How $3 million gets you 30 seconds
NBC says advertisers are still buying the $3 million spots for the big game, despite a tough economy.
By Aaron Smith, CNNMoney.com staff writer
NEW YORK (CNNMoney.com) — Despite record prices, a grinding recession and the absence of two big advertisers this year, NBC says it’s having no problem filling spots for Super Bowl XLIII.
The network has sold about 90% of its 67 spots for the championship game scheduled for Feb. 1 in Tampa, Fla., according to NBC spokesman Brian Walker.
Walker said advertising is “on pace or ahead of past Super Bowls,” adding that NBC is “in active negotiations with about a dozen potential advertisers.”
FedEx (FDX, Fortune 500) and General Motors (GM, Fortune 500) will not be buying spots this year. FedEx blamed the economy, while GM said the timing was just wrong.
NBC is charging, on average, $3 million for a 30-second spot. That’s more than the $2.7 million average price for Super Bowl XLII in 2008, when the New York Giants’ narrow victory over the New England Patriots was broadcast by Fox of News Corp (NWSA).
The average price of a 30-second spot crossed the $1 million mark in 1995 and passed $2 million in 2000, according to TN’S Media Intelligence. (See the table to the right). But industry experts say that it’s worth every penny.
“You have a better chance of reaching people with the Super Bowl than with any other media buy that’s available,” said John Verret, professor of advertising at Boston University.
Some 97.5 million people tuned into the game last year, according to the Nielsen Company. Only the World Cup can compete in terms of size and scope, but that’s for a different type of “football” that doesn’t generate much excitement among Americans.
“The Super Bowl is completely unique in its ability to reach everybody at the same time,” said Tim Calkins, marketing professor of the Kellogg Super Bowl Advertising Review. “There’s nothing else that’s even close.”
Many of last year’s advertisers will continue to run ads for the 2009 game, including soft drink makers Coca Cola (KO, Fortune 500) and PepsiCo (PEP, Fortune 500); auto industry companies like Audi, Hyundai and Bridgestone; online marketplaces like GoDaddy.com and E*Trade Financial (ETFC), the pet food company Pedigree, and the National Football League, which advertises for free.
Iconic Super Bowl advertiser Anheuser-Busch is running 4.5 minutes worth of spots, a half-minute more than last year.
“We’re obviously the game’s single biggest advertiser and have been for some time,” said Bob Lachky, chief creative officer for Anheuser-Busch. “It’s the one time when you can get, in one setting, the biggest concentration of adult beer drinkers at one time. This is a huge, huge selling platform for us.”
The Super Bowl may be synonymous with beer for many Americans, but the spots are coveted by advertisers of all stripes, because of the unusually ad-friendly culture.
“What makes the Super Bowl unique is that this is the one time every year where, instead of complaining about advertising, we celebrate advertising,” said Peter Blackshaw, chief marketing officer for Nielsen Buzz Metrics. “You can’t really beat the reach and you don’t have to worry about people flipping on the DVR fast forward button, because people like to watch the ads.”
Super Bowl and the recession
But not everyone believes that Super Bowl spots are worth the money, and the recession has taken its toll on at least a couple of long-time advertisers.
FedEx won top ratings from the Kellogg School of Management for its 2008 Super Bowl spot, which showed a gargantuan carrier pigeon wrecking havoc on city streets. But for 2009, the shipping company refrained from buying a spot for the first time in 12 years.
“As a country, we are in unprecedented economic waters,” Steve Pacheco, managing director of advertising at FedEx, wrote in a corporate blog. “A Super Bowl ad buy is not where we should put dollars at this time although, in the past, the value of doing so for FedEx has been indisputable.”
General Motors, the official Super Bowl sponsor, used an animated, 60-second spot during last year’s game to unveil its GMC Yukon Hybrid. But the automaker will not be airing a commercial this year. GM spokeswoman Kelly Cusinato said the company made that decision back in September.
“It just wasn’t a good enough return on the investment for that, because we didn’t have a major vehicle launch that aligned with the timing of the Super Bowl,” said Cusinato. “Then we went to Congress, and the economy got worse and we started scaling back a lot of other sponsorships.”
When auto executives went hat in hand to Congress last December, GM was strongly advised not to run a Super Bowl ad this year.
But not all automakers are shunning Super Bowl air time. Audi and Hyundai have both bought spots for the 2009 game.
Audi plans to run a 60-second commercial for the second year running, following its well-received “Godfather-“themed ad for the R8 luxury sports car. Hyundai plans to unveil its 2010 Genesis Coupe with two commercials, featuring a race course run choreographed to the playing of cellist Yo-Yo Ma.
Stuck with an expensive spot
Calkins of the Kellogg Super Bowl Advertising Review said that much of the air time was sold in September, and that some advertisers might regret their purchases, given the worsening state of the economy.
“Early in the fall, most of the spots were sold out,” he said. “That, of course, was before the economy really went south. The advertisers were stuck with them. There was a very strong initial demand, and there’s a very different climate right now.”
But for GoDaddy.com, a domain name marketplace that keeps censors on their toes with its risqué ads, there is no time like the present. The company has purchased a Super Bowl spot for its fifth consecutive year.
“Our theory on advertising is that when the economy is having some issues, that is not the time to cut your advertising budget,” said GoDaddy.com executive vice president Barb Rechterman.