It's an ad, ad, ad world
By Thomas Lee
The cost of advertising during the Super Bowl has soared as viewership has declined, yet companies, including Anheuser-Busch, pony up millions for commercials to introduce new products, build a brand and hopefully boost sales.
The Super Bowl may be the ultimate TV event of the year, but for companies willing to pay millions of dollars for a 30-second commercial, success is not a sure thing.
For every Anheuser-Busch Cos., whose humorous commercials consistently are audience favorites, there’s also an AT&T Wireless Services Inc., whose mLife ads in 2002 seemed to annoy viewers more than entertain them.
And even the funniest commercials don’t mean anything unless they help a company sell something, whether a product, service or an image. When it comes to getting a return on their Super Bowl investment, most companies miss the point, experts say.
“When you really look at the facts and figures, (consumers’) recall rate is really low,” said Kelly O’Keefe, chief executive of Emergence, a brand and marketing consulting firm in Richmond, Va.
“Even if they remember the commercial, they don’t remember who did it. The Super Bowl is just not a great way to spend a couple of millions of dollars to breed a brand.”
Over the past 20 years, the average cost of a 30-second spot, when adjusted for inflation, has soared 170 percent to $2.25 million, according to Advertising Age, a leading trade publication.
“I often wonder how high is too high, because the prices are growing but the audience isn’t,” said Bradley Johnson, editor at large for Advertising Age.
In 1993, a 30-second spot cost about $1.1 million in today’s dollars, and the Super Bowl attracted about 91 million viewers. Last year, 30 seconds cost about $2.1 million, but the game garnered only 88.6 million viewers.
But even with a declining audience, the Super Bowl is still the most-watched television event of the year, drawing about 120 million viewers worldwide.
“It’s a very tempting audience,” O’Keefe said. “The allure is there.”
Experts and company executives say if done properly, advertisers can get their money’s worth.
Take Anheuser-Busch. Thanks to an enormous marketing budget, the St. Louis-based brewer typically buys the most air time during the Super Bowl. For CBS’ telecast of Super Bowl XXXVIII on Sunday, A-B bought five minutes of commercial time, far more than any other company. It also helps that A-B is the exclusive beer advertiser for the Super Bowl, besting rivals Miller Brewing Co. and Adolph Coors Co.
What makes A-B’s investment pay off is not what it does during the Super Bowl but rather afterward. The company uses the excitement surrounding the Super Bowl to “invigorate our selling season,” said Bob Lachky, vice president of brand management. “It’s the best way to motivate wholesalers to sell our products by showing off our powerful marketing resources.”
Analysts say Anheuser-Busch gets the most out of its money because it follows up by rerunning its best Super Bowl commercials for three to six months. It also anchors many annual marketing programs around those ads.
“The Super Bowl is actually a very efficient media buy,” Lachky said. “People may find that hard to believe. But we amortize the costs of the spots by building growth and sustaining market share throughout the year. The spots do have a halo. If they resonate, if they are likable, it does carry on.”
Johnson noted that Super Bowl ads make up about 2 percent of the brewer’s overall marketing budget. “It’s a drop in the bucket – but a loud drop in the bucket.”
By contrast, most companies mistakenly think of the Super Bowl as a one-time event, said Mark DiMassimo, chief executive and creative director of DiMassimo Brand Advertising in New York.
During the Internet boom of the late 1990s, several dot-com firms threw money at Super Bowl ads without any marketing strategy, he said. Quite often, Super Bowl advertising is more about egos and prestige than good business sense, DiMassimo said.
Experts say the Super Bowl can be an ideal time to launch a new product or brand initiative. One of the most famous Super Bowl ads was Apple Computer Inc.’s “1984” commercial, which introduced the Macintosh.
This year, Staples Inc. will debut its first-ever Super Bowl commercial. The 30-second spot plugs its new tagline: “Staples. That was easy.”
In previous ad campaigns, the company emphasized price and selection, said Shira Goodman, executive vice president of marketing. But faced with strong competition from rivals Office Depot Inc. and Wal-Mart Stores Inc., Staples wanted to differentiate itself by focusing on how the company makes shopping for office supplies easy, she said.
With the Super Bowl, “There’s no better place to put a stake in the ground,” Goodman said. “It’s a unique opportunity to communicate your most important message to your hard-to-reach consumers.”
She noted that Staples “would only do (the Super Bowl) if we had a strong message. It has to be strategically important to us. Just to be there because everyone else is, is not a compelling reason.”
America Online is using this Super Bowl to plug its new TopSpeed technology that increases broadband and dial-up speed. Besides buying 90 seconds worth of spots, the company also is hosting several interactive events, such as a poll that invites users to view and vote for their favorite Super Bowl commercial of all time. The company also will offer free downloads of music performed during the halftime show.
“The Super Bowl is the most cost-effective way of reaching a critical mass audience,” said Len Short, AOL’s executive vice president for brand marketing.
Super Bowl advertising is not just about images and branding; it can also boost sales. A-B’s Bud Bowl promotion is a classic example. During the 1980s, people watching the Bud Bowl commercial could fill out scorecards and then go to stores, which had set up lavish Bud Bowl displays, to enter a sweepstakes. The result: a significant spike in sales volume, Lachky said.
For this year’s Super Bowl, the brewery formed partnerships with several food and snack vendors, such as Red Baron Pizza and KC Masterpiece Barbecue, to promote each other’s products. The championship game is the top home-party event of the year and the second-biggest day for food consumption, Lachky said.
Such promotions “bring more value” to the brand, O’Keefe said.
PepsiCo Inc. is running a Super Bowl ad touting a joint promotion with Apple. For the next two months, Pepsi drinkers with winning bottle caps can get a total of 100 million free music downloads from Apple iTunes, its new online music service.
Super Bowl advertising still depends on good creative work that is smart and entertaining, said Johnson of Advertising Age.
Charles Schwab Corp. and Levi Strauss & Co. failed to connect with audiences last year because their commercials were either not amusing or too abstract, critics say. Celebrity appearances by Celine Dion and Michael Jordan in spots, respectively, for DaimlerChrysler AG and Hanes, owned by Sara Lee Corp., also fell flat.
Companies also risk irreparable damage to their brands with bad ads, O’Keefe said.
Over the years, Super Bowl commercials have become an entertainment spectacle with audiences and publications offering critiques of individual ads.
But creativity alone will not strengthen brands or generate sales without a bigger-picture approach to marketing, experts say.
“If you are putting all of your eggs in a 30-second basket,” O’Keefe said, “it’s just not going to work.”
Reporter Thomas Lee E-mail: [email protected] Phone: 314-340-8209