SBJ/June 4-10, 2012/Research and Ratings

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  • Verizon tops among ad spenders

    Verizon Wireless replaced rival AT&T as sports’ biggest ad spender last year, and domestic auto manufacturers returned to the industry in a big way, according to data compiled annually for SportsBusiness Journal by Nielsen.

    Verizon spent $345.4 million for sports advertising on television in 2011, up slightly from 2010 and up $98 million from 2009. The company is an official sponsor of the NFL and NHL and was one of the top spenders during broadcasts of those leagues’ games specifically.


    AT&T’s wireless division, the 2010 spending leader, spent $296.9 million in 2011, according to the data, 19 percent less than what was spent in 2010. The $10.3 million the brand spent during college football bowl games last season was the most of any advertiser, and in NASCAR, AT&T was second only to Sprint among advertisers for that sport’s top circuit. AT&T corporate spent an additional $55.3 million promoting the overall entity rather than highlighting a specific company product, such as the wireless group, known officially as AT&T Mobility.

    This marks the first time in the 18 years that Nielsen has been tracking the spending data that Anheuser-Busch has been out of the No. 1 spot in consecutive years and only the third time ever. Spending during the 2010 Winter Olympics and FIFA World Cup pushed AT&T to No. 1 for that year; in 2006, Chevrolet’s significant Olympic ad buy bumped it to the top spot, also ahead of the brewer.

    “The wireless sector continues to be just gangbusters,” said Stephen Master, vice president of sports at Nielsen. “It’s kind of surprising because there are only a few big players so you’d think they’d slow down.”

    The top 50 advertisers spent a combined $5.68 billion in 2011, down 8.5 percent from what the top 50 companies spent in 2010, but 19 percent more than in 2009.

    Overall, 14 of the 15 biggest spenders in 2011 were the same companies and brands as in 2010, though there was movement in the rankings among those entities. The only newcomer to the top 15 was State Farm at No. 14 (No. 16 for 2010), replacing Coca-Cola, which fell from No. 13 for 2010 to No. 24 for 2011.

    The spending information is based on standard rate-card prices for specific national and regional live and taped sports broadcasts on English and Spanish networks. The staging of the Olympics and FIFA World Cup can skew year-to-year comparisons for companies, making two-year comparisons notable in some cases. For example, in 2010, U.S. Olympic Committee and FIFA sponsor Coca-Cola increased its ad spending by 78 percent over 2009, a non-Olympic year, but its spending fell back again last year, by 40 percent. The $86.6 million the company spent last year was still 6 percent higher than its 2009 spending.

    “If you look at the way media is consumed today, sports programming is the only must-see TV that’s left, because if you miss it when it’s live, you’re out of the conversation,” said Michael Neuman, managing partner of Horizon Media’s Scout Sports and Entertainment division. “And that’s why those numbers [for all companies] will continue to grow.”

    Horizon Media, one of the world’s largest media-buying and planning agencies, counts top 50 advertisers Capital One and Geico among its sports clients.

    The most visible shift in the industry’s advertising landscape may have been imported from Detroit. Auto manufacturers kicked off 2011 by spending a record $77.5 million on 18 Super Bowl spots pitching nine different brands, according to Kantar Media, an increase of 160 percent in spending compared with 2010’s game.

    A record 18 auto brands made the top 50 spenders list in 2011. Several foreign automakers, including Acura and Audi, made the top 50 for the first time last year (for their 2010 spending), and that sparked an overall spending increase by auto industry. While those foreign brands remained on the latest list, the sector’s growth in 2011 was fueled primarily by the brands of General Motors and Chrysler, which combined for more than half a billion dollars in spending over the course of the year.

    Neuman said that after a tumultuous period of downsizing, bailouts and restructuring, domestic automakers almost had to make a huge return to sports, both for public relations and for marketing purposes.

    “Sports fans need to know that Detroit is strong, and the way they are going to see that best is through a constant dose of strong advertising,” he said, “because if a couple buying cycles go by and consumers don’t see those ads, they won’t feel comfortable making an investment in a Detroit-based company. They are going to spend elsewhere, and the long-term ramifications for the domestic automakers is going to be significantly hurt.”

