Despite National Football League estimates that 130 million people in the U.S. alone would be watching Super Bowl XXXV this past Sunday, mutual fund companies did not rush to buy advertising during the game that was to be televised on CBS.
Among mutual fund companies, it appeared prior to the broadcast that only INVESCO Funds of Denver and AIM Management of Houston bought advertising time during the game. For both companies, it was to be the first time they advertised during the Super Bowl, according to the companies.
CMR, an advertising research company in New York, said that an average 30-second commercial spot during this year's game cost approximately $2.3 million.
During the game, INVESCO was to introduce its third in a series of 30-second "Masters of the Game" commercials. The commercial, produced by The Richards Group of Dallas, consists of clips of football coaching legend Bill Walsh discussing his approach to success.
In the ad, Walsh likens having knowledge with having an edge on the competition, the company said. The new commercial was not available for viewing prior to the game. The ad was scheduled to run nationally.
"The Super Bowl was a perfect venue for a coach who had won Super Bowls as a coach for the San Francisco 49ers, and participated as assistant coach in two more," said Mike Malone, creative director for The Richards Group.
Two previous television commercials INVESCO has been airing - one with former tennis champion Chris Evert and the other with former Boston Celtics' basketball star Bill Russell - have similar themes, according to the company.
AIM chose to air its newly-produced 30-second TV commercial in just two areas - its hometown of Houston and in Austin, Texas.
Also using a well-known athlete, the commercial stars Justin Leonard, the 26- year-old golf pro. Leonard first attracted attention by winning the British Open in 1997 but is best known for sinking the winning shot for the 2000 Ryder Cup Team, said Marilyn Miller, a spokesperson at AIM. The commercial, which was made in December, was not available to be seen before the Super Bowl.
Two other television commercials AIM is currently airing and also using the "Discipline Creates Performance" theme, star Lance Armstrong, a cancer survivor and the only American to win the Tour De France bicycle race, and Mia Hamm, a member of the U.S. winning World Cup soccer team in 1999, said Malone.
In each AIM commercial, the athletes wordlessly train in their respective sports.
"1,400 hours of practice a year" is written on the Hamm commercial, followed by "300 training days a year", then "1 explosive right foot." An announcer follows with the phrase "Discipline creates performance." The performance of an AIM fund is then shown as the announcer suggests viewers contact their financial advisor to learn more. The announced then says, "The idea is discipline. The purpose is performance. The name is AIM."
The company decided to run the Super Bowl ad locally for two reasons, said Miller.
"We decided not to do it on a national level because it didn't make sense with our budget," she said. She declined to disclose what AIM had paid. But, the cost of the local Super Bowl spots was "very reasonable," she said.
AIM's advertising budget for 2000 and 2001 is $16 million per year, Miller said. But, this year's budget could be increased later in the year, she said.
By limiting its advertising to one 30-second spot in each of the two local viewing markets, AIM hoped to capitalize on its hometown advantage, Miller said.
"It's something that makes AIM look big in our hometown," she said.
AIM's commercial was also produced by The Richards Agency. Both AIM and INVESCO are subsidiaries of AMVESCAP of London so it is not surprising that they would use the same ad agency.
While the two companies have separate identities and marketing initiatives, executives at the two companies do discuss their strategies, said Miller. And, they often obtain discounts by using the same agency, she said.
AIM, with $183 billion in assets under management, predominantly sells its funds through banks and broker/dealers. INVESCO, with $56 billion in assets under management, primarily sells directly and only recently began selling through intermediaries.
The cost of Super Bowl advertising time has risen steadily in the past several years, making fund companies' decisions whether to advertise during the game more difficult, said Miller.
Total Super Bowl ad spending rose to $78 million in 1999, according to CMR, an advertising research company in New York. That is almost double the $39.6 million companies paid for Super Bowl advertising in 1990, said the company.
The average cost of a 30-second commercial spot on the Super Bowl was $1.3 million in 1998, rose to $1.6 million in 1999, and to $2 million in 2000, according to CMR.
CMR estimates that 2001 Super Bowl advertising rates rose 15 percent, pushing the average cost for a 30-second spot to about $2.3 million this year.
While the price tag may be high, the benefits can be even greater, according to some advertising executives.
"It is a very efficient media buy if the [target] market matches the demographics of the game," said Tim Clarke, president of Clarke Advertising and Public Relations in Sarasota, Fla. While most companies considering a Super Bowl advertisement focus on the multi-million dollar price tag, they should focus on the cost per thousand viewers, he said.
"It's a way to get a big impact," he said.
In addition, the most important messages companies that advertise on the Super Bowl send are not in the ad but in the fact that the company is advertising during the event at all, Clarke said.
"It tells people you are a player; that you are substantial," he said.
But, other advertising executives question the value of Super Bowl advertising.
"Most commercials - nine out of 10 - don't work," said Peter Krieg, executive vice president of Copernicus Marketing, a marketing consulting firm in Westport, Conn. "The return on advertising has been abysmal." Over the past five or six years, the return on sales has been one to four percent on average, he said. "You would definitely be better putting that money [spent on advertising] into a very conservative mutual fund," he said.
Nuveen Investments of Chicago, the only fund group that advertised last year during the Super Bowl, did not advertise this year. Last year, Nuveen ran a widely-criticized ad in which Christopher Reeve, the actor who was paralyzed in a horseback riding accident, appeared to miraculously rise from his wheelchair and walk unassisted. Angela Thomas, a spokesperson for Nuveen said the decision not to advertise this year had nothing to do with the controversy over last year's ad.