GO
Loading...

Sticker shock: $4 million for 30-second Super Bowl ad

Inside the advertising industry, the Super Bowl has long been the "game within the game." Every year, while the NFL's last two teams standing battle it out for the Lombardi Trophy, dozens of marketers compete to capture the most eyeballs among the game's 100-million-plus television viewers. At least, that's how it used to be.

The big game itself is basically the same as when the Packers defeated the Chiefs to claim the first AFL-NFL World Championship in 1967, yet the ground rules for Super Bowl advertisers have dramatically changed over the past few years, squarely because of the game-changing influence of social media and online teaser ads. For Super Bowl XLVIII the tried-and-true model of creating a 30-second spot to debut during halftime—with hopes of generating the most Monday-morning watercooler buzz—is the equivalent of a leather football helmet.

And that's not just because the price tag for a half minute has escalated from $42,000 in '67 to this year's record $4 million, a number the game's broadcaster, Fox, neither confirms nor denies. CBS reportedly garnered $3.8 million for a 30-second spot a year ago, but several factors would seem to justify Fox's rate hike, including the probability that XLVIII's viewership will almost certainly surpass last year's 108.4 million and perhaps break the 111.3 million mark set in 2012.

(Read more: Bud Light gets a Super Bowl makeover)

Largest media market in history

"The sheer scale of the audience is obviously unmatched in our business," said Michael Mulvihill, senior vice president of programming and research for Fox Sports, "but it's not just the size of the audience. It's the engagement and the attentiveness and the fact that the entertainment value of the advertising is such an essential part of our presentation."

Although some past Super Bowl advertisers are passing on this year's telecast—notably E*Trade, Best Buy and Subway, whose CMO was quoted as saying "the pricing has gone crazy"—most are buying what Fox is selling. "There is sticker shock," observed James Cooper, executive editor of Adweek, "and a lot of guys have said, 'Enough already; I can't justify that cost.' But you've got two big-market teams, both with national appeal, and Peyton Manning with a lot of national appeal. Couple that with the fact this it's in the largest media market, in New York, and you're going to get a big audience."

Even so, the Super Bowl has become much more than a one-day buy. "Our approach this year is fundamentally about playing a different game," said Seth Kaufman, vice president of marketing of colas for Pepsico North America Beverages. "To get the right leverage out of the investment, the right tailwind for our business, it's about extending beyond Super Bowl Sunday and making it a month-long campaign."

Advertisers rarely quote their precise Super Bowl investments—Kaufman's "significant" is standard—though Pepsi's budget for its multimedia campaign is undoubtedly astronomical. That covers not just a pair of 30-second ads during the first half that hype Pepsi's sponsorship of the 12 ½-minute halftime show but also ads during the NFL playoffs and the Grammy Awards, a surprise concert in Nebraska, a Carol Channing sighting at a seniors' bingo game and other terrestrial promotions.

(Read more: 15 most bizarre Super Bowl bets)

Buzz mass marketing 101

The Bud Light Super Bowl ad, featuring Arnold Schwarzenegger, on YouTube
Source: Bud Light | YouTube
The Bud Light Super Bowl ad, featuring Arnold Schwarzenegger, on YouTube

Then there's the incremental investment Pepsi made in its complex social media campaign and online teasers. It's the rapid emergence of that digital arena that marketers covet in their quest to generate a virtual watercooler buzz well before the Broncos and Seahawks line up for the opening kickoff.

"There's a whole marketing ecosystem that's developed underneath the game," Cooper claimed. The traditional, high-stakes pressures of getting an ad in the game and making sure it works still apply, he said, but now advertisers are compelled to "tap social media, which can extend the profile of their investments."

So in addition to vying for the cleverest, most memorable tagline, there's corporate combat to generate the hottest Twitter hashtag. Bud Light, for example, has a trio of ads to introduce a new mouthful—"The Perfect Beer for Whatever Happens"—aiming to supplant the brewers' four-year run of "Here We Go." That effort also includes teaser ads on TV and online, starring Arnold Schwarzenegger, Don Cheadle and comedian/musician Reggie Watts.

Yet the Anheuser-Busch InBev brand is banking a lot on social media, too. "Social media has given us the opportunity to expand the spots well beyond the game broadcast," said Rob McCarthy, vice president, Bud Light. The strategy calls for the new tagline to "set up an expectation for the unpredictable; then the hashtag #UpForWhatever will be used leading up to and during the game in interesting and unexpected ways," he explained.

(Read more: Brands plan mega bashes for Super Bowl 2014)

Calculating Advertising ROI

Chobani "How Matters" ad on YouTube
Source: Chobani Yogurt | YouTube
Chobani "How Matters" ad on YouTube

Beyond the cola wars and beer wars, this dual marketing approach will be deployed in this year's yogurt wars, as Dannon's Oikos and Chobani face off to claim the Greek hilltop. Oikos is bringing back Full House actor John Stamos, who starred in a 2012 spot, but this time reuniting him with fellow cast members Bob Saget and Dave Coulier. Chobani, meanwhile, is loaded for bear, or actually with a very hungry 1,375-pound brown bear that's come out of hibernation and ransacks a small-town grocery store before finding a just-right cup of Chobani—honey-flavored, of course.

The 60-second spot—a first for the brand, as well as for the initial Super Bowl ad from its agency, Droga5—introduces Chobani's "How Matters" campaign, which will build with new ads during the Olympics and Academy Awards. Social media matters as well. "We used to have talk value," said Chobani CMO Peter McGuinness. "With social media, we have communication value."

Social, in turn, has created a new opportunity to measure value and ROI, to get even more bang for the massive Super Bowl bucks. "TV fees have risen commensurate with the audience, while social vehicles have grown exponentially," McGuinness adds. "So if I can leverage both in concert, the math falls in line on our total investment."

Regardless of the media vehicles that get them to and from the Super Bowl, advertisers still anxiously await the post-game polls, surveys and other metrics that proclaim winners and losers, which with the new rules in the advertising game are all the more intriguing. "What's neat about the Super Bowl is that you're really see where marketing is today," says Tim Calkins, professor of marketing at Northwestern University's Kellogg School of Management, who's produced an annual review of the effectiveness of Super Bowl ads since 2005. "You know that people with big budgets are on the game, and that everybody is putting forth their best effort. So it's a great reflection of trends in marketing.

—By Bob Woods, Special to CNBC.com

Contact CNBC Explains

  • CNBC NEWSLETTERS

    Get the best of CNBC in your inbox

    › Learn More

Latest Special Reports

  • With the world becoming more interconnected, it’s getting harder to anticipate and manage global risks. We take a look at some of the biggest risks and ways to mitigate them.

  • From family-run companies to public companies with family ownership, we tackle challenges and rewards facing family businesses.

  • Inside the market's biggest sectors with a look at the trends, companies and trades netting profits for investors.

Central Banking Explained

Corporate Accounting Explained