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Do Buzzy Super Bowl Ads Boost Related Stocks?

Published 02/07/2016, 02:20 AM
Updated 09/02/2020, 02:05 AM

by Clement Thibault

The Super Bowl. It's not just the annual American football season finale, it's also a massive television event, producing viewership records which are broken year after year after year. An added bonus: for savvy stock-pickers able to pinpoint the ads that will go on to become the most acclaimed after each broadcast, it might also be an early indicator of what equities will see a 5-20% boost in share price over immediate and upcoming quarters.

Super Bowl XLVIII, which saw the Seattle Seahawks anointed 2013 champions when it aired on Sunday February 2, 2014, totaled 112.2 million viewers, a record at that time; The following year, Super Bowl XLIX, which aired on February 1, 2015, saw the New England Patriots crowned 2014 champions. That broadcast broke the previous season’s record, with 114.4 million viewers tuning in over the course of the game, ending with 120.8 million viewers during the final, decisive minutes.

But championships and record audiences are only a small part of the story. The Super Bowl is also a money-making machine for participating franchises, networks and advertisers because of the vast number of viewers. In fact, advertisers—who pay premium rates for just a few seconds of air time—often see dramatic upticks in sales immediately after the game. Which guarantees that the cost of a 30-second ad is heart-stoppingly high.

Last year, the going rate was $4.5 million for half a minute. This year it is projected to average $5 million. The total revenue the network garnered from the full roster of ads in 2015 was a staggering $350 million.

Since the Super Bowl first aired in 1967, the commercials have become as much a part of the spectacle as the game itself. According to a poll by Monthly Consumer Survey, 25.1% of viewers report that for them, commercials are the most important part of the broadcast. 77.1% of viewers consider them part of the entertainment proposition, and only 4.5% report being bothered by the commercials.

With the advent of the internet, the best commercial spots have a massively extended shelf-life. According to Mashable, over 1600 years of Super Bowl ads have been streamed on YouTube in 2015 alone.

We've tracked back over the past 5 years’ worth of Super Bowl games, looking at companies that arguably had the best and most hyped commercials during Super Bowls 2011-2015. We also charted their stock’s performance in the quarter or quarters following the game in which their commercial aired.

Here’s what we found:

2015 – Budweiser (Anheuser-Busch)

Budweiser’s "Lost Dog" (parent stock Anheuser-Busch Inbev SA (N:BUD)) was without a doubt the most talked about commercial of 2015’s game. Of course, featuring a puppy in the starring role is a pretty surefire way to create buzz, and Budweiser hit the nail squarely in the head with the touching commercial that left viewers in tears and wanting more.

The commercial was posted on YouTube and to-date has over 30 million views. On Friday January 30, 2015, the market close prior to that Super Bowl, Anheuser Busch traded for $122.07 a share. Within a month, on February 26th, the stock peaked at $128.35, an increase of 5.1% in value.

ABI Daily, February 2015

That’s a 5% boost in just a month thanks to a cute Lab puppy.

Watch the commercial:

2014 – Axe Deodorant (Unilever)

Axe deodorant (Unilever NV (N:UN)) was a polarizing product from its inception. The demographic target, 15-24 year old males, were regularly fed an advertising ‘diet’ of girls in bikinis inexorably attracted to guys holding cans of Axe deodorant. As a viewer you either loved the spots or detested them. Then Superbowl XLVIII happened, and consumers got to see a side of Axe they’d never dreamed of.

Axe’s agency gambled that moving away from the product’s core campaign, and toward a surprisingly peaceable direction, might work in their favor. Indeed, the surprising, even lovely result had a great message that offended absolutely no one: Make Love, Not War. It showed a mature, responsible, and deeply serious side to the product that resonated with consumers.

After the game investors delivered, and over the following months showered Unilever's stock with love. Shares were priced at $37.34 for Unilever NV and $38.61 for Unilever PLC (N:UL) before the Super Bowl aired on February 2nd, 2014.

UN Daily, February-May 2014

Through April 30th of that year, both stocks rose steadily, with NV peaking at $42.95 and PLC at $44.83 (PLC), for respective gains of 15% and 16.1%.

Watch the commercial:

2013 – Tide Detergent (Procter & Gamble)

Laundry detergent is an undeniably mundane, even boring consumer staple. But Tide’s 2013 Super Bowl commercial contained all the elements needed to tweak every sports fan’s—and every housewife’s—respective dreams. It focused on the the miraculous, ‘Joe Montana salsa stain’, a clever use of the legendary San Francisco quarterback’s image during a season when the 49ers played against the Baltimore Ravens in the Super Bowl. The ad included an array of winning elements: religious iconography, over-the-top fantasy, charm, humor and a hat tip to both championship teams.

