Say it ain't so! Will recession affect Super Bowl ads?
In hard times, good news can make you stop and look. That’s how it was last week when the NFL announced a new corporate partner and NBC announced a purchase of commercial spots for its Super Bowl broadcast in February.
There they were, sticking out from under the confirmation that we’re in a recession: the statistics showing that the number of lost jobs this year could top 1.5 million and the rest of the avalanche of dreadful economic stories.
Are they signs of economic life? Maybe the first small steps toward a turnaround or recovery?
Or do they come with strings attached?
If you read carefully, the strings were easy to catch: The NFL’s new partner and the purchaser of the Super Bowl spots were one and the same: Monster.com, a job-search engine on the Web. Not that this is new ground. CareerBuilder.com, another job-search Web site that has bought time on the broadcasts of the past four Super Bowls, will advertise on the broadcast again this year.
Here’s an industry that actually thrives in hard times. You wonder whether a job-search company’s commercial on the Super Bowl broadcast should qualify as a public service announcement. What next? Spots for food banks?
It’s hard to write about sports and the economy these days. When life savings are evaporating and foreclosure notices are being pinned to front doors, the real story is bigger than any game, bigger than any league and bigger than sports itself. It’s not the playoffs that matter. It’s the layoffs.
We’ve grown accustomed to the spectacles of this recession. It didn’t start with traders hauling their belongings out of offices on Wall Street, and it won’t end with executives from the Big Three automakers going to Capitol Hill to ask for escalating billions to prop up an industry that finds itself with a flat and no jack.
In a way, it almost seems inappropriate to talk about the economic swoon in sports. It’s like focusing on a footnote and missing the big story.
Truth is, though, sports is in the weave.
Some of those disgraced, bankrupted and later bailed-out financial institutions are committed to millions for naming rights to stadiums and arenas such as the Wachovia Center in Philadelphia and the Mets’ new ballpark, Citi Field. Some of those companies that have laid off thousands of employees had billboards and partnerships with pro sports leagues. The Big Three automakers, likewise.
The effect is felt throughout sports. Maybe the sharpest financial run-up in recent memory has come on the PGA Tour, where prize money has tripled in the past 11 years. But PGA chief Tim Finchem has said that prize money will “certainly flatten” in the short run, according to Bloomberg.com. Although Finchem insisted that all Tour dates will go on as scheduled this coming season, it’s a gimme that there will be greater implications, given the state of the economy. Finchem even allowed that there might be a rollback in prize money a few years down the line as contracts with financial service companies, among others, expire. (Incidentally, Finchem is doing more than feeling our pain. He’s living it, too. He reportedly has taken a $400,000 pay cut.)
Hasn’t it seemed as if Buick’s entire marketing campaign has walked around in Tiger Woods’ spikes? For $7 million a year, Buick seemed to be getting a lot of mileage out of its investment, especially after Woods’ thrilling win at the U.S. Open in June and the prospect of his comeback from knee surgery provided what could well be one of the most dramatic stories of the coming sports year. But earlier this week, GM ended its nine-year relationship with Woods.
Maybe it shouldn’t have been such a surprise, given that GM and the other major U.S. automakers have had to go on bended knee in front of congressional committees. It was about optics. (Advertising is a means to sell, but the idea of investment in celebrity endorsers loses some cachet when you’re going hat in hand and on bended knee to Congress looking for billions.)
“It has always been a question of how many companies are going to be able to afford to do this kind of advertising,” says Bobby Calder, a professor of marketing at Northwestern’s Kellogg School of Management. “Now, they’ll have to view this even more strategically. The question becomes, ‘How will the public react to it?’ Whether it’s the content of the commercial — if it’s a winking, inside-joke type of commercial — or it’s the very fact that they’re advertising at all, the public is going to ask: ‘Where are they getting the money to do this?'”
That will be an ongoing consideration for the automakers, especially in light of widespread public disapproval for federal involvement in helping the companies through a very dark period. For now, at least, it apparently won’t affect one of their more obvious sponsorship partnerships. NASCAR suggests that business will move forward.
Chairman Bill France has said that NASCAR “wasn’t going to live or die if one manufacturer has a pullback or a pullout,” assuring reporters that, “I’ve been told by each of the [automakers] that the thing that works best for them is NASCAR. ”
The question is whether anything can work for them at all.
If asked which sports property should be safest in an economic storm, most experts likely would choose the Super Bowl. It would seem to be the bluest of all the blue-chip properties. It’s the most-watched event of any sort in any given year, leaving the Oscars in the distance. It has long been the head-on collision of sports and commerce.
On the Sunday of sport’s biggest game, the second-biggest game is played out among advertisers. For fans, the commercials at times have been the salvation of a one-sided Super Bowl. For Madison Avenue, Super Sunday can be a career maker or a career breaker.
For the players, the coaches and the owners, the game is over when the clock winds down to zero. For those in marketing, it’s really doesn’t end until the numbers, the Nielsen ratings and the reviews, notably USA Today’s Ad Meter, come in. Produce a campaign that flops on Sunday, that is singled out by critics as a failure, that is the subject of jokes on late-night shows and you’ll not only lose your job but you’ll also know a morning-after despair that’s familiar to kicker Scott Norwood and few others.
Kellogg’s Calder says the Super Bowl isn’t necessarily a measure of the health of the economy so much as “a measure for advertising budgets.” Calder says he expects the number of companies interested in Super Bowl advertising to go down and rates to flatten out this year and in the short run.
At this point, NBC is painting a rosy picture of the Super Bowl.
