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Nothing But Net: March Madness a Winning Investment

College hoops the right stuff for auto brands

James Southerland #43 of the Syracuse Orange reaches for a rebound against Will Spradling #55 of the Kansas State Wildcats Photo by Gregory Shamus/Getty Images

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Advertisers are putting up big dollars to grab a piece of March Madness, and while the cover charge may be steep, it appears that the spring hoops showcase is well worth the price of entry.   

Marketers will pony up nearly $1.5 million dollars for a spot in the final game of the NCAA Men’s Division I Basketball Championship—money that’s well spent, according to the media measurement software and analytics company TRA, Inc.

Automakers are a particularly good fit for March Madness, said Mark Lieberman, co-founder and CEO of TRA. For example, Infiniti owners were found to be twice as likely to watch the tourney than viewers who drove other brands. Acura viewers also overindexed in the tournament, by a two-to-one ratio.

TRA pulls its viewing and purchasing data from a database of 370,000 households. Forty-five major brands make allocation decisions based on the TRA data.  

That car manufacturers are well suited to March Madness happily coincides with the buying power of the category. Per Kantar Media estimates, automotive accounted for $155.9 million of last year’s NCAA tourney spend, or 21 percent of the $738 million in ad revenue shared by CBS and Turner Sports.

“From a purchase-intent standpoint, CBS and Turner are delivering the right audience for March Madness,” Lieberman said. “The data very much justifies the investment by the automakers.”

After cutting back its spend in 2010, General Motors returned to the tournament with a vengeance, topping all sponsors with a $57.9 million investment, or about $10 million more than the previous year. An official NCAA corporate partner, GM is once again showcasing its Buick marque with :30s and a presenting sponsorship of the Inside March Madness postgame show.

Per TRA data, Buick truck owners are more likely to watch March Madness than any other auto consumer. Ownership is defined by a relevant brand purchase made between 2008 and 2012.

Along with GM, nearly every major auto manufacturer is being represented in the 2012 tourney, a roster that includes Chrysler, Ford, Honda, Infinity, Mazda, Mercedes and Volkswagen.

NCAA corporate sponsors are also showing up in force. In March, Allstate signed a multiyear pact with collegiate sports’ governing body, following on the heels of a similar deal made by Northwestern Mutual. The insurance companies join legacy NCAA partners like Buick, Enterprise Rent-A-Car, Infinity, Kraft and Unilever, as well as the so-called “Corporate Championship” sponsors: AT&T, Capital One and Coca-Cola.

Statistically, the indices for CBS and the Turner networks are very similar. “Last year we found that even though the games air in very different environments, the consumer profiles are amazingly consistent,” Lieberman said. If nothing else, this suggests that the CBS-Turner cross-channel promotional push did everything it was supposed to in the first year of the 14-year, $10.8 billion rights-sharing pact.

“March Madness is…successfully uniting traditional and digital media platforms to create more value for the audience and the marketers who seek to reach them,” said Jon Swallen, svp of research at Kantar Media Intelligence North America. “The tournament demonstrates how multiple screens can be complementary, rather than cannibalistic.”

While the average cost any individual advertiser pays is directly proportional to how far into the tournament their package extends, the cost of a 30-second spot predictably increases as the field of 64 gets whittled down to the Final Four. When the regional semifinals tip off Thursday night on CBS, clients can expect to pay as much as $350,000 for a single spot, up from roughly $100,000 in the opening rounds.

A 30-second spot in the national semifinals will fetch as much as $700,000, while the average unit cost for the national championship game is up to $1.45 million. The price of a spot in the title tilt marks a 16 percent increase from last year’s final.

Thus far, advertisers have much to be thankful for, as the ratings are the highest they’ve been in 18 years. Through Saturday night, CBS, TNT, TBS and truTV are collectively averaging 8 million viewers with their March Madness coverage, an improvement of 3 percent versus the year-ago 7.8 million.

With powerhouse No. 1 seeds Syracuse, Kentucky, North Carolina and Michigan State having safely reached the Sweet Sixteen, ratings should continue to shine.

The national semifinals tip off in Boston on Thursday, March 22, as Syracuse takes on No. 4 seed Wisconsin (CBS, 7:15 p.m. EDT). In another matchup of a No. 1 and No. 4 seed, Tom Izzo’s Michigan State Spartans take on Rick Pitino and the Louisville Cardinals in Phoenix (TBS, 7:47 p.m. EDT).