Every year on Superbowl Sunday, many people crowd around the television to watch the “Big Game”. For many, though, the actual game is not their focus. Many people anxiously await the exciting or funny advertisements that make their debut during America’s most-watched event. The simplicity of an advertisement, and the 123.7 million viewers for the 2024 Super Bowl, as stated by AP News, makes for a uniquely profitable business model.
Due to the high viewership, placing these advertisements comes with a hefty price tag, as the average price in 2024 for a 30-second advertisement was about $7 million according to Statista. While this sum might seem a ridiculous amount, for many aspiring companies, it is the best chance to reach as many viewers as possible. According to AP News, the sport has had a 10% increase in viewership over the last year. This increase in NFL viewership is in direct juxtaposition with viewership for other major leagues, such as the National Basketball Association and Major League Baseball, which have had a steadily declining viewership for the past 5 years. This increased company exposure gives companies more incentive to buy an ad spot during the Superbowl over any other major sporting event. Furthermore, a limited supply of slots is available for each Superbowl, creating a low supply while still keeping a high demand. All of this validates the need for a price increase for these precious slots.
As viewership has grown, the prices of ads have as well. On a small scale, the growth seems small from year to year; yet, in the past 20 years, the average price has gone from $2.2 million in 2004 to a whopping $7 million in 2024 — a growth of about 218% in 20 years, well exceeding the 63% inflation that has occurred during that period. So, what else is causing this drastic price increase? It would be fair to attribute this increase in price to an increase in potential advertisers and increased viewership, yet the true reason is simple: a narrative. In recent years, advertising has changed drastically from a simple form of enticing to something more like a story. For example, during this year’s Super Bowl, a storyline began when State Farm, an insurance company, began to post on social media about an upcoming film they were going to release known as “Agent State Farm”. This movie had intense trailers, and at the end of each post, it would tell the viewer to look out for the commercial during the Superbowl. This is a prime example of a narrative used by a company to capture the attention of possible viewers. On the other hand, in the past companies like Allstate in the early 2000s would air their typical advertisements that had already been used. The older commercials lacked storylines for viewers and therefore lacked the attention of modern advertisements.
For many companies, the possibility of gaining publicity rather than customers works. Commercials, like the State Farm example previously noted, have drawn massive viewership even after the Superbowl due to featuring popular celebrities or TV personalities. Simply put, this increase in production has led to a drastic price increase as companies compete to gain the most publicity possible in the shortest time frame available. Due to this, the obvious choice for many companies has become a Super Bowl advertisement. The prospect of publicity, combined with increased viewership and increased competition between advertisers, has resulted in price increases unlike any other event in the world.
| Inflation rate between 2004-2024: Inflation calculator. $200 in 2004 → 2024 | Inflation Calculator. (n.d.). https://www.officialdata.org/us/inflation/2004?amount=200 |
Majidi, M. (2024, February 7). Super Bowl 30-second ad costs 2024. Statista. https://www.statista.com/statistics/217134/total-advertisement-revenue-of-super-bowls/
Nerkar, S. (2024, February 6). $7 million for 30 seconds? to advertisers, the Super Bowl is worth it. The New York Times. https://www.nytimes.com/2024/02/06/business/super-bowl-commercials.html#:~:text=A%20decade%20ago%2C%20the%20average,broadcast%2C%20the%20competition%20is%20fierce.
Reedy, J. (2024, February 13). Super Bowl was the most-watched program ever in the US, averaging 123.7 million viewers. AP News. https://apnews.com/article/super-bowl-ratings-2024-chiefs-49ers-cbs-e2f0288ea474bd564ee4df430e41b8bd
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