The $2.4 Million Question: What is the ROI for Super Bowl Ads?Published: February 23, 2005 in Knowledge@Wharton
On the Monday following the Super Bowl, players and coaches are not the only ones scrutinizing the game highlights. With much at stake, advertisers and their ad agencies also play Monday morning quarterback, scanning popularity polls, buzz meters, and Internet blogs to determine the success or failure of their super-expensive 30-second spots. Up for grabs is the coveted "water cooler" factor, the kind of groundswell that in years past has made the "wazzup" guys and Monster.com household names.
But is $2.4 million for 30-seconds (up by $100,000 from last year's game) really worth it? After all, you may remember the "wazzup" guys, but do you remember the product they were selling? By and large, though, academicians and practitioners alike tend to agree that, with a few caveats, Super Bowl advertising is worth the cost. That said, the first and fairly obvious downside to this ad venue is that a company is paying for a huge audience. If its product is regional or limited to a small segment of the population, "the danger is that you are paying for a lot of people who may not be your direct target audience," says Wharton marketing professor David Reibstein.
Ken Kaess, CEO of DDB Worldwide, which produced 14 of the commercials that ran on this year's Super Bowl, agrees. "It's certainly not the right thing for every client, but it's a great place to be if you want to reach an extremely broad target audience." The Super Bowl's unique role as the venue to premiere commercials makes advertising there even more valuable, Kaess adds. "It's one of the few, if only, events in the U.S. that people actually tune in to watch the commercials. I know it sounds ironic, but it's probably one of the more efficient media buys out there."
According to Kaess, it's nearly impossible to put a value on the pre- and post-game publicity. "It just gets an incredible amount of coverage, and it's increasing more and more every year." A poll conducted by the Retail Advertising and Marketing Association found that among those people who planned to watch the Super Bowl, 32.5% thought the game was the most important reason to watch, while 15.7% tune in explicitly for the commercials. Among the coveted 18- to 24-year-olds, that number was 24.5%. "Most of the time a commercial comes on and it's a good time to get some food or go to the bathroom. In the Super Bowl, you can't afford to leave during the commercials, because that's the best part," says Reibstein.
All the buzz around the commercials means that advertisers are getting free publicity on top of their paid ads. Reibstein sees a clear trend focused on advertisers mounting significant public relations campaigns around the ads themselves. "The ad itself may not be worth the spend," he says, "but if you can get someone else to show your commercial for free, that's wonderful."
Joseph Cappella, professor of communications at the Annenberg School, believes that the buzz is even more valuable than the commercials themselves. "You have newspaper articles and programs discussing which were the best ads. And the question is, 'Will the media interest actually produce interest in your product?'" The answer, says Cappella, is yes. "Whether it's real interest or media interest is almost irrelevant ... Just like the political debates, it's the spin that the media puts on it that determines peoples' attitudes toward who performed well." In other words, the winner is who the media tells us it is.
And what the media has told us so far is that two commercials from Ameriquest Mortgage -- in which the ad campaign theme ("Don't judge too quickly; we won't") was illustrated in two humorous scenarios -- were among the most popular ads of the show, ranking second and ninth in USA Today's Ad Meter, despite the relative obscurity of the company. The spots were done by the Los Angeles office of DDB Worldwide. Other winners involved humor and patriotism. Anheuser-Busch's ad showing a pilot jumping out of a plane for a six-pack of Bud Light scored first on the Ad Meter. Another Anheuser-Busch ad, this one featuring soldiers walking through the airport to a standing ovation, ranked third. Also in the top 10 were three ads from CareerBuilder.com, which featured jabbering chimpanzees as unproductive office workers; another Anheuser-Busch ad featuring a man at a game who sees a cell phone photo of his girlfriend at home with another man; and ads for Emerald Nuts and Pepsi.
Another indication of ad popularity came this week from comScore Media Metrix, a division of comScore Networks, which measures website audiences. In its analysis of the online impact of the Super Bowl, comScore reported that many advertisers registered huge increases in visits to their websites. Traffic to Budweiser.com, for example, jumped 600% on Super Bowl Sunday, the biggest increase registered, followed by GoDaddy.com, with a 378% jump, Olympusamerica.com with 363%, Apple iTunes with 172%, and Cadillac.com with 171%. According to comScore Networks, consumers have come to expect that "many Super Bowl commercials will deliver a call to online action, whether to learn more about an intriguing product, enter a sweepstakes or make sense of a purposefully vague advertisement."
Of course the buzz not only generates interest in the advertisers' products, but in the agencies that create the spots. DDB Worldwide's Kaess says the Super Bowl puts ad agencies under the microscope. "You know that what you are creating is going to be watched by the largest TV audience in the U.S. And you've got to try to top last year's commercials ... It's a stressful time of year for the creative guys. If you do a great commercial, everybody sees it. And if you do a bad commercial, everybody sees it." Has the agency won new clients as a result of its Super Bowl ads? "Absolutely," says Kaess. "We had Capital One call us after seeing ads we did on the Super Bowl and say, 'We want to go with you.'"
Interestingly, the definition of a good ad or bad ad is quite fluid, says Kaess, and very much hinges on the moral compass of the country. Janet Jackson's "wardrobe malfunction" last year and the general mood of the country meant that advertisers were a bit more gun shy this year, choosing the high road over lower forms of humor. "We are in the business of entertaining people and being creative," says Kaess. "When you do that, you are always pushed to the edge, and the edge is continually redefined. Post 9/11, there was a different edge that you could push compared to 9/10."
Indeed, after groups sensitive to victims of sexual abuse complained, Ford pulled a commercial it planned to premiere on the Super Bowl that featured a minister being tempted by a new pickup truck. And Anheuser-Busch chose not to air a Bud Light spot that spoofed the Janet Jackson mishap, deciding instead to premiere it on the Internet. According to Kaess, whose company produced the spot: "It was a huge publicity generator for us. The first day on the site it had something like 250,000 additional hits. It was the best decision we could have made for it."
The Consumer as "Guest"
After all of the polling and the best and worst are decided, it comes down to the consumer and whether he or she goes out and buys the product. The consumer truly is in charge, says Kaess. "There are so many opt-out technologies available to you: You can TiVo out your commercials, cut out spam on the Internet, and so forth. Consumers really control what they want to see." He says that his company used to call consumers "targets," because they were something you pointed at and hit. "Now we call them 'guests,' because basically we have to be invited, and we invite them to join the brand experience."
Wharton marketing professor Leonard Lodish believes that consumers need to be put back into the equation when it comes to TV advertising. Based on ad data from the past 25 years, Lodish believes many advertisers are throwing their money away on ads that don't speak to the consumer. He says that one need only look at split cable tests -- where researchers monitor the commercials a household views and then tracks its buying patterns -- to see that some ads do really well at changing buying patterns and others don't. "A lot of agencies, if they weren't so macho, would take the time to properly test commercials," says Lodish. As it is, he says, most testing (if there is testing) usually consists of quick-and-dirty focus groups rather than longer-term quantifiable testing.
When discussing Super Bowl ad efficacy, Annenberg's Cappella goes back to the buzz factor. "The issue is not whether these commercials lead the consumer to buy," he says, "but whether they lead to more discussion." He points to the Ameriquest ads, which had to convey a fairly complex message in a short time. When people are sitting around drinking beer and eating chips, he says, they will not do the kind of mental processing required to make sense of the ad. But if the ad turns out to be popular and memorable (which it was), people will talk about it the next day, and it will be replayed over and over. "You really need that second step to allow for more deliberation and deeper processing. That's what solidifies an ad."