    Chrysler Group, whose portfolio includes its namesake brand along with the Dodge, Jeep and Ram labels, had $280.5 million in spending. Spending for the Dodge brand declined 29 percent compared with 2009, but the combined spending for the other lines saw a nearly threefold increase during the same time period. The company’s Super Bowl ad featuring Detroit-native Eminem depicted the city of Detroit in docu-drama style as a blue-collar town capable of producing a luxury car.

    Chrysler was not ranked among the top 100 advertisers for 2010 or 2009 but surged to No. 18 for 2011. Chrysler averaged $44.3 million in annual sports ad spending from 2002 through 2006, mostly during PGA Tour broadcasts. The brand, as well as sister brand Jeep, were frequent spenders during MLB postseason and college football telecasts last year.

    Similarly, Ram had never ranked in the top 100 but was No. 47 for 2011 spending, partly becaue of its partnership with Churchill Downs and Kentucky Derby broadcasts.

    GM brands Chevrolet, Buick, Cadillac and GMC Trucks combined for $446 million in spending, up 5 percent over 2010 and up 37 percent over 2009. Chevrolet sponsored MLB pregame and postgame shows on Fox throughout the season. Buick went from being ranked No. 97 for 2010 spending to No. 38 for 2011.

    The sports advertising market continues to be robust. Advertisers spent more than $3 billion on televised sports during the first three months of 2012, up 9 percent over the same time last year, according to Nielsen.

    Among other findings:
    No. 29 Pfizer was ranked No. 12 for 2009 ($129.4 million), and continues to be a top NFL and PGA Tour advertiser, but saw its spending drop 36 percent since that time.

    IBM, a top 10 advertiser annually for 2001 through 2004 and a top 50 spender through 2009, spent $47.1 million in 2011, down 55 percent from its peak in 2004.

    JPMorgan Chase rose from No. 76 in spending for 2010 to No. 34 for 2011. The financial services company has been among the top 100 sports advertisers for four straight years, tripling its spending during that span.

    McDonald’s committed 12.8 percent of its ad budget to sports, the lowest portion for the company in the 10 years Nielsen has provided such data to SportsBusiness Journal. In fact, the five quick-service restaurants on this year’s list — McDonald’s (No. 13), Subway (19), Taco Bell (28), Burger King (45) and Pizza Hut (46) — each saw a drop in rank compared with the previous year and collectively spent $176.5 million less in 2011 than in 2010.

    Southwest Airlines committed 68.7 percent of its overall company’s ad budget to sports, the highest among the Top 50 brands that are not affiliated with a sport property.

    Looking ahead to 2012 spending trends, GM announced in May that it will not advertise in next year’s Super Bowl, saying the ad time for the game has become too expensive.

    Top 50 sports advertisers

    (ranked by total sports ad spending in 2011)

