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Pepsi Sits Out The Super Bowl

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Pepsi and General Motors may be skipping the Super Bowl this year, but that doesn’t mean that CBS is hurting for advertisers. The network announced today that 95% of its ads are sold out for next month’s game.

While Pepsi’s decision may have led a VP at the soft drink company to declare that “brands should not blindly anchor themselves to history” last month, pre-sales for the game prove that as long as America’s most popular sporting event continues to reach over 90 million viewers a year, advertisers will keep biting.

For starters, Pepsi’s anti-Super Bowl rhetoric is worse than its bite. (Pepsi snack brand Doritos will still apear in ads this year). But Super Bowl ads are not for everyone. The steep price – between $2 and $3 million for a 30-second spot – prohibits many companies from buying in. And for many brands, the 30-second spot is not the best way to reach an audience and achieve marketing goals.

That’s Pepsi’s argument for sitting out this year’s festivities. The soft drink giant spent over $142 million to encourage consumers to drink the Pepsi brand between 1999 to 2009. But this year, Pepsi is launching a different kind of campaign, and looking to social media to get its message across.

Instead of spending $3 million per ad during the Super Bowl, Pepsi will be kicking off the “Pepsi Refresh Project” in the next few weeks.

“Under the program, Pepsi will award grant money for community projects proposed and selected by consumers, such as helping high-school students publish books to develop their writing skills. Pepsi says it has earmarked $20 million of its ad dollars for the grants next year.”

The company wants “deep consumer engagement” for the Pepsi Refresh Project, and Frank Cooper, senior vice president of PepsiCo Americas Beverages, tells the Journal, “It would be too hard to explain Pepsi’s new marketing campaign in a 30-second TV spot.”

For many advertisers, however, 30-second ads still work. Anheuser-Busch and Hyundai are participating this year. Meanwhile, Coke is happily picking up TV time during the game while Pepsi sits out. And competitor Dr. Pepper has jumped in to fill space now that Pepsi is passing on ads this year.

The Super Bowl has consistently attracted more than 90 million viewers in recent years. Last year’s game between the Pittsburgh Steelers and Arizona Cardinals wrangled a record 98.7 million viewers.

Purchasing an ad during the Super Bowl is still the best way to reach the largest audience of viewers at the same time. With word of mouth before and after the game, a big buy like the Super Bowl can do a lot to spread word for a brand. And many brands are hoping to leverage that.

Both Doritos (a Pepsi brand) and CareerBuilder are sponsoring user-generated ad contests to create their Super Bowl ads. According to USA Today:

“Doritos, which will air three consumer-created ads, is offering up to $5 million in cash prizes, including a $1 million bonus each if their ads win the top three slots in USA TODAY’S annual Super Bowl Ad Meter consumer rating of ads.”

But today, with consumers self-selecting different venues for viewing content, that’s not necessarily what brands are looking for. And the stickiness of social media means that brands can reach and interact with customers for much less money.

That’s Pepsi’s take at least. The company plans to spend the same amount of marketing dollars as last year, but is shifting its focus. Though the company still spends a large chunk of its budget on TV ads, Pepsi plans to spend 60% more on online ads in 2010 than it did in 2009.

Trying to impress audiences can be a constly venture. Pepsi’s decision comes a year after it heavily invested in 3D technology for the 2009 Super Bowl, while Coke took an eight year hiatus from Super Bowl ads that only ended in 2007.

But if the Super Bowl keeps delivering good audience numbers, it will continue to interest brands. Arnold Worldwide’s CEO of US operations

“As long as the Super Bowl can reach almost 100 million Americans, there will be 20 major companies who will want to play on that stage, and three or four little guys with big ambitions who will pay to take their shots,” he said.

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Sunday, August 20, 8:57 pm

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