Report: ViacomCBS charging $5.5M for Super Bowl commercial spot

The National Football League hasn’t started yet but media giant ViacomCBS Inc (NASDAQ: VIAC) is counting on a potential major payday for SuperBowl commercials, The Wall Street Journal reported.

Wait… what?

The SuperBowl is known to pack tens of thousands of football fans into a stadium while another 100 million or so tune in on live on TV. Yet despite what could be a match in a completely empty stadium, and no guarantee of a similar TV audience, CBS is asking advertisers to fork over $5.5 million for a 30-second commercial, people close to the matter told WSJ.

The price tag is roughly in line with what was paid in 2020. However, CBS is adding on an additional $200,000 required fee to each commercial for online streaming.

Ad buyers are unlikely to commit to such a high price tag unless it comes with a refund guarantee if the NFL season is paused, postponed, or doesn’t start at all, the sources said. CBS is open to offering advertisers a refund, although the media giant has only offered a verbal promise.

Ad buyers are asking for a refund guarantee to be included in writing, and CBS has yet to do so.

A tough sell

The Super Bowl is among the most coveted events for brands that often produce a humorous commercial in the hopes it goes viral. It is also a major opportunity for the rotating TV station that hosts the match.

Last year, according to WSJ, Fox’s total Super Bowl ad revenue was $525.4 million.

But this time around, the COVID-19 pandemic has left its mark on the advertising industry. Marketers have lowered their ad spending budget in response to the pandemic, especially across Super Bowl fan favorite categories like movies, retail, and restaurants.

However, there are still many brands with cash to spend and CBS could still accept a deal just a few weeks before the big game. This may prove to be the case for many interested ad buyers if the COVID-19 pandemic worsens over the coming months.

“To commit that amount of money to something that is an unknown seems at this time fiscally irresponsible,” advertising buying expert Carrie Drinkwater told WSJ.

But at the end of the day, the Super Bowl always has, and always will be the premier, most-watched TV show worldwide. The football league will be counted on to offer a compelling event and deliver higher ratings and value to advertisers.

CBS, and its group of investors born out of the merger with Viacom will certainly be counting on it.