Home About Archives RSS Feed

The Independent Investor: The Business of the Super Bowl

By Bill Schmick
iBerkshires Columnist

It is one of the few businesses that continues to grow year after year. Whether one looks at the ads, the attendance or the number of television viewers, the Super Bowl has survived where others of its species have died off. It is truly one of the last mass-audience live television events of our society.

Super Bowl XLVII will be played on Sunday, Feb. 3, in the Mercedes-Benz Superdome in New Orleans. It will mark the 10th time the "Big Easy" hosted the event. The last one was in 2002. It could mean as much as $450 million in business for the city.

Now, that would only be half as much as New Orleans has spent preparing for the game. The city spent more than $1 billion on infrastructure improvements, including renovations at the airport, a new streetcar line, and enhancements to the Superdome itself. After the devastation of Katrina, New Orleans needed to rebuild and have used a number of major sporting events, including the NCAA men's basketball Final Four in 2012, a couple of BCS National Championship Games and the NBA All-Star Game in 2008 to do just that. But the Super Bowl is the big jambalaya in the menu of possible events.

Experts say that for every $100 spent in the city, about 50-70 percent remains there, while the rest leaks out into other surrounding locales. New Orleans, like other cities who have hosted the event, is hoping that by putting their best foot forward, they will convince some of the attendees to remain and even establish businesses in the areas.

Given that the attendance at the Super Bowl is largely a corporate event, businesses get first choice of rooms, flights, special events and just about everything else involved in the Super Bowl and the days surrounding it. The chance to shine cannot be underestimated and the city fathers know it.

For those of us unable to attend the live event, all is not lost. We can look forward to countless parties (either at home or your favorite bar or cafe), root for your favorite team, dance to the half-time show (Beyonce will man the stage this year) and, of course, watch the commercials.

Americans continue to watch the Super Bowl in record numbers. More than 46 percent of TV households watched last year's game, according to Nielsen, which makes it just about the most watched broadcast in U.S. history. And the wealthier you are, the more likely you are to tune in. For advertisers, who strive to reach the age demographic of 18-49 years old, the Super Bowl is the best game in town.

It is probably why Super Bowl ads keep climbing in cost. Ad slots for this year's game sold out at the asking price of $3.5 million per 30-second spot by December. That is up from $3 million/spot last year. But corporations will pay it because there is a gold mine for those who can come up with the right ad.

This year, viewers will see some big names populating the ads. Singer Beyonce, hip-hopper Jay-Z, supermodels Catrinel Menghia, Bar Refaeli and Kate Upton. And that is only a taste of the lineup. Personally, I will be looking forward to the return of the French bull dog, Mr. Quiggly, (which replaced Kim Kardashian in a Skechers' ad). Last year he captured the hearts, minds and pocketbooks of many of us.   

There will also be a number of new ad sponsors this year including Oreos. For me, the day after the event will be as much about my favorite commercial than it is the game. That's why the Super Bowl has become such a business generator for corporations.

Given that the ads are 58 percent more memorable than your average TV commercial, I can see why. If you doubt that, just recall the ad with the little boy dressed as Darth Vader. I bet you can even remember what auto manufacturer sponsored it. That company reaped a cool $100 million in free publicity from the spot, which is not bad for $3.5 million investment. When it comes to the Super Bowl, what is good for business, is also good for America, so let the games begin and the cashier register ring!

Bill Schmick is registered as an investment adviser representative with Berkshire Money Management. Bill’s forecasts and opinions are purely his own. None of the information presented here should be construed as an endorsement of BMM or a solicitation to become a client of BMM. Direct inquires to Bill at 1-888-232-6072 (toll free) or email him at Bill@afewdollarsmore.com.


News Headlines
NBCC Hosts Forum on Youth and Substance Abuse
North Adams Airport Commission Unhappy With Delayed Ramp Completion
MCLA to Host Open House for Prospective Students
North Adams Happenings: Oct. 26-Nov. 1
BCC Honors Academic Achievement at Convocation
Investors Should Avoid 'Great Expectations'
Williamstown Students Celebrate Words With Costume Parade
Pittsfield Council Adopts 'No On 2' Resolution
North Adams Council Gives Final OK on DPW Building Borrowing
Lanesborough Approves Large Increase In Tax Rate

Bill Schmick is registered as an investment advisor representative and portfolio manager with Berkshire Money Management (BMM), managing over $200 million for investors in the Berkshires. Bill’s forecasts and opinions are purely his own and do not necessarily represent the views of BMM. None of his commentary is or should be considered investment advice. Anyone seeking individualized investment advice should contact a qualified investment adviser. None of the information presented in this article is intended to be and should not be construed as an endorsement of BMM or a solicitation to become a client of BMM. The reader should not assume that any strategies, or specific investments discussed are employed, bought, sold or held by BMM. Direct your inquiries to Bill at 1-888-232-6072 (toll free) or email him at Bill@afewdollarsmore.com Visit www.afewdollarsmore.com for more of Bill’s insights.




@theMarket (213)
Independent Investor (294)
October 2016 (1)
October 2015 (2)
September 2016 (9)
August 2016 (5)
July 2016 (7)
June 2016 (7)
May 2016 (5)
April 2016 (7)
March 2016 (8)
February 2016 (5)
January 2016 (5)
December 2015 (6)
November 2015 (6)
Debt Ceiling Fiscal Cliff Stock Market Debt Recession Selloff Pullback Rally Economy Currency Metals Election Retirement Deficit Bailout Europe Stocks Commodities Federal Reserve Oil Greece Taxes Housing Energy Stimulus Crisis Interest Rates Congress Europe Banks Euro Wall Street Jobs Markets Japan
Popular Entries:
The Independent Investor: Don't Fight the Fed
The Independent Investor: Understanding the Foreclosure Scandal
@theMarket: QE II Supports the Markets
The Independent Investor: Does Cash Mean Currencies?
@theMarket: Markets Are Going Higher
The Independent Investor: General Motors — Back to the Future
The Independent Investor: Will the Municipal Bond Massacre Continue?
@theMarket: Economy Sputters, Stocks Stutter
The Independent Investor: Why Are Interest Rates Rising?
The Independent Investor: How Will Wall Street II Play on Main Street?
Recent Entries:
@theMarket: Day Traders Rule the Markets
The Independent Investor: Dementia & Your portfolio
@theMarket: The Same Old Song
The Independent Investor: The Impact of One Bad Apple
@theMarket: Much Ado About Nothing
The Independent Investor: Woman Need to Invest More
@theMarket: Markets Get Back to Business
The Independent Investor: The VA — If It Isn't Broke, Don't Fix It
@theMarket: A Tale of Two Interest Rates
The Independent Investor: The VA — Political Football