Costing $7 Million Each, Super Bowl Commercials Are More Expensive Than Ever

Super Bowl commercials are more expensive than ever. But for advertisers, they’re also a better deal than ever before.

NBC — the network that will broadcast this year’s game — announced that sales to advertisers sold out last week. Several 30-second ads sold for a record $7 million each.

But why would advertisers spend $7 million on an ad? Because it’s the Super Bowl — a broadcast that’s still watched by around 100 million viewers, even as ratings for some other major sporting events are dropping.

“Nothing in the media world comes close to giving companies the exposure the Super Bowl can. This is increasingly important as the media landscape becomes more fragmented,” according to Patrick Crakes, a former executive at Fox Sports.

“The fractionalization of attention because of streaming and social media makes the Super Bowl more important than ever,” Crakes said, speaking to CNN Business. “If you do business with the NFL and you’re advertising during the Super Bowl, you’re a real player.”

Crakes added that there are also examples of the football league final match “helping build brands.”

“Think of a company like GoDaddy. GoDaddy invested in the Super Bowl for years, did a lot of crazy things to get attention and that helped their business,” he said. “I think it’s a great investment, even at this price.”

Revenue close to $500 million

The Super Bowl — and the ads that go with it — are also a great investment for networks.

We still don’t know what NBC will do in terms of ad revenue for this year’s broadcast. However, it will likely be a considerable change, according to Tim Calkins, a professor of marketing at Northwestern University’s Kellogg School of Management.

“You’re probably selling about 70 ads, so you’re approaching $500 million in ad revenue from the game for NBC,” Calkins told CNN Business.

“And that, by the way, is only during the game. That doesn’t count before and after the match and every other opportunity that exists to run additional publicity,” he added.

Last year’s Super Bowl brought in $434.5 million in in-game ad revenue, according to research firm Kantar. That’s more than baseball’s World Series Finals and basketball’s NBA Finals, and second only to the Olympics, which take place over a period of weeks.

Kantar noted that this year’s game — which pits the Cincinnati Bengals against the Los Angeles Rams — is expected to surpass last year’s numbers. (NBC shares Super Bowl rights with other NFL TV partners every two years.)

“$500 million is a lot of money for anyone, but in the media world, Super Bowl ads are on another level,” Calkins said.

“That’s why the NFL is such a valuable sports franchise, because there’s this ability to charge advertisers so much to participate in these events,” he said.

more than a game

TV is undergoing a rapid transformation due to the streaming revolution, but the NFL remains one of the audience bases of traditional networks in the United States.

League viewership for the 2021 regular season is up about 10% from last year, bringing in an average of 17.1 million viewers per game.

That’s the highest regular-season average since 2015, according to the league, and comes at a time when ratings for other big live events — like prize pools — are experiencing record lows.

Calkins explained that for networks like NBC, there are “two big benefits” to doing business with the NFL and broadcasting the Super Bowl. The first is ad revenue surplus and the other is that the broadcaster will “use this opportunity to support the rest of its programming” through pre-, during and post-game promotions.

“For NBC, the Super Bowl is an event they can use to kick-start their programming for the rest of the year,” he said.

Calkins remembers that a few years ago, people said the Super Bowl was going to disappear. “It’s getting unsustainable. It’s completely the opposite”, that’s what they said.

However, according to him, the Super Bowl is increasingly important because it is a shared experience.

“The interesting thing is that a lot of people who are watching the Super Bowl don’t even care about the outcome of the game. They are watching the ads,” she concluded.