Economics of a Super Bowl Ad

So I've been doing some reading on prices of Super Bowl ads. These two were the most interesting:

Super Bowl Ad Prices Drop
Stock Price Correlated to Likeability of Super Bowl Ads


So evidently, even the market for Super Bowl ads has been hit by the economic downturn. But why are prices this high anyways? According to the article, the average price for a 30 second ad during the Super Bowl is $2.5 million. The average price for non-Super Bowl ads is around $350,000. In other words, the price you pay for a Super Bowl ad is around 7.14 times what you pay for a normal TV ad.

Now let's consider the issue from a viewership standpoint. According to the above article, the expected viewership for today's Super Bowl is around 100 million people. Now, let's look at figures for something comparable. According to Nelsons Rating data for the week ending January 31st, the top viewed program was the "NFL 2010 AFC-NFC PRO BOWL," generating 12.3 million viewers (this is way above viewership for the State of the Union, by the way, which generated a paltry 5.7 million viewers). If we analyze the viewership data, we find that viewership for the Super Bowl is approximately 8.13 times that of a normal, highly watched football game. 

An even more convincing relationship shows if we analyze the issue from the perspective of advertising dollars per viewer. From the Super Bowl data, the price would be around 2.5 cents per viewer. For the non-Super Bowl data, the price is around 2.8 cents per viewer. 

Keeping in mind that some people (like me) watch the Super Bowl purely for the commercials, and it's safe to say that buying 30 seconds on the Super Bowl can even be a good deal. Rather than being overpriced, the price of 30 seconds for a Super Bowl ad is pretty much the same if we consider it from a per viewer basis instead of a per time basis.

The second article is really just a reminder that investment ideas come from the strangest places. If you see any great commercials, don't forget about the company behind the commercials (I will personally be keeping an eye on Godaddy.com).

It just goes to show that economics can be found everywhere.