Super Bowl. This is when consumers re-engage with the ad on social media. Through organic (non-paid) impressions (likes, retweets), social media allows companies to benefit from free promotion throughout the lifecycle of their ad.
How do advertisers measure the success of their Super Bowl ads?
While advertisers do still try to estimate how many people viewed the ad, in the digital age, search volume and website visits are key metrics of success. There are now means to track these results to the minute, so companies can measure fluctuations in real time. Companies can also track sales patterns in the same way. Going to a website, searching, and sales indicate active engagement from the consumer and are desirable outcomes. While social media impressions are also relevant, they are a less useful indicator of success. Impressions, likes, and shares require little effort and are not as strong a metric.
There seems to be a mutually beneficial relationship between advertisers and the NFL. Can you explain to us how it works?
Actually, it's a three-way street. There are the advertisers, the networks, and the NFL. The NFL sells licensing and broadcasting rights to networks like ESPN. The networks then sell the airtime to advertisers to help recover the cost of the media rights. The networks also earn fees from cable subscribers, thus giving them two revenue streams. To understand the scope of these deals, consider that the current media rights packages awarded to the NFL amount to $113 billion throughout an 11-year time span.
Conclusion
While the world of advertising is changing throughout the digital age, a spot during the Super Bowl remains valuable for advertisers. If you have the need for mass reach and the ability to pay, it's worth every penny.
