With almost four months remaining before the Super Bowl, NBC has sold nearly all of its available commercial time during the big game, thumping expectations despite a significantly weakened advertising market.
The network said in mid-September that nearly 85 percent of its available time slots have been sold, with strong categories that include automobile ads and movie previews. A dozen 30-second commercials sold for a whopping $3 million apiece, a figure that is up 10 percent from last year. According to MSNBC.com, the network has around 10 time slots still available. With a high demand for air time from revenue-hungry advertisers, NBC could command even more money for each time slot that is yet to be bought out.
Normally, only about 60 percent of Super Bowl ad slots get sold by this time of year, when professional football’s final bout is still more than four months away.
The Wall Street Journal reported earlier on the development via its website.
Sports have been a rare bright spot for media companies facing declining ad revenues this year due to the rapidly weakening economy. Although television ratings have been dropping for years as audiences turn to video recorders and alternative viewing platforms such as computers and Apple’s iPods, people still want to watch big-time, televised sporting events live and on high-quality screens.
Viewership for NBC, a unit of General Electric Company, was better than expected during the Olympic Games and exceeded the minimums NBC guaranteed advertisers. This allowed the network to be able to free up time slots it had reserved to make up for any shortfalls.
NBC reported that it had sold $25 million in ads during the Olympics. This figure does not include the unfathomable $1 billion or more the network made on ads sold before the Games had even begun. NBC hopes that revenues for commercial time slots during the Super Bowl can match those staggering figures on an ad revenue per hour basis (The Olympics lasted for a total of over two weeks. The Super Bowl is televised for maybe four to five hours. Ad revenue per hour gives the network a general idea of the relative earnings when comparing two or more events).
The overwhelming amount of money that ad slots during the Super Bowl are sold for is constituted based simply on the huge amount of people who view the biggest game of the year in professional sports.
The Super Bowl is single-handedly the most viewed, televised program year in and year out. Over 100 million people view the contest yearly. This colossal amount of viewers compiles a wide range of targeted consumer groups that advertisers can appeal to. This is why commercials during the Super Bowl are among the most effective forms of ads.
Commercials during the big game have quickly become a part of Super Bowl culture and lore. A large amount of people who tune in for the Super Bowl have reported that they look forward to the entertaining, well-thought advertisements that appear during breaks in the game. Companies are all but guaranteed that the products and services they offer will be immediately pushed upon potential customers through their ads during the Super Bowl.
The sports business is a proven moneymaker. While other markets’ revenues via advertisements are at a steady decline, the sports business is booming and is at a high point. This is despite declines in attendance of major sporting events throughout the country.
The decline in attendance could, however, have a positive impact on revenue earned through sports marketing and ads. More people are viewing games at home, on television, and through other platforms, which invites companies to advertise in commercials on television, and also over the internet and radio.
Super Bowl commercials show how effective ads on television can be if there is a significant number of people tuning into the broadcasted sporting event.
Sports marketers will continue to find new ways to generate revenue through advertisements at, during, and through sporting events, as well as through sports merchandise. The field of sports marketing will continue to grow and prosper in the future as sport is becoming, and probably already is, one of the most successful, highest earning businesses in the market today.
-Chris Barfield (Information and statistics obtained primarily via The Wall Street Journal.)