In 2016, 111.9 million people tuned in to witness the Denver Broncos defeat the Carolina Panthers in the historic Super Bowl 50. However, the milestone faceoff was especially significant in terms of advertising, as costs for a 30-second midgame commercial averaged $5.0 million. This record is anticipated to be exceeded in 2017 as despite consistent price hikes, many companies continue to invest in midgame advertisements in hopes of leaving a lasting impression on the millions of game viewers. IBISWorld has broken down the five sectors expected to benefit most off Super Bowl advertisements in 2017.
The automotive sector
Companies in the automotive sector typically spend the most on Super Bowl advertisements. Operators in the industry spent $86.4 million spent in 2016 alone, as seven automakers across the Car and Automobile Manufacturing and SUV and Light Truck Manufacturing industries, including Fiat Chrysler Automobile and Toyota, purchased commercial spots. Additionally, foreign automakers, which dominate the US auto market, have increasingly invested in Super Bowl advertising, accounting for more than three-fourths of auto ads in 2016.
Moving forward, despite improving economic conditions, Car and Automobile Manufacturing industry operators have recently experienced volatile sales, driving many of which to reevaluate their spending. As a result, many automakers have purchased shorter Super Bowl commercials or in some cases, passed on advertising altogether. Nevertheless, increases in disposable income and consumer confidence are expected to benefit the automotive sector, allowing it to maintain its top rank in 2017.
The food and beverage sector
In 2016, the food and beverage sector spent $67.2 million on Super Bowl advertising as demand increased for snack foods and soft drinks due to increased disposable income. Additionally, increased digital advertising has encouraged companies in the Soda Production and Snack Food Production industries to spend more on Super Bowl advertising (accounting for 18.1% of total ad spending in 2016). For example, in 2016, PepsiCo spent $19.2 million on Super Bowl ads, 40.0% of which was spent on digital platforms, such as Snapchat and other social media.
Also included in this sector is beer. Over the past five years, Anheuser-Bush, which comprises nearly 50.0% of the Breweries industry, has spent the most on Super Bowl beer advertisements; shelling out $33.6 million for three and a half minutes of ad time in 2016 alone. Due to a multiyear contract with the NFL, which extends through 2022, Anheuser-Busch is the only beer advertiser permitted to use the Super Bowl logo and the logos of NFL teams on its products. As a result, all Anheuser-Busch brands, including Budweiser, Bud Light, Busch and Michelob Ultra, will maintain prominent Super Bowl commercial slots in the next five years. However, increased craft beer popularity could threaten Anheuser-Busch’s dominance in both the Breweries industry and in Super Bowl advertising following 2022.
The technology sector
In the past five years, IBISWorld estimates that the number of US broadband connections has risen 10.0%, which in turn drives demand for technology sector services, such as online tax software, website and domain development software and mobile service providers. Consequently, companies in the Website Creation Software Developers and Tax Preparation Software Developers industries, such as Wix.com and TurboTax, have increased Super Bowl ad spending. Additionally, the number of mobile device-related advertisements has also grown. For example, in 2016, Deutsche Telekom (T-Mobile’s parent company) spent $14.4 million on ad time, up from $8.8 million in 2015. Over the next five years, IBISWorld anticipates the percentage of services conducted online, as well as the number of mobile internet services to rise significantly. As a result, the technology sector’s share of Super Bowl advertising is expected to continue to grow.
The media sector
During Super Bowl 50, the media sector, which includes the Movie and Video Production industry, spent $28.8 million on advertising. However, spending by industry operators has been volatile in the past five years as more people have opted to watch movies at home, negatively affecting industry demand. Additionally, industry operators typically only purchase Super Bowl advertisements when they have a movie with strong box office potential to promote. Nevertheless, the media sector remains a top Super Bowl advertiser due to video equipment innovation, which enables production studios to make bigger, more sophisticated films, thus requiring more promotion.
The financial sector
The financial sector includes companies in industries such as Credit Card Issuing, Commercial Banking and Life Insurance & Annuities. Over the past five years, companies in this sector have significantly increased their advertising spending; purchasing 3:45 minutes of ad time in 2016 alone. This is due to recent increases in disposable income and consumer confidence, which encouraged consumers to purchase more big-ticket items, such as new houses and cars, which often require insurance. This bolstered insurance sales, encouraging insurance companies to spend more on advertisements for large events such as the Super Bowl.