Average Cost of 30 Second Super Bowl Ad Grew 87% Over Past Decade To All-Time High of $5.05 Million in 2017
Record cost of commercial time helped last year’s game generate $534 million in pre- and post-game advertising – more than the total revenue for a week’s worth of programming on all four networks combined
New York, NY, January 18, 2018
– Against a backdrop of declining regular season ratings and increasing controversy, the NFL will stage Super Bowl LII in Minneapolis on February 4th
with the game still far and away the premier event in the television landscape.
An analysis by Kantar Media of the growth of the Super Bowl over the past decade documents why the game is an advertising juggernaut and how it is growing, even this year, as the league and professional football in general faces challenges.
Price of Advertising Continues to Climb...
The average price for a 30-second commercial in last year’s Super Bowl game reached an all-time high of $5.05 million, up 87 percent during the past decade. It’s the most expensive air time on television by far. (The next two most costly properties in 2017 were the NFC Championship at $2.5 million per :30 and the Academy Awards at $1.9 million).
Ad pricing is negotiated and therefore individual marketers can pay different amounts. Some of the common factors affecting the actual rate include the amount of commercial time purchased, where spots appear in the game and whether the advertiser opts for a larger package that includes units in the pre-game and/or post-game coverage.
Ad pricing has been racing past million dollar intervals at an accelerating pace. It took just four years, from 2013 to 2017, for Super Bowl ad prices to jump from $4 million to $5 million per :30 spot. The jump from $3 million to $4 million also took four years (2009 to 2013). By comparison it took nine years (2000 to 2009) to get from $2 million to $3 million.
The rising cost of commercial time has led to more revenue. The Super Bowl generates some staggering figures. In 2017 sponsors paid $419 million for in-game messages, including spots purchased on contingency that aired during the game’s climactic overtime period.
When pre- and post-game programming is included, the 2017 grand total swells to $534 million for the one-day sporting event. To put this amount in perspective, it’s more than the combined ad revenue of the four major broadcast networks in an average week for their entire programming schedules. It also exceeds the full-year ad revenue of many cable networks.
Commercial Time Has Expanded
Ad revenue growth has also been aided by increased commercial time. The 2017 contest contained 51 minutes and 30 seconds of ad messages between the opening kickoff and the final whistle, including a two minute ad break in the overtime period. It was the second most cluttered broadcast in the 51-year history of the event.
Our tabulation of commercial time in the table below includes promotional announcements from the network for its own shows. These typically account for about 15 percent of total ad time and 25-30 percent of all spots in the game.
The Super Bowl now contains 15-20 percent more commercial time than a regular season NFL game and the gap has been creeping upwards over the past decade. In 2008 the Super Bowl contained about 3 more minutes of ad time than a regular season game. In 2017 the comparable difference, after excluding the extra messages in the Super Bowl overtime period, was more than 7 minutes.
Longer and Shorter Commercials
Perennially the most common length for an in-game Super Bowl commercial is 30 seconds. Despite the high price of ad time some marketers have chosen to spend even more and show longer length commercials that tell a deeper story and further engage viewers. This strategy reached a zenith in 2014 and 2015. In 2017 a more fiscally conservative strategy burst forth: the use of 15 second messages. They accounted for 15 percent of brand spots in the game, the highest ratio since at least 1995.
The fact that less expensive :15 spots were so prominent in the year that :30 ad rates surpassed $5 million may – or may not – have been a timing coincidence. Short ads were used by well-known brands with hefty marketing budgets (P&G Tide, KFC, Pepsi, Amazon Echo) and also by smaller, relatively less familiar advertisers (Fiji Water, Wonderful Pistachios, Wargaming,net).
Top Five Super Bowl Advertisers
The largest advertising positions in the Super Bowl tend to be held by well-known marketers. In a typical year, the top five spenders account for about 30 percent of total ad revenue even as the makeup of the group changes.
