It's hard to believe that Super Bowl XL was almost a year ago, and that we’re about to see a new spate of enhanced and extended commercials this coming Sunday. Color commentary of the commercials is at an all-time high, and most of it is positive: critics see great opportunities for branding that will consume not only ad time during the game, but reach out to consumers through Internet sites and other media. Last year's spots, like most years, delivered a consistent dose of boobs, buzz and buffoons to try and catch our attention. I wrote back then that I believed the Super Bowl was an opportunity for companies to waste money on advertising that did no good for their businesses. "I can’t think of a more egregious example of the inanity of traditional advertising," I declared, confidently. I also promised to revisit the performance of the top 15 advertisers on the Bowl, to see if there was any correlation between the ads and subsequent sales. Of course, I couldn’t hope to draw a direct connection; rather, my suspicion was that choosing to advertise on the Super Bowl -- in keeping with all of the soaring vagaries of branding that the experts promote -- was evidence of a plain, bad decision, and a likely indication that the companies were 1) probably making other bad decisions, and thus 2) maybe in trouble overall. Well, with another round of high-flyer branding activities soon to debut this coming Sunday, I thought it only prudent to revisit my claims, and test my suspicions. And the facts are solidly...inconclusive.
About half of the companies went on to have a good or great 2006, either across their businesses or via the specific product line(s) they advertised on the game. The other half either did badly, or their reporting (or other activities during the year) made it impossible to tell if the advertised products/business did well or not. Is there a correlation between deciding to advertise on the Super Bowl and other marketing decisions? If so, is that necessarily a good or a bad connection? Most branding activities aren’t reported separately, but are buried in one or more expense lines. So it's really hard to make anything more than indirect connections to business performance, and based on my admittedly rough methodology, the connection may or may not be made on an operational or managerial-level basis. We're left with what we're always left with: qualitative judgments power the cases for most branding. For instance, CareerBuilder claimed that last year's Super Bowl ad 'paid for itself' after a few weeks of new people visiting its site. That’s great evidence of awareness, and I'm sure it helped fuel their intentions for more expansive plans around this year’s game. But whether on my TV or on my computer, is awareness of boobs, buzz, and buffoons enough?
Here are the factoids I used to categorize '06 performance for the top 15 advertisers on Super Bowl XL: Budweiser: Improved year over terrible '05, but '06 domestic volume was still down below '03. They had lots of price pressure, and marketing/sales costs were up, so it’s hard to say they're doing the right things. THUMBS DOWN FedEx: Delivered a 10% revenue increase, and with margin flat-ish, EPS was up 7%. But the real and perhaps most meaningful variable here was (and is) fuel costs, so there's no way to determine what the business would have done irrespective of it. WHO KNOWS? Sierra Mist (Pepsico): 3Q06 operating profit down due (in part) to incentives costs, and Sierra Mist was referenced as a 'slight' contributor to company performance. THUMBS DOWN CareerBuilder: Not a public company, but said that after the game last year that visits 'paid for ad in a few weeks.' The company runs a lot of other online lead generation. THUMBS UP (although with only circumstantial evidence) Sprint: 3Q06 operating income, earnings from existing operations, and EPS all flat or down. The company cites acquisition costs and lots of other complexities in its performance. THUMBS DOWN Dove: Owned by Unilever, which is a gigantic conglomerate that delivered so-so performance overall (Dove not mentioned in color commentary in 3Q06 release). Dove had the very visible 'Real Beauty' campaign during the year but, like the Super Bowl, it's hard to know what did what. WHO KNOWS? Sharpie: Made by Newell Rubbermaid, which reported sales increases of its office products division, along with a consistent margin that suggests that they didn’t have to 'buy' sales with price breaks. THUMBS UP (although with indirect numbers only) Nationwide: Revenues were flat as of 3Q06, and earnings were down. THUMBS DOWN MasterCard: Revenues & earnings were up 3Q06, and its overall costs were down. This is another really complicated financial reporting picture, but the basic numbers seemed clear. THUMBS UP Disney: Revenues & earnings were up for 2006. There is so much Disney in the mediascape that it's probably impossible for outsiders to separate the good from the bad. So let's assume it's all working. THUMBS UP Honda: 1st half of its fiscal year revenue & operating income were up (Automotive division in North America). THUMBS UP Ford: Reported a full-year net loss of $12.7 billion. 'nuff said. THUMBS DOWN GM: Not as bad a Ford, but with revenue flat and earnings down, it begs the question 'why do so many car commercials look the same?' THUMBS DOWN Toyota: A consistently positive business performer, with automotive revenue up 14% and operating income up 37%. THUMBS UP Bayer (Aleve): Overall conglomerate performance up, and unlike any other products business, it reported individual product line sales (21% increase for Aleve). THUMBS UP