The economics of the Super Bowl
The economics of the Super Bowl
American capitalism’s holiest ritual
Related: The NFL's Journey: From Steel Mills to Global Brand
Key takeaways
· The Super Bowl generates massive economic impact both locally and through media advertising
· Super Bowl ads have historically reflected the American culture and economy, showcasing technological trends and societal moments
· The addition of Taylor Swift to this economic cornucopia presents unprecedented commercial potential
There is nothing more American than the Super Bowl. With gladiatorial combat featured both on and off the field in the arena of consumer brand opinion, the Super Bowl generates economic activity on the order of a small country. Some of this activity comes physically in its host city but most comes from media advertising revenue. In 2023, 113 million people watched the Super Bowl and this year, a 30-second ad went for $7 million[i].
Through the years, ads reflect the American economy of the moment. During Super Bowl I, a 1967 matchup of the KC Chiefs and Green Bay Packers, the astronaut’s orange juice replacement, Tang, represented the country’s immersion in the Space Race, then in full swing:
During 1984’s matchup of the Washington Redskins and Los Angeles Raiders, Apple unveiled the Macintosh personal computer in the Ridley Scott-directed “1984” spot:
Super Bowl XXXIV (played in January 2000 between the St. Louis Rams and Tennessee Titans) featured 14 advertisements from 14 different dotcom companies, each of which paid an average of $2.2 million per spot. Pets.com, which was liquidated in the 2000 dotcom crash, aired this spot:
During Super Bowl LVI in 2022 between the LA Rams and Bengals, an America in the midst of a crypto bubble was treated to a bouncing QR code from crypto broker Coinbase:
If the past is a guide, this year we’ll be inundated with AI and tech-related commercials, foreshadowing either a market crash (dotcom bubble) or transformative technological breakthrough (Macintosh).
The Super Bowl is big business and this post will discuss the economic impact on the host city, the economics of Super Bowl ads, and this year’s x-factor: Taylor Swift.
The host city
The city that hosts the Super Bowl, this year Las Vegas, will be descended upon by hundreds of thousands of fans who will each spend hundreds of dollars on restaurants, hotels, and attending the game. The 2016 Super Bowl in Phoenix generated an estimated $719 million for the state of Arizona[ii]. This year, the state of Nevada hopes for well over $1 billion in economic activity, thanks to Las Vegas’s unique spending “opportunities” and inflation.
Television
Unlike the physical capacity of the hosting stadium, the TV market for the Super Bowl is only constrained by the population of the Earth. 51 million viewers tuned into Super Bowl I in 1967[iii]. In 2023, 113 million viewers tuned in to watch the Chiefs win a World Championship[iv].
That’s a lot of eyeballs for advertisers to reach, a fact reflected by the cost of a 30-second ad ($7 million in 2024). If technological trends hold, we’ll have the first streaming only Super Bowl sometime in the near-future. And like the Peacock-only streaming Wild Card playoff game this year demonstrated, it will be big business for some streaming platform and irritate America. The ads will make the leap to the new technological paradigm.
Taylor Swift
In case you’ve been living under a rock, superstar Taylor Swift is dating KC tight end Travis Kelce. Super Bowl LVIII will feature the merger of American capitalism’s jamboree with global pop culture phenomenon Taylor Swift. No one knows what will happen but the commercial potential is unprecedented. Ms. Swift will be arriving from a February 10 Tokyo concert in her “Eras” tour to the February 11 kickoff of the Super Bowl in Las Vegas thanks to the twin miracles of private air travel and the international date line. The “Eras” tour is expected to generate $10 billion in revenue on its US leg alone[v]. If the “Eras” tour was a country, it would be bigger than 50 others.
Ms. Swift also has a massive fan base, with 53% of US adults[vi] identifying as “Swifties”, and 534 million global social media followers[vii]. Many of these fans may not be typical football fans but will tune into the game anyway to see their pop star heroine. That additional audience draw makes the commercial potential of a Swift-Kelce romance and a Chiefs football dynasty unprecedented in the history of American capitalism.
Super Bowl C
If the Super Bowl continues to be held annually, Super Bowl C, or Super Bowl 100 for those not inclined to roman numerals, will be held in 2066. It is unclear whether we will stream, watch with VR glasses, or view a hologram representation of the game. What is certain is that there will be lots of commercials.
Ms. Swift will be 77 in 2066.
[i] https://www.reuters.com/sports/nfl/what-expect-this-years-super-bowl-ads-2024-02-09/
[ii] https://www.cnbc.com/2016/01/29/super-bowl-benefits-host-city-but-by-how-much.html
[iii] https://www.perplexity.ai/search/What-was-Super-QU5F_ImaTNaypRlLTjsMmQ#414e45fc-899a-4cd6-b2a5-194b4e3b0c99
[iv] https://www.perplexity.ai/search/What-was-Super-QU5F_ImaTNaypRlLTjsMmQ#414e45fc-899a-4cd6-b2a5-194b4e3b0c99
[v] https://www.newsweek.com/super-swift-economic-impact-taylor-swifts-eras-tour-1858678
[vi] https://pro.morningconsult.com/instant-intel/taylor-swift-fandom-demographic
[vii] https://explodingtopics.com/blog/social-media-following#most