On Sunday night, the New England Patriots beat the Atlanta Falcons 34-28 at Super Bowl 51 in Houston. The talk of the game centered around the quarterbacks of each team: league MVP Matt Ryan for the Falcons and (now) 5-time Super Bowl winning quarterback Tom Brady for the Patriots. What started as a big early lead for Atlanta, quickly evaporated as Tom Brady and the Patriots came back from the largest deficit in playoff history (25 points).
According to CNN.com, the overnight rating for Fox’s Super Bowl broadcast was a 48.8, meaning that over 48% of US households in the top 56 markets were tuned into the game and, with a rating like that, it is estimated that over 110 Million people watched the broadcast.
Although this game will go down as one of the best Super Bowls in history, much of the Monday morning “water cooler” talk will be focused on the commercials that were shown. This year, Fox said that the baseline price for a 30 second ad would be $5 Million, making it the highest advertisers have ever had to pay for their spot. This price is extremely astonishing compared to the first Super Bowl which was played in 1966 and had an average ad price of $37,500 – which would be about $284,000 today.
Each year, the Super Bowl is the most watched television program, so you can see why the pricing is so tremendous. This year, some of the most talked and tweeted about commercials included cameos from famous celebrities and athletes like Melissa McCarthy and Christopher Walken, a heartfelt tribute to members of the military driven by Hyundai and a strange “cleaning fantasy” of Mr. Clean through the eyes of a housewife.
These commercials all gained national attention, but will the benefit of running these ads outweigh the costs? Let’s take a closer look at some numbers…
For a 30 second ad, which costs $5 Million to place (not including production and sponsorship costs), this is how much each company would have to sell their respected products to (at least) cover their costs for that spot:
- Google must sell 76,924 of its Google Home devices ($129/each)
- Budweiser must sell 459,982 of its 12 pack bottles ($10.87)
- Yellow Tail must sell 627,353 of their Pinot Grigio bottles ($7.97)
- Mr. Clean must sell 1,672,241 of their Magic Erasers ($2.99)
- Bai must sell 276,855 of their 18 oz Pomegranate bottles ($18.06)
- Wendy’s must sell 2,762,431 Jr. Bacon Cheeseburgers ($1.81)
- Kia must sell 219 Niro cars ($22,890)
At first glance, these numbers can seem unachievable, but for national brands, such as Kia and Budweiser, these sales can happen in a single day. So, most would say that with the right strategy and execution of the ads, the investment will be well worth it for more national brands. I also took a look at local advertising and how these inflated prices affect businesses at the local level.
As we know, a national spot costs upwards of $5 Million, but local pricing is determined separately based on the size of the market. Democrat & Chronicle, a division of USA Today, says that a local market like Kansas City has a medium-sized market, so a 30 second local halftime ad is about $30,000. According to deadline.com, larger markets, such as New York and Los Angeles, are charging around $1 Million and $750,000, respectively.
But just having enough capital for the ad will not guarantee you a spot. Because halftime has less spots than the actual game (due to national halftime ad requirements and the long but spectacular halftime shows) local stations have the right to be selective about the ads that they air.
What started as the unfamiliar “Super Bowl” in 1966, has evolved to a national (as well as international) holiday. Families and friends gather at TV’s all around the world to indulge in nachos, BBQ chicken wings and domestic 6-packs. To some, it’s the biggest game of the year. To others, it’s an opportunity to be with loved ones and enjoy other things that the game brings you. The actual game is what brings us all to the same room, but the advertisements allow us to emotionally connect with each other. Since the first Super Bowl, spending has drastically increased, but overall, the return is not only great for increased company revenues, but also for all “the feels” that come with it.