This year’s Super Bowl broke records both within audience levels and ad pricing. On average 111 million viewers watched the 2011 Super Bowl, besting the previous year’s then record audience of 106.5 million. This year’s audience growth of 4.2% is above the average 2.8% growth that event has seen since 1968 but is lower than the price increases on advertising.

For this year’s Super Bowl Fox sold 30-second spots at estimated prices between $2.8 million and $3 million, around 7% more than what CBS charged last year. Given the average reach of 111 million viewers or 53 thousand households, the effective CPM (eCPM) of the broadcast was round around $27 for viewers and $54 for households. This is actually close to the levels seen in 2001 but over double what they were in 1991.

The eCPM growth is even more noticeable when compared to the average paid for broadcast network primetime. Basically the difference between the two can be considered to be a premium paid for spot placements within Super Bowl. Just as one thousand impressions are worth (or priced) more on The New York Times rather than a lesser paper, the opportunity to air a spot on the Super Bowl has a unique value and an extra cost.

Besides simple brand status the essential reason for this “Super Premium” is that television viewing, while increasing overall during the last 20 years, has greatly fragmented so now there is less supply, and inherently greater demand, for any event that can consistently reach a large portion of the marketplace. No other singular live broadcast has the same draw as the Super Bowl. Besides status and reach, a third factor is engagements- the audience during the Super Bowl pays rapt attention during commercials breaks, further increasing the potential value of these message slots. Given these reasons it is easy to understand why the eCPM of the Super Bowl is double the average for broadcast primetime.

Of course it would only make sense to buy one of these placements if you’re certain about the message you’ll be sending, which opens up another debate about the “best” Super Bowl commercials. Ad Age has two interesting top 10 lists for the spots that were enjoyed or recalled the most. It is interesting to note that the three spots with the highest likeability (VW Darth Vader Passat, Bridgestone  Beaver, E-Trade Baby Sneezing Cat) are not on the list for best recall.

Is it more important to be liked rather than remembered? Most sensible marketers would probably prefer the latter, but a likability, or an emotional connection, can be a strong force for larger ticket items or premium brands. I also think that the VW Darth Vader spot received a lot of attention post the Super Bowl, and it has been shared and viewed online a lot more since then so perhaps its recall levels and brand reinforcement to VW are now higher. Another perspective is that the top recalled spots (Doritos Pug, Budweiser Cowboy, Doritos Office Licking) have been criticized for using cheap puns which don’t build lasting connections with audiences, but perhaps this is what you need when you’re selling low-priced items like chips and beer to less mature customers. I think there is a reason that Budweiser has bought the first commercial spot placement in the Super Bowl for years, and repeated a very similar messaging style. Both the Budweiser and VW messaging style have their place, and should simply be subjectively applied depending on the marketing strategy.

During my last posting I took a look at the audience levels for the Academy Awards since 1974. Since I had the data handy I decided to compare the viewing trends to the Superbowl.

It’s fascinating to see how the audience levels have diverged. Although slightly more popular in 1974, the Superbowl now attracts more than double the audience of the Oscars. Perhaps this is a reflection of the diminishing value of the Oscars, now that there are more opportunities now to see celebrities and movie stars, be it through other awards telecasts, multiple magazines, specialty cable channels and hundreds of web sites.

I was also interested in comparing the relative ad pricing between the two events, especially since it was recently reported in Mediapost that there has been some discounting and special packages offered for advertising in this year’s Oscars. Comparing the ad prices between the two events since 1983, the CPM per household was relatively similar until the last three years.

Last year a 30-second national spot in the Oscars cost $1.8 million and had an effective CPM of approximately $86. This year the prices for a national spot have dropped to $1.4 million. If the broadcast maintains the same ratings, it will have an effective CPM of $66, 23% lower than last year but still higher than the mid 50′s CPM for the Superbowl. Perhaps certain clients will opt to pay more for certain female or upper-income segments that more commonly tune into the Oscars rather than the Superbowl.

UPDATE: The Oscars averaged 36.3 million viewers, well above my predicition and much higher than the audience of 32 million last year. More on this later.

Super Bowl XLIII is less than five days away and I am looking forward more to the commercials than the game itself . A Super Bowl commercial has be better than the game since it has only 30 seconds to grab a viewer’s attention and be as memorable as any play or touchdown that occurs between breaks. This year advertisers will be paying around $3 million for the privilege to air their messages. How did the price get this high and what is it really worth?

The Super Bowl is considered by advertisers be ‘super’ since it manages to draw the mass audience of yesteryear, and it’s still growing. Last year’s Super Bowl XLII between the New York Giants and the New England Patriots yielded a record audience of over 97 million television viewers.

While the Super Bowl audience size has grown, advertising prices have risen at a higher rate. Adjusted for inflation the cost of a 30 second spot has risen 795% between 1968 to 2008. The biggest single annual jump has been 42.5% (in 1985) but overall the greatest growth was seen during the late 90′s, probably an aftermath of the networks’ competitive bidding for the NFL broadcast rights that were then up for renewal. This began in 1993 when fledgling Fox snatched the broadcast rights from CBS with a $1.58 billion bid for four years. CBS then came back in 1998 offering $4 billion for the AFC games, while Fox paid $4.4 for the NFC, which then effectively shut NBC out of the NFL and ended that network’s 59 year broadcast history with the sport. Not until 2006 did NBC get back in the game, by gaining the rights to the Sunday night game, which has subsequently improved its Sunday night ratings. This bidding war demonstrates the power of not just the Superbowl, but of the entire NFL schedule.

But getting back to the Super Bowl, the reason that advertising prices are so high, and the reason that network vie to broadcast the event, is that it’s a unique platform to reach a concentrated audience simultaneously. It’s been shown that Superbowl viewers pay more attention to commercials aired during the event. According to this TNS study, viewers pay attention during the Superbowl at an index level of 100, while the average primetime show has a level of 90. Both advertisers and the networks understand these marketing benefits. Fox invested 44 minutes during last year’s Superbowl for network advertising, a new record. The event also affords a unique opportunity for advertisers to achieve a big splash in the marketplace. It is no wonder that between 20 and 25% of the Super Bowl’s advertisers each year are first-time clients, who probably want to break out of the clutter.

Advertisers will pay premiums for such benefits, which can clearly be seen by the higher CPM (Cost per Mille) for the Superbowl. CPM or Cost per Thousand is an advertising measure often used to measure the relative performance between two media vehicles. The following graph measure the cost of reaching 1,000 homes, either by advertising in the Superbowl or on network primetime television.

The network primetime CPM figures comes from the TV Bureau of Advertising website, and take into account all broadcast networks including the WB, UPN and Univision. Therefore, it might be a little low and not be as different as the Super Bowl CPM, which runs about twice as high. Given the benefits mentioned before, this CPM could therefore be comprehended. While it is difficult to judge whether the prices are worth it, the customers do seem the appreciate the opportunity and that says a lot.