Every year, millions of people tune into the Super Bowl not just to watch the biggest football game on Earth, but also to bear witness to the spectacle that is Super Bowl commercials.
???Commercials during the Super Bowl are well known to be over the top in both content and cost, with the price of advertising being upwards of $1 million per minute, but a recent study by a UB researcher shows that the price may well be worth it.
???According to Kenneth A. Kim, associate professor in the Department of Finance and Managerial Economics, the best ads increase the company's stock a day later.
???"The companies that aired the most liked commercials during the Super Bowl enjoyed a .62 percent stock price increase on Monday," Kim said.
???Reebok aired a well-received commercial in 2003 where fictional football linebacker Terry Tate tackled unproductive office employees.
???"Reebok stock rose by 2.2 percent after that aired, even though the entire market was down about 3 percent during that time period," Kim said.
???Budweiser is also well known for consistently airing popular ads during the big game, and their stock has made gains because of it.
???Despite the current economic downturn and poor outlook of the stock market, Kim expects commercials will retain their value this year.
???"I think that commercial likability is going to have a stronger effect this year," Kim said. "Right now there is so much uncertainty in the stock market and it's very hard for people to figure out which stocks to buy. When there is uncertainty people grab on to these irrational cues even more."
???Kim's conclusion is based on research done on 529 different commercials between 1989 and 2005. Kim identifies popular commercials based on USA Today's annual post-game poll.
???"USA Today hands out handheld devices to hundreds of households and are asked to rate commercials from least liked to most liked," Kim said. "They compile the data and publish these results after the Super Bowl."
???Kim then tracks the stock market value of the top rated companies for the days following the game.
???"[For] those commercials that everyone seems to like, the stock prices take a jump," Kim said.
???However, don't ask Kim to make a prediction about which stocks will increase.
???"Last year I watched the Super Bowl and made a prediction... every one of my predictions was wrong," Kim said.
???So what is it about a commercial that makes it popular? Why is Budweiser constantly taking more than one place on the top 10 list and why does Terry Tate rate among the best commercials of all time?
???"If I knew the answer to that question, I would be able to make money every year," Kim said.
Photo: Breadchastick / Wikimedia Commons
