Super Bowl Ads Aren’t Worth the Cost: Why Hollywood, Beckham and H&M Will Be Sunday’s Biggest Losers

Posted on Feb 1, 2012 in Advertising | 4 comments

By Kirk Wakefield, Edwin W. Streetman Professor of Retail Marketing, Hankamer School of Business, Baylor University

In some ways, it’s hard to imagine exposure during the Super Bowl is worth the cost. The average CPM (cost per 1000 households) during primetime TV was just over $22 this past year. The CPM for the Super Bowl is over three times that at about $76. If the brand wants to gain exposure to its target audience, there are far cheaper and better targeted alternatives. So, exposure and its associated objective of gaining awareness can’t be the reason for advertising in the Super Bowl.

Brands and agencies representing mass marketed and frequently consumed products by the majority of Americans might argue their target audiences widely overlap with the 160 million who tune in for at least part of the game. That argument fails first on the facts of CPM. The argument fails again based on the effective CPM for the brand.

What percentage of the audience are viable targets?

Let’s take car manufacturers. Americans on average now keep their cars for over ten years. Let’s suppose maybe even two in ten is in the market for a new car. That means that 80% of the audience might even like the ad, but the information is immaterial to them. What we know from research is they won’t much like the ad because they won’t even pay attention. Audiences tune out if product involvement is low. Look at last year’s least popular ads and you’ll find automotive leading the way. Consequently, the advertising waste spent communicating to an audience not in the market makes the effective CPM multiples of the already bloated $76 CPM. Take that one step further and ask how many of those in the buying market (the 10-20%) are in the market for a BMW, Mercedes, or Audi? All of these recent Super Bowl advertisers are spending $3.5 million for 30 seconds to talk to a fraction of the audience.

The second major issue is a matter of relatedness and context. Does the brand and the advertising fit with the sports/entertainment context of the Super Bowl?

Budweiser, Pepsi and Coke may seem to make sense, as they are a part of the fan experience in many sports venues. The question is, “Do they really gain anything else by being in the Super Bowl, given that they already hit this audience hard and heavy the rest of the year?” My studied guess is that brand loyalty among sports fans for these sports advertisers is no better off because of the Super Bowl, since they have already saturated this market.

Here’s what we know about how advertising succeeds in national and international sporting events:

  1. The brand advertising must somehow relate to the event. We more easily process information that is congruent or similar. So, ads that are entertaining and tie into the sport/event make sense. Ads that are informational and unrelated to the context (sports/entertainment) tend to be ignored—and in any case do not occupy the same mental space as the sport/event. Last year’s information-based Verizon iPhone 4 announcement and HomeAway ad (both ranked in the bottom 20% in USA Today’s Super Bowl Ad Meter) exemplify this failure. What? You don’t remember those? Me neither.
  2. The brand must be prominent and familiar. Prominent, well-known brands are already stored in memory and easy to retrieve. Unknown brands must be learned and associated within the current mental framework accessible (viz., the Super Bowl) to be recalled. So, unknown brands are easily forgotten and rarely connect with viewers. Local ads shown on cable rotation easily fit this description. Among official Super Bowl advertisers, creative ads where the product is only tangential to the content will suffer (see last year’s Lipton Brisk ad with the Eminem claymation). In an entertainment environment, we simply won’t work that hard to make the mental connection.
  3. The brand must add value to the event. Viewers must believe the event is better off because of the brand. They would miss the brand if it wasn’t there. When fans connect the brand and the event like that, the two share the same mental space. That’s when the fan’s passion for the event transfers to the brand. The Doritos campaign involving fan creations of ads for the Super Bowl achieves this goal.
What brands will fail in the Super Bowl?

The reason to be in the Super Bowl (compared to other media options) is for fan passion to transfer to the brand. This can happen if the brand is related, prominent, and adds value to the event. With that in mind, let’s use H&M’s David Beckham ad as a likely failure.

David Beckham has nothing to do with American football. His Q-score in America is in the neighborhood of 20, which maybe better than Eli Manning (19) or Tom Brady (15), but not anywhere close to Peyton Manning (40) in recent years. H-M, a UK-based department store, is not prominent or familiar to the audience. Obviously, they are trying to introduce themselves in a big way through the Super Bowl. But, one look at the ad itself (http://www.youtube.com/watch?v=eQb_-OY7Z0E) will tell you that the audience will not work that hard to encode the message H-M is trying to communicate. Take a look for yourself:

Since the ad content is irrelevant to the Super Bowl, few in the audience will associate the brand with the event. No one will be watching next year for the H-M ad and no one will miss it if they are smart enough to save their money in 2013.

Another likely set of losers belong to Hollywood. As producers continue to produce films aimed at small markets (R-rated = restricted audience) and/or low quality (Adam Sandler), only a minority of the audience will care. Worse, movie trailers are already readily available to movie-goers. Hence, the entire exposure is pretty much wasted. The intended audience has already seen it or will see it soon.

Not many would be surprised if we conclude that some members of Hollywood suffer from pride, which would explain a lot of why the networks can continue to raise Super Bowl ad rates and advertisers continue to pay them.

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Kirk Wakefield, editor of “The Migala Report” (www.migalareport.com) is the Edwin W. Streetman Professor of Retail Marketing at the Hankamer School of Business at Baylor University. His work on sports and entertainment marketing appears in leading academic journals, as well as a textbook, “Team Sports Marketing” (www.teamsportsmarketing.com). At Baylor, he has developed the Sports Sponsorship & Sales program and its advisory board of 35 major league teams, and the Music & Entertainment Marketing program with its own student-run entertainment company and record label (www.uproarrecords.com).