Would You Pay This Much for an Ad?

[KristineS]

I've been seeing a lot of buzz about the Super Bowl in my marketing newsletters the last few days. Apparently 80% of the ads for the game have already been sold and about a dozen or so ads have been sold for 3 million dollars each.

Would you pay that much for one 30 second ad? Do you think an ad in the Super Bowl is worth 3 million dollars?

[cbscreative]

Let me check my account...

Nope, I would not pay that much. Although the ads are a big draw, I'm not all that excited that if I buy the products I am essentially helping to pay for those ads and the grossly excessive sports salaries. I share the perspective of many others who feel this is a bit out of control.

I heard a comparison before about baseball salaries from the 1960's vs. today. In the late 60's the average professional baseball salary was about 10 times the average person's income. Although you could even question if it should have been that high, look how they compare to average person's income now. I have no idea what the historical ratios are for football or other sports.

[Dan Furman]

I don't really think sports salaries are out of control. It is *so* hard and rare to make it in professional sports - these guys are the best of the best of the best. It's WAY beyond "they are just playing a game"... if one thinks that, one must also think all I do (for example) is "tap keys". It's what the market will pay, so I don't think it's out of line - someone is going to make that money. Yea, they could all make less and lower ticket prices, etc, but why should they? The stadiums look full to me - must not be *that* expensive.

In fact, I'm happy that the "revenue producing" employees in sports actually get a large piece of the pie.

GO JETS!!!

[cbscreative]

Dan, I agree with you in one sense at least. In the past, the large sums of money were being made by promoters, and people like athletes and actors were getting a pretty raw deal by comparison. The pendelum has now swung the other way, but everyone has their own opinion on whether that is too far the other way or not. It certainly reflects in ticket prices. Like you said, the stadiums are full so why should they change? But it can create a hardship for the average worker to afford those rates.

Personally, I'm mostly unaffected by it, accept for if I buy products that support the system, because I'm not a sports fan and don't go to stadiums. But I do recognize that many would like to go to the games and can't. Compare that to 30 or 40 years ago when it was more affordable to Joe Average, and you might conclude that things are out of balance. Then again, maybe that's progress. It certainly is reality regardless. Fortunately for Joe, at least he should be able to get a big screen TV, so things are not as terrible as they could be.

Besides, the right or wrong about these salaries may never be solved, and everyone certainly does have an opinion about it. As for me, I shall keep plunking on the keyboard, drawing, creating and brainstorming, and try my best to get overpaid for it. I expect you to do the same since you are also skilled at pressing those keys.

[KristineS]

I guess I tend to look at the cost of the Super Bowl ads from a return on investment standpoint. I know these ads generally get reviewed and talked about more, but is a company really going to get 3 million dollars worth of publicity or sales out of their ad? It doesn't seem likely.

[Evan]

I think that $3 million is outrageous. I certainly wouldn't pay it, but it's great money considering the number of people your company would reach out to.

Dan -- that's the problem. Sports should be a form of entertainment, to take your mind off your every day problems. To me, I don't think sports is really a career and I think parents who want their kids to be good so they can "make it big" are really missing the point. But I do acknowledge that I'd rather the money go to the athletes than the "managers", but I still think it's a rip-off. The stadiums would be even more full of ticket prices were more reasonable.

[Dan Furman]

But it can create a hardship for the average worker to afford those rates.


This is a common argument, but I'm not sure why the average worker should expect to get in reasonably.

It's like eating out - instead of Tavern of the Green, I might go to a restaurant more in line with my budget. In as far as sports, I watch on TV rather than go to the game - much more comfortable (and again, much more in line with my budget.)

sorry all - don't mean to hijack, but this is something I'm somewhat interested in :)

[vangogh]

Super Bowl commercials are out of reach of most obviously. Is $3 million worth it? Who knows. Your ad will be seen by the largest audience any tv program will get for the year. On the other hand advertising typically works best when it's done consistently.

One thing in favor of Super Bowl ads is it's perhaps the one time of year where people actually want to see ads.

Lots of companies have certainly wasted their money on Super Bowl ads, but I think a company like GoDaddy helped build their business. I'm not sure how many people really knew who they were prior to their first Super Bowl commercial.