“We have fewer than 10 spots remaining out of 67 total for the Super Bowl,” NBC Sports spokesman Brian Walker said in an e-mail last week. “[NBC has] sold more than a dozen :30-commercials for $3-million, a record for any Super Bowl. NBC is ahead of sales pace from the last couple Olympics. We’re in active negotiation for the remaining spots.”
That’s not quite the word on Madison Avenue. According to one media buyer contacted this week, at least 12 to 14 spots remain open for NBC’s Super Bowl broadcast, and outfits that acquired spots in the “upfront buy” (purchases before the season started) are looking to unload them.
Not surprisingly, the car companies are out of the Super Bowl picture. GM announced this week that it would not be buying any spots on the broadcast. It maintains the decision was made well in advance of when the automakers went off the road, and even months ahead of the credit crunch in September.
“We’ve used the Super Bowl as an opportunity to talk about a new launch vehicle — the new CTS, the new Malibu,” says Steve Tihanyi, the general director of GM’s media operations. “Years back, we used it to relaunch the whole Oldsmobile brand. When we’re on the Super Bowl, we want to make a big statement. We don’t have any product story to tell, nothing in the pipeline that would warrant spending that type of money.”
Even if there were a product story, some experts think this year’s Super Bowl just isn’t the time to tell it. In fact, it might set off a backlash.
“This isn’t about stealing market share from a competitor,” says Eric Bradlow, professor of marketing at the Wharton School of the University of Pennsylvania. “It’s about the entire industry being down. The companies would have to ask, ‘Even if we have a successful ad, are we going to grow the pie? With the car market down, with disposable income and automobile purchases down, what are the odds?’ If you’re the only one who advertises, great. If all three advertise and there’s no benefit, you’re throwing good money after bad. It’s quite possible that they’ll all benefit from not escalating the comparative advertising.”
Just as interesting is the decision of Procter & Gamble to stay home this Super Bowl season, which might or might not be recession-related.
In Super Bowl XLII, P&G launched its “talking stain” campaign for Tide to Go.
Consumers on a YouTube poll selected it as the game’s top ad. It also drove an online contest in which members of the public uploaded their own home video talking-stain commercials, with the finalists’ versions going to air this winter. In the days after the Super Bowl, consumers spent more than 15,000 hours on mytalkingstain.com.
“It was an incredibly successful campaign,” says P&G spokeswoman Sarah Pasquinucci, who declined to say how or even when the company came to its decision. “We’re not necessarily someone who advertises in the Super Bowl. We do it when it’s a good fit for us. The economy has nothing to do with our decision.”
But at least one academic suggests that the company’s call is a telling one.
“P&G is considered by marketers as one of the most advanced measurement and research companies. They’re one of the companies that understand it’s a seamless world and how to track behavior cross-channel,” Wharton’s Bradlow says.
In other words, P&G was able to see return on investment for its investment in the campaign by measuring the reach of the commercial using online metrics. Yet the acclaim and the well-tracked numbers weren’t enough to persuade P&G to attempt a second act.
In scale, CareerBuilder.com and Monster.com seem to be in a lower weight class than the likes of the Big Three or P&G. Yet, they’ve taken aggressive positions this fall.
“Year after year, it makes business sense and branding sense for us, being able to reach 90 million to 100 million in the U.S.,” says Cynthia McIntyre, CareerBuilder.com’s senior director of advertising. “It has great timing for us.
Employers are looking at a fresh, new calendar year and new budgets. We see a clear ROI from the Super Bowl — a job-seeker traffic surge, a surge in applications.”
For Monster.com, it isn’t just seasonality or even a growing number of Americans hunting for jobs.
“We spent the last year redefining our company with new tech, launching it in January,” says Ted Gilvar, Monster.com’s executive vice president of global marketing.
“We need to tell the world about it, and there’s no better way than the Super Bowl because of the reach it has. And we became a partner of the league because we didn’t want to just go on the Super Bowl and have one fleeting moment and not carry forward the impact and extend the value of what we do.”
The one constant at the Super Bowl has been Anheuser-Busch, and this year is no different. For its 21st year as the exclusive alcohol property on the Super Bowl broadcast, A-B has bought five minutes in advertising time, and company executives say they’re giving no consideration to selling off any of it. A-B says it is committed to this position through 2012.
“There’s fragmentation of media out there, but you can still bank on the Super Bowl,” says Keith Levy, A-B’s vice president of marketing. “Over 80 percent of the audience are over the age of 21, and 46 percent of all beer drinkers will watch the game. It’s not a question of if we’re going to advertise, but how. Familiar formula, entertainment. Bud Light is humor; Budweiser is heritage, the Clydesdales.”
It’s easy for A-B to justify, but it’s a much harder call for others to make.
One media buyer who requested anonymity and who has worked for companies that have bought positions on Super Bowl broadcasts in the past says corporate America should not be scared off.
“If the price is right, I’d recommend my client wait until two weeks or a week before to get the best possible price,” he says. “At that point, the network has to move inventory.”
Wharton’s Bradlow suggests that hard times are exactly when companies should be taking aggressive positions.
“I believe a down market is exactly the time not to cut your advertising spend,” Bradlow says. “When other people are cutting their spend, it’s an opportunity to increase your spend — to gain market share, to gain awareness, to gain differential advantage. If the ship is going down, you might as well pull out the stops.”
For some, perhaps. The online job-search engines, for sure. But the automakers are a special case. If one of them dares to enter the Super Bowl at the last minute, it might seem like sending a request to the band after the Titanic hit the iceberg.
And anyway, with executives of Detroit’s Big Three sitting in front of cameras in congressional committees, how much more face time can they stand?
Gare Joyce is a regular contributor to ESPN The Magazine and ESPN.com.