Is March Madness Marketing's New Super Bowl?
NEW YORK -- ( MainStreet) -- March Madness is a bracket full of marketing opportunity for NCAA basketball tournament partners, sponsors and companies looking to cut in on the Big Dance.
Within the past decade alone, the tournament has drawn $5.2 billion in television advertising revenue from 275 different broadcast sponsors, according to Kantar Media . Last year alone, revenue jumped 20%, to $738 million. The 78 advertisers who jumped aboard in 2011 were the fewest the tournament has seen in a decade, but the haul was even bigger than the previous tournament-record $643.2 million brought in by the event in 2008.
"College sports in general, but especially March Madness, deliver that core component that you have to have in sports marketing, which is passion," says Bill Glenn, senior vice president at sports and entertainment marketing firm The Marketing Arm . "You want to talk to consumers about what their passion is, and that passion in the month of March is college basketball."
That passion's also coming from a much younger base with more of that coveted expendable income that companies crave. The NFL, NBA and Major League Baseball all hit the 25- to 54-year-old demographic pretty solidly, but Glenn notes that college sports do a far better job of reaching a base of 18- to 34-year-olds that proves a far more passionate audience.
CBS(CBS) and Turner Sports took that into account when inking a $10 billion deal to broadcast the NCAA tournament through 2024. The $738 million in advertising revenue March Madness brought in last year ranked No. 2 among postseason sports properties, just behind the $900 million in ad revenue produced by the NFL postseason last year but well ahead of the roughly $450 million apiece in revenue produced by the Major League Baseball and NBA playoffs.
Part of the reason for that huge haul is the $1.2 million the networks charged 78 advertisers per 30-second spot in last year's NCAA championship game, which is less than the $3.1 million average for Super Bowl spots but more than the cost of commercials for college football's BCS title game ($750,000), the NBA Championship ($435,000) and baseball's World Series ($421,000). Perhaps the biggest revenue builder, though, is the more than two weeks of bracketed games between 68 teams that gives advertisers a long stretch of face time with their potential buyer base.
"Time gives you a chance to build up equity and really create an impression in the minds of consumers," Glenn says. "The multiple weeks of March Madness certainly help and can create a more powerful platform than a one-off event ... not to diminish a one-off event of Super Bowl magnitude."
Sponsors aren't above shelling out for huge chunks of that time, either. NCAA "Corporate Champions" AT&T(T) , Coca-Cola(KO) and CapitalOne(COF) are already paying to have their names plastered all over the event, but offer millions more to make sure they have a big impact during commercial breaks. AT&T alone bought $36.8 million worth of airtime last year. Coca-Cola laid out $26 million, while CapitalOne contributed another $23.5 million. They weren't even close to the biggest spender, GM(GM) , whose Buick brand is one of the NCAA's corporate partners and whose $57.9 million in ad spending last year was just $5 million below what the entire telecom industry spent on the event during the same stretch. Even Anheuser-Busch InBev (BUD) and SABMiller kicked in more than $20 million apiece last year, and the NCAA is actively limiting their involvement in the Final Four.