Does a $3M Super Bowl Ad Make Sense in a Recession?
|Derek D. Rucker|
So it isn't surprising to see big-name advertisers backing away from Super Bowl XLIII. FedEx and GM, for example, are both taking a pass for the first time in many years. Indeed, one wonders if even more advertisers would be backing out if given the opportunity; a majority of spots were purchased and locked in prior to the unsettling October crash.
This begs the question: With the economy unraveling, does a $3 million Bowl spot make any sense?
Answering that question starts by recognizing that many of the key facts surrounding the Super Bowl have not changed.
First, the Super Bowl remains the single best means to reach a large national audience in a single shot. Last year's Super Bowl drew a staggering 97.5 million viewers -- the largest audience for a televised event in more than two decades. The second-most-watched event in the past decade: the Super Bowl in 1996.
Second, the Super Bowl remains a venue for which the audience, a captive one at that, shows a genuine interest in the advertising.
Third, participating in the Super Bowl is not solely about purchasing a 30-second spot but about the buzz beyond, both around the water cooler and online.
Creative that entertains: FedEx (top), Bud (middle) and Coke ads from the 2008 Super Bowl.
But advertisers face a unique set of challenges this year -- challenges that make deciding on a Super Bowl ad buy all the more difficult.
The biggest issue, of course, is the the economy and its impact on companies' financial results. With credit scarce and demand shrinking across virtually every category, companies need to focus intently on preserving cash. This is not the time for discretionary spending; every dollar of spending needs to drive the business.
Another issue is tone. Traditionally, Super Bowl advertisers battle to stand out by being funny and entertaining -- for example, last year's Bud Light, FedEx and Tide to Go spots -- or dramatic and impressive, such as last year's Coke, Audi and Under Armour spots. In an economy where people are deeply concerned about the future, it is unclear if either approach will resonate.
Finally, a Super Bowl ad buy might send the wrong signal to employees, customers and other stakeholders. For a company laying off employees and making difficult spending cuts, this sort of investment might create a negative backlash if the message isn't right.
Should you buy a spot this year? Depends on the goal. Is the objective a short-term sales jump? Or to build a brand for the long-term?
|ABOUT THE AUTHORS|
Tim Calkins is a clinical professor of marketing at the Kellogg School of Management at Northwestern University.
Derek D. Rucker is an assistant professor of marketing at the Kellogg School of Management at Northwestern University, where he teaches advertising strategy.
Another point to consider is your target audience. Typically, upscale consumers seek premium brands and products. In contrast, both upscale and downscale consumers use everyday products and services. Even a CEO or investment banker delights in an occasional jaunt to McDonald's.
In hard economic times, this effect is magnified. Downscale consumers are less likely to trade-up to premium brands and services but upscale consumers are more likely to trade down to more-casual or -generic ones. Look no further than Walmart or McDonald's to see that downscale brands have fared relatively better than their upscale counterparts, such as Target and Starbucks, in this downturn.
Finally, another consideration: There are two types of advertising messages on the Super Bowl: news and bravado. Messages related to news focus on something of note, such as a product launch or even a new benefit. Messages linked purely to bravado focus on entertainment and creative impact alone.
When facing a recession, bravado is a risky approach because the link to the product tends to be weak. Indeed, managers who focus on bravado messages are likely to find themselves walking tightropes of scrutiny, where observers banter about whether the brand is signaling economic strength or financial foolishness.
Managers should focus on conveying news about the brand -- a new product, a new position or even a new, entertaining way to reinforce the established positioning of the brand. For example, Monster will use the Super Bowl to introduce its new website; Hyundai will focus on its new high-end vehicles; and Bud Light will emphasize "drinkability." Infusing spots with some form of news will give consumers a reason to buy the product and justify the spending to employees and other key constituents.
The cost of entering the Super Bowl is always something that should give brand managers pause. For the right brand, it can absolutely be the right choice, but for the wrong brand, it can be a financial mistake and a public-relations fiasco. This year managers thinking about a Super Bowl ad buy should focus more than ever on having clear objectives, broad appeal and high news value.