In addition it was surprisingly and cleverly well focused on the product. Tide’s parent company, Procter & Gamble (N:PG), enjoyed a popularity boost following the ad’s air date. Its stock, priced at $75.92 per share as of Super Bowl Sunday February 3rd 2013, reached a then all-time high of $82.54 on April 23rd, an increase of 8.7% from the day the ad aired.

PG Daily, February-April 2013

Appealing to sports fans, their households, and anyone who launders their clothes—that’s targeted advertising at its best.

Watch the commercial:

2012 – Acura NSX, Honda CRV

During the 2012 Super Bowl, Honda Motor Company Ltd (N:HMC) actually purchased two spots. The first was for Acura, Honda's premium brand, and featured Jerry Seinfeld and Jay Leno duking it out to be the first customer to get their hands on the soon-to-be introduced Acura NSX. The ad even featured the Soup Nazi, a character popularized by Seinfeld’s classic TV show, and a great wink to Seinfeld fans.

The second commercial, for the Honda CRV, featured Matthew Broderick, reprising his starring role in, along with the plot of, the 1986 movie Ferris Bueller's Day Off. Understandably, not every viewer got the references. But if you hadn’t been old enough to see the movie in ‘86, you probably weren't looking to buy a new SUV anyway.

Honda's shareholders benefited from the good publicity for both of its brands. In the 6 weeks following the Super Bowl, the stock jumped from $35.60 on February 5th when the Super Bowl aired to $39.35 on March 16th, an incredible 10% in a short amount of time.

Honda Daily, February-March 2012

Nostalgic references in clever packages got investors and consumers alike high on Honda.

Watch the commercials:

2011 – Volkswagen Passat

No article mentioning Super Bowl commercials is complete without a reference to Volkswagen's (OTC:VLKAY) "The Force", which aired during the 2011 Super Bowl. The ad features a pint-sized Darth Vader having trouble summoning The Force. That is, of course, until his dad gets home from work in his new Passat and gently, but remotely, takes matters into his own hands.

The commercial was a huge hit, and since airing has been seen all over the world. It’s still one of the most memorable Super Bowl commercials in recent memory.

The mega-hype around that commercial served the DAX-listed shares of Volkswagen (DE:VOWG_p), which trade in Frankfurt, very well: the company saw an increase of 11% for its share price, from €110.25 right before the Super Bowl which aired on February 6, 2011, all the way to €122.38 on May 2nd of that year.

Volskwagen Daily, February-May 2011

The US listed shares, traded as an OTC ADR, rose from $29.95 on February 6 to $36 on May 3, an increase of 20.8%. A fitting reward for a highly memorable commercial.

Watch the commercial:

Clearly, good companies with good Super Bowl commercials can see a gratifying boost to their stock after the Lombardi Trophy is handed out to the winning team. When done properly, that $5 million or so spent on a few fleeting seconds of air time doesn't seem so costly after all.

This year’s contenders for best Super Bowl commercial include Nestle's (OTC:NSRGY) ad for Butterfinger. The company has been hyping the commercial, and the product, with the #BolderThanBold hashtag. The ad features former New England Patriots wide receiver Terrell Owens and comedian Billy Eichner. The company released a teaser, hoping to garner pre-game interest.

Also in the mix is Korean electronics manufacturer LG (KS:066570). Their commercial stars actor Liam Neeson and was directed by Ridley Scott, whose sci-fi film Alien was a global success. The ad, titled ‘The Man From The Future’ promises "it will change everything".

Also expected is an election themed commercial from Bud Light, starring comedians Amy Schumer and Seth Rogan. A teaser was recently released. So far, additional details are scarce, but with Rogan's and Schumer's reputations (and popularity) we assume it will generate some post-game buzz (and YouTube replays).

Super Bowl 50 airs on Sunday February 7. Enjoy the game and the commercials, but remember to think of your portfolio as well. Which commercials—and their stocks—will you be keeping an eye on?

Latest comments

THX for the great info Clement, it was a real pleasure to read your article. I would like to ask you one small question based on your work here. Above you are saying that Honda's shareholders benefited from the good publicity for both of its brands. But is it was the only reason, which makes such a huge result? I mean, isn't this a little to much that in the 6 weeks following Super Bowl the stock jumped from $35.60 on February 5th when the Super Bowl aired to $39.35 on March 16th, an incredible 10% in a short amount of time. Thank you for answer!
As we know, short term market movements can be triggered by many events but also by technical trading unrelated to fundamentals. The jump in value after airing the commercial is at the very least an intriguing reoccurring coincidence, which leads us to believe it isn't one. We are aware that proving causality is borderline impossible in this case, the judgement is therefore left to the reader.
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