Most dot-coms pass on Super Bowl
http://netscape.marketwatch.com/source/blq/netscape/archive/20010122/news/current/superbowl_ad.nsp
Only three Web firms advertising this year
By William Spain, CBS.MarketWatch.com
CHICAGO (CBS.MW) -With a few exceptions, the splashy Super Bowl ad – like the foosball table, the lavish executive retreat, the NASDAQ listing and the paycheck – is a thing of the past for the struggling dot-com sector this year.
Out of more than a dozen Web-based companies that bought the big game last year, just three — HotJobs.com HOTJ , Monster.com and E-Trade EGRP – have returned to the gridiron for a 2001 rematch.
Many of the players last year, including Netpliance.com NPLI, WebMD.com HLTH, Webex.com, and Autotrader.com are too busy worrying about layoffs and Happy Meal-sized share prices to spend a dime on anything beyond basic survival. Others, notably Pets.com, have already been put to sleep.
While a spot during the game remains an unparalleled one-off way to reach a mass audience, it is an expensive indulgence for companies with neither coherent business plans nor clear paths to profitability. Last year’s theory, which was that the high-profile ads and associated media hype surrounding them would drive traffic to the sites was borne out to some degree but few of the companies were capable of making it add to the bottom line in any meaningful way.
As veteran TV buyer Bob Flood of Optimedia, a media arm of French ad giant Publicis PUB, noted, the Super Bowl “fulfills the need for an immediate reach objective but it is an enormous investment to make for a week’s sampling.”
Even though ratings for the Super Bowl have leveled off in recent years, it remains among the few televised programs that can still consistently deliver a mass audience. Other network TV offerings, for instance the top ten primetime shows, have seen their viewer numbers halved in the last two decades. That pull is the main reason that ad rates for the game have climbed to the dizzying heights they are at today.
Analyst Andrea Rice of Deutsche Banc. Alex. Brown in San Francisco said that “for most [dot-coms], it is not a wise investment. It is a very expensive way for them to try and brand their companies. TV advertising is not for the faint of heart and not a sensible move for poorly-funded companies trying to establish a presence.”
Hotjobs and Monster, a division of TMP Worldwide TMPW, however, have effectively used the Super Bowl “to drive new resumes to their databases – a powerful draw for the companies that are their paying customers.”
They have also, she added, “been able to sustain a higher level of traffic beyond January and the Super Bowl.”
The two online job sites have also managed to achieve a level of critical mass where the Super Bowl is only a part, rather than the whole parcel, of a media plan.
Monster, for instance, will spend approximately $80 million on advertising this year, according to senior VP of marketing Peter Blacklow. This will be the third year running that the company has advertised during the game and it has purchased two 30-second ads in coveted timeslots for which it paid under $2 million apiece.
“In both [previous] years, we saw the amount of traffic on the site go through the roof,” he said. And while the traffic does gradually drop off from its immediate spike, “it does not go back to the previous levels.”
Still, “as important as it is, it is just one component of a multi-faceted program.”
For Hotjobs, which will commit “less than 5 percent” of its annual marketing budget to the Super Bowl, the game presents a unique opportunity to reach people at a time when they are most likely to be making career decisions, said VP-advertising Marc Karasu.
As an added bonus, “I challenge anyone to name a program where people are watching as much for the commercials as for the program itself. They are not just willing to watch the ads but practically looking forward to them.”
Karasu, who views the Super Bowl ad as part of a process of “carefully building a brand within the business plan’s projections” said this will be the company’s third time around in the game as well. While the current budget can easily absorb the buy, he noted that the first time “was a gamble – our CEO mortgaged his house to pay for that spot.”
E-Trade executives did not return phone calls seeking comment for this story.
This year’s Super Bowl, featuring a match-up between the New York Giants and the Baltimore Ravens, will be held on Sunday, January 28 in Tampa, Fla. The broadcast rights are owned by Viacom VIA subsidiary CBS, a significant shareholder in the publisher of this report.
William Spain is a reporter for CBS.MarketWatch.com in Chicago.