Super Bowl ads: Why Bay Area tech firms still fork over the cash – San Francisco Chronicle

A still from Intuit’s first Super Bowl ad, which focuses on a small business, New York-based Death Wish Coffee, which has only 11 employees.

A still from Intuit’s first Super Bowl ad, which focuses on a…

For a tech company like PayPal, airing an ad during a 50-year-old American football game may seem counterintuitive — especially considering the firm’s seemingly endless digital options.

But marketing experts say if companies want to reach a mass audience of more than 100 million across many demographics at once, the Super Bowl is still the place to be.

“We couldn’t think of a better opportunity,” said Greg Fisher, vice president of global brand marketing at PayPal. The company’s 45-second ad will roll during the first quarter of the big game on Feb. 7 and will deal with how people move and manage their money. “It is the biggest stage in the world to get this message across,” said Fisher, who declined to say how much the commercial cost.

Super Bowl ads never come cheap — 30-second spots were selling for $5 million, according to CBS’ CEO Leslie Moonves in a call with investors in August. At that time, Moonves said Super Bowl ads were “already proving to be more lucrative than ever,” according to a transcript on financial analysis site Seeking Alpha.

Indeed, the price tag on Super Bowl ads has been increasing and is the most expensive spend for ad time on TV, according to media intelligence firm Kantar Media. The average rate for a 30-second ad was $4.4 million last year, up 76 percent in the last decade, Kantar said.

This is the first year tech firms PayPal and Amazon are advertising during the game. Amazon is marketing a wireless speaker, Echo, that responds to voice commands. The push for a broader audience makes sense for both firms, which face intense competition over their products. PayPal, a pioneer in mobile and online payments, has recently had a slew of rivals pop up in the form of Apple Pay, Samsung Pay and Facebook Messenger.

It’s a good time for PayPal to take a bold step like this, said Paul Verna, a senior analyst at research firm eMarketer.

“Two or three years ago, it might not have made a lot of sense for them to advertise in the Super Bowl,” Verna said, noting that now “they are under threat by these potentially disruptive competitors. It definitely makes sense for them to get in front of it.”

Another Bay Area firm, fast-growing San Francisco online lender SoFi, is also placing a bold bet on the Super Bowl.

SoFi, which raised $1 billion last fall and has now made $7 billion in loans, is making the company’s first Super Bowl ad the centerpiece of a new marketing push.

SoFi’s first Super Bowl commercial is aimed at 25-40 year olds.

“If we’re going to go for it — and we’re a company that’s going for it, we didn’t just get here yesterday — it was the right time to step up,” said SoFi CEO Joanne Bradford, who was briefly president of The Chronicle and has worked for other tech properties.

Bradford acknowledged that placing 20 percent of SoFi’s marketing budget on this campaign is a “relative risk,” but her hope is that the resulting increase in brand recognition produces a “15 percent lift to our business over the course of the year.”

SoFi’s 30-second spot, helmed by the film director responsible for the 2008 James Bond film “Quantum of Solace” and “Kite Runner,” will air sometime in the middle of the second quarter. It’s aimed at 25-to-40-year-olds who are ambitious and have a strong likelihood of paying off their loans.

PayPal wouldn’t reveal the details of its commercial, but Fisher hinted it will represent “a crowning moment for us, reintroducing our brand to people.” He hoped the ad would raise more awareness of PayPal’s brand, adding that the company will monitor social media and brand perceptions leading up to and after the Super Bowl. It will also be the first major ad push since PayPal separated from its former parent company, EBay Inc.

Mountain View-based Intuit, which provides financial software like QuickBooks and TurboTax, also hopes to raise its profile during the big game. Intuit will air two commercials, one 30-second commercial featuring TurboTax and another ad that will prominently feature a small business as part of its Small Business Big Game contest. Small businesses explained why they should get a Super Bowl ad, and online votes determined the winner. Most of this year’s 30-second small business ad shows the winner, Death Wish Coffee Co., with just seconds at the end that says “Intuit QuickBooks is proud to put a small business into today’s game.”

“It really cements QuickBooks as the champion of small business success,” said Ken Wach, a senior vice president of marketing at Intuit. “They do stand for small businesses and they are putting their money where their mouth is.”

New York-based Death Wish has only 11 employees. The commercial shows men on a boat facing stormy conditions. The boat eventually falls over an abyss, which turns out to be a man’s mouth guzzling coffee.

The last time Intuit picked a winner for its Small Business Big Game contest was 2014. Wach said the hype surrounding the ad helped fuel 14 billion impressions over the contest’s six months of activities. The 2014 winner, GoldieBlox, landed a distribution deal for its toys at a national retailer after the spot aired, Wach said.

But figuring out who’s watching ads during the Super Bowl game can be tricky. Unlike social media ads, companies can’t pinpoint who will tune into a TV screen at, say, a Super Bowl party. But that could also be an advantage, said Robert Thompson, director of the Bleier Center for Television and Popular Culture at Syracuse University.

For example, not all Super Bowl watchers would be interested in seeing an ad for a luxury brand, but “in that audience there is going to be enough (people) to make it worth your while,” Thompson said. “That wouldn’t necessarily happen on a show that reaches 20 million people.”

Maintaining the excitement around the Super Bowl after the game can also be challenging. Intuit QuickBooks saw a boost in brand sentiment after its first small business commercial aired, but it went back to normal levels two or three months later, Wach said. This year, Intuit has a platform, the Own It Network, that allows small businesses to connect with each other, and hopefully conversations will continue post Super Bowl there, Wach said.

With the Super Bowl taking place in Santa Clara, local companies say they believe their commercials will also hit closer to home. PayPal’s Fisher said he recently showed the company’s commercial to people on its sales team inside a hotel conference room and cheers erupted. People wanted to see the ad again, he said. He plans to show it to more employees next week.

“At the end of the day, you look at the Super Bowl, it’s right in our backyard. It’s going to be a rallying cry for employees,” Fisher said.

Wendy Lee and Joe Garofoli are San Francisco Chronicle staff writers. E-mail: wlee@sfchronicle.com, jgarofoli@sfchronicle.com Twitter: @thewendylee, @joegarofoli

Source: Google News Super Bowl Commercials