Despite a $10 Million Price Tag, Super Bowl Ads Are Still Worth It

January 31, 2019
Updated 3mo ago

By Michelle Castillo

Although it has 3 million customers, home security company SimpliSafe isn’t a household name yet. It’s hoping that will change on Sunday after its first Super Bowl ad airs.

“In a market where people are trying to lock you in a contract or harvest your data, we’re trying to keep you safe,” brand creative director Wade Devers told Cheddar. “There aren’t really a lot of places you can reach the number of people you can reach like the Super Bowl.”

SimpliSafe's ad, which was created by advertising agency Preacher, is big bet for any company. Ads cost slightly more than $5 million dollars per 30 seconds, according to industry sources. After you consider the additional cost of hiring stars, licensing material, and orchestrating social media posts, sources said costs balloon to a range of $10 million to $20 million, on average.

“We’re in the business of delivering an audience, and it’s true TV viewing is more fragmented than it’s ever been,” said Jeremy Carey, managing director of sports marketing and media agency Optimum Sports.

“The reality is if you look at the reach and scale and the ability to put out one message to a massive audience, the Super Bowl is still it.”

The Super Bowl matters more than ever

A little under half of adults between 22 and 45 do not watch TV on traditional platforms and opt for streaming platforms and other viewing methods, according to a study by marketing agency Hearts & Science.

Last year’s Super Bowl attracted its smallest audience since 2009, or at about 103.4 million viewers, Carey said.However, it was still the tenth most viewed live event in TV's history. It garnered 170 million social interactions, more than seven times the number of interactions on the subject of last year's Academy Awards.

“You used to be able to run an ad in any number of primetime shows, and you could reach this mass scale of people at the same time with sight and motion,” said Jeff Gagne, senior vice president of strategic investments at media agency Havas Media. “There’s just fewer and fewer opportunities to do it.”

Still, the astronomical price tag of a Super Bowl campaign is a deterrent for many smaller brands. To be truly effective, the Super Bowl campaign needs to still be promoted after the game, adding even more to the budget. On top of that, expectations are impossibly high ー and brand use their best material to stay competitive.

“You’ll have to fight to be the best ad among a bunch of good ads,” advertising agency Walrus co-founder and chief creative officer Deacon Webster explained. “Usually you’re fighting to be a decent ad behind a bunch of terrible ads.”

Further complicating the matter, the ads don't always lead to direct sales immediately; No one sees a car ad and buys one the next day, Webster said.

“It’s not like people are going to see a Super Bowl ad and buy the product the next day,” Webster said. “You need to be in it for the long-term.”

Making the brand

Super Bowl ads have the most utility for companies that are trying to introduce themselves or a new product, Havas’ Gagne said.

One such example is Anheuser-Busch, which is trying to introduce its customers to the beverage giant's new alcoholic seltzer.

Only 40 percent of people know it exists, said Chelsea Phillips, Vice President, Beyond Beer Brands at Anheuser-Busch. Anheuser-Busch’s Bon & Viv Spiked Seltzer (formerly SpikedSeltzer) is looking at the Super Bowl as an opportunity to educate the public. Bon & Viv’s commercial, which was created by agency Bullish, features mermaids pitching sharks about its hard seltzer “Shark Tank”-style.

Its target customer is a mid-20s woman making more educated decisions about what she’s drinking, Phillips said. But Bon & Viv started notice a very wide range of men and women are interested in their zero-calorie beverages early last year, widening the demographic.

“This is a very competitive space,” Phillips said. “There are very countless seltzers in the market… We wanted to be bold. Our company Anheuser-Busch has exclusive access to that game, but also it’s a lot earlier than our competitive set starts to advertise.”

M&M’s is similarly using its Super Bowl airtime to introduce a new product, M&M’s Chocolate Bar. The ad was created by agency BBDO New York, and features actress Christina Applegate chauffeuring around the iconic M&Ms who are stuck in the back seat ー literally.

“At the end of the day, [a Super Bowl ad] signals I’m serious about my business, and I’m serious about my brand,” said Allison Miazga-Bedrick, brand director for M&Ms.

Sports and award shows are two of the events that people still want to watch live, Miazga-Bedrick said. And people love watching Super Bowl ads.

“Consumers are looking for advertising,” she said. “In today’s digital world, that happens less and less.”