With more than 100 million people expected to watch live, the Super Bowl presents an incredible opportunity for marketers. With that opportunity, however, comes a cost. This year, 30-second commercials in the game averaged $3.5 million, with some spots reaching as high as $4 million.
The multimillion-dollar question is are the ads worth it. From a stock market perspective, the answer is yes. According to a study by the University of Wisconsin-Eau Claire, Super Bowl advertisers from 1996 to 2010 outperformed the S&P 500 by more than 1% on average in the week before and after the game. The boost in share price is attributed to the hype associated with advertising in the Super Bowl. The longer a company hyped their ad during the year, the longer they outperformed the market. Public companies advertising in this year’s game include Best Buy, Coca-Cola and GM.
Nevertheless, given how critical fans are of the ads, corporations need to make sure they can afford to fall flat. $4 million for 30 seconds is more than some companies’ entire ad budgets. One of the most prominent examples of a Super Bowl ad gone bad was Just For Feet. The shoe retailer aired a racially insensitive ad during the 1999 game and filed for bankruptcy by the end of the same year.
The moral of the story? Advertiser beware…