    2011 RANK (2010 RANK) COMPANY/BRAND 2011 SPORTS AD SPENDING 2011 TOTAL AD SPENDING % OF AD SPENDING DEVOTED TO SPORTS CHANGE IN SPORTS SPENDING VS. 2010 CHANGE IN SPORTS SPENDING VS. 2009
    1 (3) Verizon $345,438,719 $1,523,982,375 22.7% +1.4% +40.1%
    2 (2) Anheuser-Busch $299,721,969 $456,239,625 65.7% -15.9% -3.8%
    3 (1) AT&T Mobility $296,940,250 $1,310,781,500 22.7% -18.9% +64.4%
    4 (4) Ford $263,507,645 $1,371,668,594 19.2% -13.6% +6.0%
    5 (6) Chevrolet $249,866,151 $1,029,529,844 24.3% +4.6% +49.9%
    6 (5) Toyota $218,603,617 $1,067,944,875 20.5% -8.9% +7.5%
    7 (8) MillerCoors $203,025,062 $360,294,438 56.3% -5.3% -10.4%
    8 (10) Sprint $171,090,500 $558,439,000 30.6% -4.5% -14.6%
    9 (15) Southwest Airlines $165,499,688 $240,861,062 68.7% +26.0% +28.6%
    10 (7) Geico Direct $163,494,641 $766,306,750 21.3% -24.6% -4.1%
    11 (12) Nissan $153,167,485 $577,850,691 26.5% -4.9% +96.9%
    12 (11) DirecTV $137,980,781 $356,739,531 38.7% -21.3% -18.1%
    13 (9) McDonald’s $127,131,258 $996,054,375 12.8% -37.3% -18.4%
    14 (16) State Farm $125,383,266 $523,524,906 23.9% -3.1% +7.7%
    15 (14) Warner Bros. Ent. $123,810,031 $652,460,688 19.0% -10.7% +11.9%
    16 (19) Lexus $120,587,471 $323,716,125 37.3% -3.5% NA
    17 (25) Mercedes-Benz $101,405,853 $287,888,226 35.2% -6.9% +56.1%
    18 (NR) Chrysler $96,888,814 $405,599,655 23.9% NA NA
    19 (18) Subway $96,174,164 $513,575,031 18.7% -23.3% -2.8%
    20 (23) Apple $95,068,961 $338,849,031 28.1% -14.0% +0.6%
    21 (29) Honda $94,147,979 $630,150,868 14.9% -5.8% +30.4%
    22 (41) Volkswagen $93,320,194 $387,565,754 24.1% +29.5% +81.9%
    23 (28) Hyundai $88,229,366 $517,189,031 17.1% -12.5% +3.3%
    24 (13) Coca-Cola $86,550,656 $239,212,750 36.2% -40.2% +6.4%
    25 (38) Capital One Bank $85,617,227 $339,769,281 25.2% +9.7% +92.1%
    26 (46) Audi $85,517,109 $252,945,844 33.8% +33.0% +131.1%
    27 (34) T-Mobile $84,826,672 $454,587,062 18.7% -2.3% +53.0%
    28 (20) Taco Bell $84,553,133 $253,149,594 33.4% -29.3% -25.5%
    29 (30) Pfizer $83,297,672 $628,068,438 13.3% -14.2% -35.7%
    30 (37) Universal Pictures $73,726,648 $406,595,625 18.1% -8.1% +18.6%
    31 (32) Lowe’s $73,050,992 $347,208,656 21.0% -19.1% -28.9%
    32 (36) Allstate $71,715,031 $398,728,812 18.0% -14.7% +61.5%
    33 (17) NFL $70,758,070 $90,372,641 78.3% -43.7% -9.5%
    34 (76) JPMorgan Chase $70,541,906 $534,394,750 13.2% +62.8% +87.9%
    35 (67) Cadillac $67,500,812 $269,792,774 25.0% +41.1% +25.5%
    36 (21) Microsoft $67,184,438 $352,056,812 19.1% -43.5% -27.9%
    37 (50) Paramount Pictures $64,470,188 $500,229,594 12.9% +13.0% +124.8%
    38 (97) Buick $64,464,672 $214,317,129 30.1% +104.6% +306.9%
    39 (27) GMC Trucks $63,860,890 $193,170,317 33.1% -39.7% -28.9%
    40 (61) Jeep $63,280,872 $328,192,018 19.3% +25.8% +125.2%
    41 (40) Home Depot $63,227,402 $434,258,188 14.6% -14.8% -7.2%
    42 (24) Dodge $61,824,470 $339,502,712 18.2% -43.3% -29.3%
    43 (72) Best Buy $60,000,355 $280,021,406 21.4% +31.8% +78.8%
    44 (47) Unilever $59,547,223 $322,485,812 18.5% -6.4% +21.9%
    45 (35) Burger King $58,906,398 $272,637,781 21.6% -31.5% -21.6%
    46 (42) Pizza Hut $58,641,305 $233,514,531 25.1% -13.7% +42.6%
    47 (NR) Ram $58,501,131 $269,079,493 21.7% NA NA
    48 (44) E*Trade Securities $57,757,773 $128,684,812 44.9% -14.6% +47.4%
    49 (45) Acura $56,203,571 $209,607,530 26.8% -14.9% +12.1%
    50 (48) AT&T Inc. $55,336,977 $437,700,125 12.6% -12.4% +4.6%

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