I'm completely with Dan on sports salaries. I have no problem with athletes making as much as they can. Each of us has the opportunity to go work for the highest bidder. Why should athletes not have the same right. Sports creates a lot of wealth for the various leagues and teams and also creates jobs in related fields. Ultimately it's the athletes who are bringing in that money. Why shouldn't they profit.

Evan ticket prices have little to do with packed stadiums. Put a winning team on the field year after year and you'll sell out your stadium. It's also not true that all tickets are expensive. Most every baseball stadium I'm aware of reserves same day tickets. Granted they aren't the best seats, but they're usually cheap.

Back in college, when I was in Philadelphia, I could see a game for the price of $1. That's what ticket cost in the upper deck behind home plate. Those tickets aren't $1 anymore, but you can still get into most stadiums for $10 I think. At most $20 will be you a tickets. That's not a lot.

[cbscreative]

Back in college, when I was in Philadelphia, I could see a game for the price of $1. That's what ticket cost in the upper deck behind home plate. Those tickets aren't $1 anymore, but you can still get into most stadiums for $10 I think. At most $20 will be you a tickets. That's not a lot.
Maybe that's not a lot, but if you're talking about 20 or 30 years ago, imagine if everything else had gone up at proportionately the same rate. We all know income has not gone up that much, but too many expenses have gone up disproportionate to income, and this is only one example, but an extreme one. If anything, that makes more of a case for those who believe this is excessive.

[vangogh]

The $1 ticket was about 20 years ago, but you can still find tickets for $5 or $10. Since I'm Colorado I'll use the Rockies as an example. Here's the page to buy Rockies tickets (http://colorado.rockies.mlb.com/ticketing/singlegame.jsp?c_id=col). At the bottom of the page is a graphic of the stadium along with ticket prices for each section.

Rockpile seats (in Centerfield) cost $4. Are they the best seats? No, but you can still see the game and have a good time. So the equivalent of my $1 ticket from 20 years ago now goes for $4.

Look at all the tickets you can get for $25 and under. It's really not that expensive to see a game. It is when you only look at the high end of ticket prices.

[cbscreative]

Well $4 now compared to 20 years ago is more in line with everything else, but your $10 number seemed like a steep increase when I read it, and reminded me of other numbers I've heard. Not being a sports fan, I don't keep up with these prices too much.

[vangogh]

I wasn't sure what the cheap seats went for since I don't buy those anymore. I wanted to say $5 originally, but I wasn't 100%. Once I looked it up though there were $5 tickets to be had.

My real point though was that when people talk about how expensive it is to go to a game they often look at the high end of prices. It might be $5 for center field seats, but it will set you back a few hundred to sit directly behind the plate. Still an average family can still go to a game if they want.

Now I do think other sports charge more. You won't find $5 tickets for a football or basketball game.

[Ad-Vice_Man]

I've actually talked about this before... perhaps not on this forum... but from a cost per exposure perspective, $3Million for a superbowl ad is one of the most efficient ads available... however the "cost of entry" is beyonf what a small or middle market business can return on. But if you think of the multiple millions of dollars that Budweiser, Microsoft, Miller, Coke, Pepsi etc spend in a given year and the fact that they can and do sell to a national even international audience, as part of their advertising plan it makes alot of sense. how many cokes do you need to get a return on a $3,000,000 advert? 3,000,001 at a dollar a piece... I imagine Coke has no trouble getting a return.

We talk about this alot on this forum... the cost of the ad versus the cost per exposure and the Return on investment. Usually it's the other way around. the low "entry cost" ad, that barely reaches anyone and persuades few. This is the same model... just in inverse.

[KristineS]

When you look at it from that perspective, it does make more sense. You're right, large companies with national or global reach could attract enough customers to make a decent return on the investment. Plus the Super Bowl ads are the only ads I know of that are reviewed and discussed in other places. So not only do you get the actual airing in the game, you usually get collateral discussion in other places.

I guess, from my perspective, 3 million is a lot of money. From Coca Cola's perspective, it's a drop in the bucket.