Dot-com dropouts

http://www.foxsports.com/business/bites/z010125superbowlads1.sml

Super Bowl ads feature corporate giants, rather than start ups

By Jeff Houck

FoxSportsBiz.com

Full Story: If last year’s endless stream of commercials from dot-com companies during the Super Bowl was more than you could bare, take solace. That won’t be the case this year.

Think of that trend as a dinosaur that probably won’t be seen again. A hulking dotcomosauarus that couldn’t adjust to the chilly business climate, if you will.

Of the 17 dot-com companies that paid up to $3 million for a 30-second spot in last year’s game, only three are returning: Monster.com, Hotjobs.com and E*TRADE.com. In fact, with three years of advertisement during the big game under their belts, Monster and Hotjobs could almost qualify as institutions.

Three of last year’s advertisers have since gone out of business and a fourth, Netpliance Inc., announced two weeks ago that it may be taken off the Nasdaq stock market.

Taking their place will be some of the biggest advertisers in corporate America, including IBM, Johnson & Johnson and Budweiser. Pepsi and MasterCard are also looking to grab the limelight amid the expected 80 million viewers. Cost: an average of $2.2 million per 30-second commercial.

The newcomers this year are still technology-based. Mobile phone company Cingular Wireless ó owned by SBC Communications and BellSouth ó is looking to make a strong debut.

And the biggest buzz about a spot surrounds the one by high-tech titan Electronic Data Systems. During last year’s game, their commercial depicting cowboys herding cats was the top rated ad. This year, their “Running With the Squirrels of Pamplona” is the front-runner to be the hot topic at work Tuesday. The message: EDS can help big companies hold off smaller, more nimble competitors.

But the bloom is certainly off the dot-com rose.

“It’s a pretty significant drop in one year,” said Peter Beckman, founder of AdCritic.com, which showcases ads online, including Super Bowl commercials.

“It’s just harder for tech companies to come up with the money, and it’s hard to defend the use of that money for a Super Bowl ad,” Beckman said.

Dot-coms or not, CBS still sold out of it’s commercial slots, although it still had some positions remaining as recently as two weeks ago. The network’s officials say CBS has surpassed the goal of $150 million worth of ads sold during the 10 hours of game-related programming.

How lucrative is the pinnacle of advertising?

Monster is paying about $4 million for four 30-second spots, two in-game and two pregame. Hotjobs.com is paying $2.4 million for a 30-second spot in the third quarter.

CBS’ NFL rights fee is $500 million this year, the third of their five-year contract. It’s a hefty jump from the $350 million they had been paying, but the Super Bowl ad income will cover the extra cost in swoop.

Some would argue that the advertising circus is almost equal to the game, with newspapers and Web sites grading each spot.

It was an ad Beckman saw during the 1995 game that inspired him to start AdCritic. He was watching a spot for Bissel vacuums in which a cat exploded all over a room full of carpeting. The tag line: “Slight shedding problem?”

“I laughed for three or four days,” he said.

He waited a few years until technology allowed him to show commercials in their full format on the Web. Launching after the 1999 Super Bowl, he started with 33 ads. Now he has hundreds and will post all of the ads from the 23 advertisers showcased during this year’s broadcast.

Traffic at the site jumps to between 5 million and 10 million visits in the days after the game, up from a usual daily average of 1 million. Beckman then makes his money by selling the information to companies about what people watched on the site and how they reacted.

“We’re going to post them all this year and let people rate the commercial itself,” Beckman said. Categories will include “best overall,” “funniest,” and “best use of brand.”

Oh, and “biggest waste of money.”

Dot-coms were all about blowing through cash last year, back when venture capital was as plentiful as wheat and stock prices were stratospheric. LifeMinders.com last year went as far as to show a plain yellow graphic that declared simply: “This is the worst commercial on the Super Bowl.”

No one’s laughing now.

The economic bubble for Web sites started to burst in April of last year and hasn’t shown signs of stopping. A handful of companies a day announce personnel cutbacks or fold outright. Gone is the hubris they showed in their cheeky ad campaigns last January.

“All these small start-ups used all their money (in 2000) to run one ad in the Super Bowl,” Hotjobs CEO Richard Johnson said. “I think we hit Alan Greenspan’s prediction of irrational exuberance, and last year really reflected that.”

Some ad execs say the dot-coms wasted their investment in last year’s Super Bowl when they failed to produce more commercials that would appeal to mass audiences.

“I thought the dot-com companies were talking to themselves,” said Paul Schulman, president of Schulman/Advanswers NY, a media buying firm.

Beckman said the strategies employed by the dot-coms “showed a lot of immaturity.” Instead of using the advertising to make more money by drawing people in ó like Hotjobs and Monster, which rely on traffic ó the companies were using their spots to just get their name out there for the sake of public recognition.

“The dot-coms didn’t get the respect they were hoping to get, mostly because it was these guys blowing millions on 30 seconds of ad time without a brand behind it,” Beckman said.

This year could be good for both Monster and Hotjobs, he said. But for the wrong reasons.

“Think about how many dot-com people will be looking for a job this year,” he said.