Adjust Text Size
small medium big

The Economics of Super Bowl Ads

Written by Nickel - 5 Comments
  •  Tip It!

The other day I wrote up a short piece about the cost of Super Bowl ads — $83k/second, or roughly $2.5 million for a 30 second spot. This got me to thinking… How does a company like GoDaddy.com justify this sort of an expenditure? I saw at least two GoDaddy ads during the Super Bowl. Given that their main business is registering domain names for $8.95 apiece, I can’t figure out how this is a good move on their part. Yes, they’re building a brand. But… They’d have to sell close to 280,000 domain names over and above what they would have otherwise sold in order to generate an extra $2.5 million in revenues, and this doesn’t take into account their expenses (or the fact that they ran more than one ad). Granted, domain registration isn’t their only business. They also offer hosting and a bunch of different ‘upgrades’ when you register your domain name, but still… This seems like an awfully big expenditure for a business like GoDaddy. Then again, they’ve got people like me talking about them, so maybe the buzz that they created is worth it in the end.

Published on February 6th, 2006 - 5 Comments
Filed under: Miscellany

About the author: Nickel is the founder and editor-in-chief of this site. He's a thirty-something family man who has been writing about personal finance since 2005, and guess what? He's on Twitter!

Related articles...

» Super Bowl Ad Prices
» Super Bowl (and Stock Market) Prediction Poll Results
» Money Poll #23: Super Bowl Prediction
» From the Archives (January 27th – February 9th)
» One Year Ago This Week (February 4th – February 10th)
» Carnivals – Week of 02/13/06
» How Much Does a Million Dollars Weigh?
» Late Monday Roundup – XLII Aftermath Edition

Was this article useful? Please sign up to receive our content via e-mail:

You will receive only the daily updates, and can unsubscribe at anytime.

5 Responses to “The Economics of Super Bowl Ads”

  1. 1
    sean Says:

    I like to use GoDaddy for all my domains, but domains aren’t where they make their money I’m sure – it’s all the little addons they try to push every time you sign up.

    That said, it is pretty insane to pay an advertising cost of that level, but being a dotbomb survivor, they apparently must have some clue of what they’re doing! ;)

  2. 2
    jim Says:

    Domains are their loss leaders but I wonder how many people buy other services from them… I suppose it’s they make enough to pay for all this because they did have ads in last year’s Super Bowl as well.

  3. 3
    Guest Says:

    Well I wonder how yahoo stays in business. I’ve been using their free email system for years and I’ve yet to buy a single related yahoo item. I don’t have anything against yahoo I just usually get better deals elsewhere…

  4. 4
    Blaine Moore Says:

    Yahoo serves ads in your email, and the advertisers pay yahoo for your email service.

Leave a Reply

Top Cards by Category

 
Apply now for Chase Freedom® Visa - $200 Bonus Cash Back

Earn $200 Bonus Cash Back after you make $500 in purchases in your first 3 months. 5% Cash Back on up to $1,500 spent in bonus categories each quarter.

 
Apply now for http://www.fivecentnickel.com/rewardpoints.html

Earn 30,000 bonus miles toward Award Travel when you spend $500 on the Card in the first three months from account opening. Receive double miles on Delta purchases.

 
Apply now for American Express® Gold Card

Receive 10,000 Membership Rewards bonus points when you spend $1,000 in 3 months of Card membership.

 
Apply now for http://www.fivecentnickel.com/lowratebalancetransfercreditcards.html

Enjoy a 0% introductory rate for 18 months on Balance Transfers and 6 months on Purchases. Earn up to 5% cash back in categories that change.

 
Apply now for Discover® More Card - $0 Balance Transfer Fee!

Enjoy no balance transfer fee for a limited time. 0% introductory rate on Balance Transfers and Purchases. Earn up to 5% Cashback Bonus in categories that change like gas, restaurants, department stores and more. Limitations apply*

 
Apply now for http://www.fivecentnickel.com/lowrateplatinumcreditcards.html

Enjoy no balance transfer fee for a limited time. 0% introductory rate on Balance Transfers and Purchases. Earn up to 5% Cashback Bonus in categories that change like gas, restaurants, department stores and more. Limitations apply*

 
Apply now for The Business Platinum Card® from American Express OPEN

Enjoy amenities for you and your business, like: complimentary airport club access, including American Airlines Admirals Club(R) lounges.

 
Apply now for http://www.fivecentnickel.com/studentcreditcards.html

5% Cashback Bonus in categories that change like gas, restaurants, department stores and more. Limitations apply*. Up to 1% unlimited Cashback Bonus on everything else. No annual fee

 
Apply now for American Express Premier Rewards Gold Card

Earn 3X points on airfare, 2X points on gas and groceries, and 1X points on everything else.

 
Apply now for http://www.fivecentnickel.com/credit-cards/credit/bad

Reports to 3 major credit bureaus monthly and acceptance at millions of locations worldwide, including website purchases and reservations.

Previous
Pause
Next

FiveCentNickel User Survey