Super Bowl Sunday is the most important day of the year for marketing companies.
The culmination of the NFL season offers an audience unlike any other television event. Last year's battle between the Seattle Seahawks and Denver Broncos, which quickly turned into a snooze-fest for everyone outside of Seattle, drew an average of 111.5 million viewers, a new TV record, per CNN.com. According to Nielsen's numbers, it was the fifth time in six years a new record was set.
For companies looking to market to a wide-ranging audience, the Super Bowl is the obvious avenue. But according to CNN's Frank Pallotta, 30 seconds of ad space during this year's game will cost $4.5 million, marking the third-straight year the price has increased by $0.5 million.
Companies seem to believe the value outweighs the cost, though. Per Pallotta, 95 percent of the ad space had been purchased as of early January.
"This should be the biggest day in advertising," NBC executive vice president Seth Winter told Pallotta. "Everyone knows that is what the game is worth."
Of course, $4.5 million isn't cheap, and many companies have scaled back this year. According to Advertising Age, Anheuser-Busch, Coca-Cola, GoDaddy and T-Mobile have all purchased less space than last year. Car companies will also be far less visible, with General Motors, Ford and Audi all sitting the game out.
It's easy to see why many companies have opted out. Combine the $4.5 million buy-in with the cost of making a commercial (north of $1 million in some cases, per Siltanen & Partners founder Rob Siltanen, via Forbes.com) and steep audience standards (and thus potentially negative reviews), and it's an extremely costly risk many aren't willing to make.
That said, there are plenty of reasons to justify the cost, as well. In 2014, a study of 37,440 participants by BrandAds concluded that Super Bowl ads actually increase the likelihood of viewers to purchase the product by 6.6 percent.
If this year's Super Bowl draws the exact same audience from last year (111.5 million), the $4.5 million equates to about four cents per viewer. As Siltanen argued, gaining that kind of visibility is priceless:
And, for good marketers with smart and creative ad agencies, the Super Bowl is one the safest bets I’ve ever seen. What other venue better assures that people are going to watch your commercial or talk about your brand more than being on the Super Bowl? What other venue says you’re a first-rate, big-time, trustworthy brand more than the Super Bowl? What other place allows you to catch the eyes of 108 million men and women with one fell swoop?
Many newcomers are banking on the fact that Siltanen is correct in his thinking. With many companies dropping out, 15 new advertisers are set to join the game, including Jublia, a toenail fungus treatment (because obviously), Loctite—the maker of Super Glue—and Avocados from Mexico. The latter may just steal the show with Doug Flutie, Jerry Rice and a rhinoceros:
"I'm always excited by the rookies [because] you get to see some of them hit it out of the park, and others make classic rookie mistakes," Northwestern University marketing professor Derek Rucker told Newsday's Verne Gay.
As advertisers attempt to justify the steep cost, commercials have transformed into mini pieces of cinema. Many ads are hilarious, others are emotional and some feature popular celebrities and well-known characters, ranging from Aubrey Plaza to James Bond.
So, even though the landscape of TV is always changing—DVRs, new options for streaming content, etc.—Super Bowl Sunday will continue to serve as an endless stream of entertainment well beyond the actual game.
Marketers—despite the cost—are making sure of that.