"Is March Madness Marketing’s Next Super Bowl?"

From The Street

Review by James Hemphill in KIN 435 (section 2)

The gold standard for television advertising in sporting events has been the Super Bowl, but the NCAA Tournament has made over $5.2 billion in television advertising from 275 sponsors over the course of the past decade. The 2011 NCAA Tournament garnered $738 million with only 78 sponsors. The key ingredient for the NCAA Tournament to generate nearly three quarters of a billion dollars is passion. Collegiate fans are the most passionate of all sports fans and they are comprised of mostly individuals ranging from ages 18 to 34.

CBS and Turner Sports have capitalized on the growing opportunities to make a profit from the NCAA Tournament. They signed a deal to televise the tournament for $10 billion through the year 2024. Both CBS and Turner Sports realized that the tournament is the second most profitable sporting event behind the NFL Playoffs and continues to prosper. A thirty second television spot for the NCAA Tournament Final costs roughly $1.2 million. The key ingredient for advertisers is the fact that the NCAA Tournament last three weeks and gives them more face time with their potential consumers.

The three main sponsors of the NCAA Tournament are AT&T, Coca-Cola, and Capital One. They each spend millions of dollars to have their companies all over television commercials, but none of them pay as much as General Motors for advertising during the tournament. Backed by their corporate sponsor Buick, GM spends $57.9 million on advertising for the NCAA Tournament. In terms of public sentiment, the Final Four of the NCAA Tournament ranks second in major sporting events behind only the Major League Baseball World Series. This signifies the importance of the Final Four to not only people associated with the specific universities participating in the two national semifinal games but also collegiate basketball fans across the United States.

The downside of the NCAA Tournament is that the awareness and avidity of the event is only half of the Super Bowl. While the Super Bowl has the potential to reach 86.6 million individuals through marketing, the Final Four only has 43.8 million potential customers. However, this has helped smaller companies such as Buffalo Wild Wings, Southwest Airlines, State Farm Insurance, and UPS devise marketing campaigns to promote their products during NCAA Tournament games.

The marketing and sales implications of this article are that the NCAA Tournament is one of the largest sporting events in the United States and there are opportunities for many different types of sponsors to become involved during the tournament. Although it doesn’t reach as many customers as the Super Bowl, the NCAA Tournament allows for smaller companies to advertise their product or service to potential customers. It is likely that the NCAA Tournament will continue to grow because of its popularity and it should continue to rake in large sums of money from sponsors. With the NCAA Tournament concluding this past Monday, it will be intriguing to view how successful corporate sponsors and other sponsored companies were with generating sales.