Behold the Power of a Super Bowl Ad

(Bloomberg Opinion) -- This Sunday, the New England Patriots and Los Angeles Rams will face off in Super Bowl LIII to compete for the title of National Football League champion. But as always, a set of deep-pocketed corporate sponsors aims to take home the real prize.

The Super Bowl is the U.S. advertising event of the year. For many brands, it’s the kickoff of a campaign to introduce a new product or revive a tired one. Makers of everything from beer and detergents to SUVs and even an online-dating app hope their comical or inspiring ads will be memorable enough to drive purchases by some of the 100 million or so viewers of the big game. Last year, the average rate for a 30-second Super Bowl commercial was a record $5.24 million, according to Kantar Media, versus just $625,000 for an ad spot during a regular-season NFL game. In all, more than $480 million was spent on ads tied to last year’s Super Bowl.

The improvement is especially great news for Kellogg Co., the parent of Pringles, which has suffered a 19 percent drop in its share price over the last six months — one of the worst returns among consumer staples in the S&P 500 index. Pringles was acquired by the cereal giant in 2012, joining a portfolio of food brands that lost market share under Kellogg’s watch, including Kashi, Morningstar and Keebler. The chips are ready to return to the TV screen during this Sunday’s game with a new spin on the “flavor stacking” ad campaign, noting that there are 318,000 possible flavor creations. Whatever works!

Similarly, Reckitt Benckiser Group Plc’s Mucinex cold-and-flu medicine debuted at last year’s Super Bowl to draw attention back to the brand as it faced pressure from cheaper private-label competitors found on drug-store shelves. It ended up having perhaps the most memorable ad of the night because it touched on what most partied-out football fans were thinking in that moment: calling in sick to work the next day. 

A 30-second Super Bowl ad spot this year cost $5.1 million to $5.3 million, people familiar with the matter recently told Bloomberg News, a sign that prices may have peaked as fewer people tune into the big game. Even so, the event will be key for advertisers. During the past 12 months alone, at least 200 corporate earnings calls or investor conferences — excluding those for media companies — made some reference to the Super Bowl, according to transcripts compiled by Bloomberg.

Of course, ads can only do so much to help a mediocre product. Jack in the Box Inc., a fast-food chain that’s been losing customers to cheaper and trendier rivals, delivered a sassy Super Bowl spot last year in which its mascot, Jack, provokes a fight with Martha Stewart, swearing that his Asian-fried chicken sandwich is every bit as good as hers. Lenny Comma, the chain’s CEO, said it was “breakthrough advertising,” but the sandwiches themselves “weren’t flavorful enough,” so they didn’t drive much repeat restaurant traffic. Now, under pressure from activist shareholders and frustrated franchisees, the company is exploring a sale. 

The Super Bowl still has enough reach that when competitors buy ads, the companies who don’t can get a bit prickly over it. My favorite part of looking back on the impact of last year’s Super Bowl commercials was the hilariously defensive rant it prompted from Church & Dwight Co.’s leadership about the intricacies of treating stains. Some of the household-products manufacturer’s larger rivals had purchased air time, including Henkel AG’s Persil detergent brand, which had an ad about guacamole making an ill-fated landing on a shirt (Church & Dwight makes OxiClean). Anyway, Church & Dwight’s serendipitously timed earnings call the next day became a thing of beauty:

“So, coming back to the Super Bowl and our competitors, and you might have seen ads about clean clothes or about one type of stain, which was, I think, avocado. Let me talk you through how we as the leader in stain management are actually targeting. Stains are much more complicated than you think. So now during Super Bowl time you might have pizza stains, so you might have dip stains or whatever was on your Super Bowl menu. But when it becomes to maybe March/April, better weather, you're going to actually have grass stains or dirt skirt stains. During the course of the year, different stains become more prevalent. … And if you've been a new parent, you know that, for once, spinach stains and carrot stains start to dominate your life, things you never dealt with before. So stains vary by the season, by the type of person you are and by your life stage. … So we have whipped up OxiClean a great campaign which can target every single type of stain, and because the product has such great performance, consumers actually write to us and share their successes.”

Unlike the guacamole stain, the Super Bowl ad blitz has certainly left a lasting mark in the past, and this year should be no different. The question is, as younger generations become less captivated by the big game, will there always be a Super Bowl effect? 

To contact the editor responsible for this story: Beth Williams at bewilliams@bloomberg.net

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Tara Lachapelle is a Bloomberg Opinion columnist covering deals, Berkshire Hathaway Inc., media and telecommunications. She previously wrote an M&A column for Bloomberg News.

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