Are Super Bowl Commercials Worth It? Part 1

Are Super Bowl Commercials Worth It? Part 1

Super Bowl Sunday is upon us once again. For many, including myself, that means watching a team become champions, drinking a few beers, and wolfing down chicken wings at an alarming rate. For others, it’s a social event. An excuse to get out of the house or host a party on a Sunday and having something to talk about at the water cooler the next day. Regardless of which category you fall into, you are part of the holy grail for advertisers.

Think of the last Super Bowl party you attended. When was it the quietest? During game play? Nope, everyone is talking or yelling at the TV as if they’re going propel Peyton Manning’s “ducks” over Richard Sherman’s outstretched arms. As I mentioned, some people don’t pay attention to the game, but everyone pays attention to the commercials. The commercials are easily the quietest point of the night. Everyone wants to hear the punchline or figure out what the bizarre commercial they just watched was actually advertising. For the most part, advertisers can only dream of having peoples’ attention like this. They get this opportunity once a year, and they aren’t going to miss out on it.

With the Super Bowl being the most viewed television broadcast in the U.S. every year, companies aren’t afraid to cough up the huge costs for their time to shine. For the second year in a row, the cost for a 30-second spot is $4 million. While that may seem like an exorbitant amount of money (it is), it is right around the norm in terms of CPM (cost per thousand viewers) that advertisers are used to spending. Popular TV shows command roughly a $35 CPM. I’m sure many people heard the price tags of $3 million, then $3.5 million, and now $4 million for a 30-second spot and thought companies were crazy for paying these prices. But 2012 viewership numbers resulted in a $31 CPM, a bargain for advertisers. 2013 numbers dipped and the price hike to $4 million resulted in a $37 CPM. This was clearly the reason for no price hike this year. Advertisers are hoping Sunday is another record breaking year in terms of viewership which will alleviate some of the price hike in CPM they saw last year. We will have to wait until after Sunday to find out if they overpaid or underpaid.

While the CPM for Super Bowl commercials should be within a few dollars of the traditional $35 CPM, because of the magnitude of the audience smaller companies cannot afford to buy airtime during such an event. One company in particular has realized this and is running a “S**** B***” campaign a few days early. Pretty good stuff from Newcastle Brown Ale below.

And obligatory Anna Kendrick spot for it, because, well, I love her.


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