Cost of 30-Second Super Bowl Commercials Flat Since ’17, Declining Audience to Blame


The cost of a 30-second Super Bowl spot is up +700% (adjusted for inflation) since 1967 (when it cost just $310K) and +96% over the last decade (even as primetime ad rates declined -10%), but the league’s broadcast networks have been unable to command an increase in price the last 2 years as viewership declined; SB52 had the game’s smallest audience in 9 years. CBS sold Super Bowl 53 in-game commercials (+ some digital inventory) for $5.1 – $5.3 million, the same amount that Fox and NBC asked for spots in ’17 and ’18 respectively. But that doesn’t mean there’s a lack of interest in advertising during television’s most watched event of the year. CBS reportedly sold upwards of 90% of its commercial inventory before the season started and is likely holding any remaining commercial time for companies looking to buy in at the last minute – at a premium price.

Howie Long-Short: With 90% of the inventory sold months before the game, the teams playing have little impact on network profitability. Sure, viewership that exceeds expectations may help CBS sell ads next season and perhaps it will give a ratings boost to network shows (due to the added exposure), but as Neal Pilson (the former President of CBS Sports) told the Washington Post, “if you promise a 25 rating and deliver a 30, it’s the advertiser who gets the great value.”

Even if the game fails to over-deliver ratings wise, one can argue that at $5.2 million/spot advertisers are already getting a bargain. If the same number of fans that watched last year’s game (103 million) watch Sunday, advertisers will pay +/- $.05/viewer; national spots in prime-time typically cost anywhere between $.08-$.10/viewer.

A-B Inbev (BUD) will be the game’s most prolific advertiser with 8 spots (5.5 total minutes) promoting 7 products and 5 brands (Bud, Bud Light, Michelob Ultra, Stella and SpikedSeltzer); the company will also have billboards and bumpers during all 4 quarters, pre-game and post-game. 2 of A-B Inbev’s 8 spots will be used to promote Bud Light, but the company is also bringing back its city-wide beer promotion for fans of the winning team. Why? As Joao Chueiri (VP Consumer Connections, Anheuser Busch) explained to me, “5, 10, 15 years from now, we’re going to remember the experiences that we’ve lived, more than the advertising that we’ve viewed.” 

If that’s the case (and you won’t hear an argument here), then it’s worth asking why more brands aren’t tying experiential promotions to their SB campaigns? Michael Neuman, Founder, EVP and Managing Partner for Scout Sports and Entertainment, the in-house sports sponsorship and marketing division of Horizon Media (largest independent media agency in the world), agreed telling me that, “it’s a huge missed opportunity to pass on mobilizing a Super Bowl audience with a product experience. The Super Bowl is the time to experiment and take risks as the audience is highly engaged for the commercials. For Bud Light, it’s a brilliant marketing tactic. The winning fan base will be preordained to seek out the experience of drinking free Bud Light. The halo impact of such a creative tactic could resonate with fans enough to switch beer allegiances as winning a Super Bowl is as emotional as a sports experience you’ll find. Buffalo Wild Wings has also done a nice job with their promotion, offering a free snack sized order of wings (on 2.18 between 4-7p) if the Super Bowl goes into overtime; an equity attribute they’ve long included in their creative messaging.” 

CBS might be sold out of commercial inventory had they been permitted (by federal law) to sell national ads to marijuana companies. Acreage Holdings (OTC: ACRGF), a publicly traded cannabis company, was rebuffed in their quest to run a 60-second ad promoting the drug’s legalization. While CBS won’t approve national spots from advertisers in the marijuana (or gambling) space, Michael says it’s not unexpected for companies, from either industry, to run commercials for the first time in local markets during the game.”

I asked Michael, if marijuana and gaming companies were permitted to buy national advertising time, how would it impact the demand/cost of the spots?

Michael: Networks, leagues and teams are all awaiting the gold rush that comes with the consistent acceptance of those categories. Looking back on how the DFS category depleted premium inventories in 2015 with a combined $200 million media investment, it’s quite possible to expect tighter media inventories with greater investments required for non-upfront commitments.

Fan Marino: AB-Inbev might have exclusive category rights – which (in theory) prevents competing alcohol companies from advertising during the game – but, at least one has found a loophole; Yellowtail Wine bought local ads in 81 markets (will reach approx. 90% of total audience). Those spots will get Yellowtail in front of (most of) the audience they desire, but it’s going to cost them. Local spots go for +/- $100,000/per. If they’re buying in 81 markets, they’re spending $8.1 million; or 55% more than CBS is charging.

Fun Fact: Did you know that +/- 25% of Super Bowl viewers tune in solely for the commercials?

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Author: John Wall Street

At the intersection of sports & finance.

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