Anheuser-Busch In Bev was the leading advertiser in 2017 with expenditures of $35 million. The beer maker has placed in the top two of the annual rankings for at least 36 consecutive years.
Deutsche Telekom ranked second with $30 million of spending for the T-Mobile wireless brand. Procter & Gamble ($25 million) and Fiat Chrysler ($20 million) were third and fourth, respectively. Prior to 2017 Fiat Chrysler has been a Top Two advertiser in the Super Bowl for five consecutive years.
The roster of Super Bowl advertisers undergoes change from year to year and the replacement pipeline has been delivering a steady stream of first-time participants who believe they can create and execute a successful strategy for their brands. In last year’s game, 20 percent of the parent companies were Super Bowl rookies.
The 2017 freshman class had representation from diverse categories including Travel (Airbnb and Turkish Airlines), Mobile Gaming apps (Top Games USA and Wargaming.net) and Personal Grooming products (It’s A 10 Hair Care and Proactiv).
Do freshman marketers return as sophomores to the following Super Bowl? The odds are against it. Over the past decade, more than 60 percent of first-timers were on the sidelines the next year.
David vs. Goliath
The enormous price of Super Bowl ad time would seem to be a barrier to small marketers with limited budgets, especially when you consider that air time is just a minimum entry fee. There’s also the cost of commercial production, the price tag for social media promotion plus outlays for other marketing elements to complement the in-game spot.
Nonetheless, the annual lineup of Super Bowl advertisers includes companies who invest a hefty chunk of their annual media budget to purchase commercial time. In 2017 there were 11 marketers who put more than 10 percent of their full-year paid media budgets into the game. It was the second highest number this century, exceeded only in 2010 when 13 advertisers surpassed the 10 percent threshold).
The most leveraged sponsor in the 2017 game was 84 Lumber. Its $15 million purchase of a 90 second spot represented over 70 percent of its annual measured ad expenditures.
Auto Is The Top Super Bowl Advertising Category
In recent years the Super Bowl has been a regular destination for a number of different automotive, movie studio and beverage companies, making these the most populous and competitive ad categories.
Auto manufacturers have had the largest footprint for eight consecutive years even though the category’s presence has recently shrunk. In 2017 seven auto makers ran ads and accounted for 17 percent of all expenditures, the smallest share since the 2010 game.
Movie studios use the Super Bowl to promote upcoming theatrical releases that have strong box office potential, thus justifying the high price of commercial time. The volume of advertising in this category can swing sharply from year-to-year because of its dependency on studio’s release schedules. In each of the past three years at least six different films have been promoted.
Soft drinks from Coca-Cola and Pepsico have also been long-time sponsors but in last year’s game they faced new competition from other non-alcoholic beverages (Fiji Water and Bai Fruit Juice).
How Large Is The Super Bowl Versus Other Sport Franchises?
Despite the handicap of being a single-game event, the Super Bowl holds its own against the multi-game championship series of other professional sports leagues when it comes to TV ad expenditures. In most years ad spending in the MLB World Series and the NBA Finals has significantly lagged the Super Bowl’s haul.
However, the World Series has recently caught up and achieved record-setting ad revenues in each of the past two years. It was aided by the double bonus of playing the maximum possible seven games and having compelling story lines and appealing matchups that generated exceptionally large viewing audiences -- and higher ad prices. The 2017 Fall Classic brought in $414 million from national TV sponsors versus $419 million for the 2017 Super Bowl.
As impressive as these amounts are, they’re still way short of the nearly $2 billion of TV ad money generated by the 2016 Summer Olympics, an event with more than 1,000 hours of program coverage.
About Kantar Media
Kantar Media is a global leader in media intelligence, providing clients with the data they need to make informed decisions on all aspects of media measurement, monitoring and selection. Part of Kantar, the data investment management arm of WPP, Kantar Media provides the most comprehensive and accurate intelligence on media consumption, performance and value.
For further information, please visit us at www.kantarmedia.com