• Edward Nevraumont

Super Bowl and Adjacency

Welcome to Marketing BS, where I share a weekly article dismantling a little piece of the Marketing-Industrial Complex — and sometimes I offer simple ideas that actually work.


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Thanks for reading and keep it simple,

Edward Nevraumont

Super Bowl and Super Commercials

Do you watch the Super Bowl for the football or for the commercials? As a subscriber to Marketing BS, chances are high that you enjoyed watching (and critiquing) the biggest showcase for new commercials all year. (You can watch the 35 best ones here)


Who “won” the contest for the most entertaining or engaging commercial? Many media pundits are handing the trophy to Google for their “Loretta” ad, a heartwarming story about an elderly man who uses Google Assistant to reminisce about his late wife.

In addition to the usual suspects — like Budweiser, Hyundai, and Pepsi — we saw the first-ever national ads for presidential candidates (Barack Obama ran regional ads during the 2008 Super Bowl). During the course of the evening, not one but two politicians ran spots: President Donald Trump and Former-NYC-mayor-turned-Democratic-candidate Michael Bloomberg.


According to CNBC, the other advertisers were not pleased by the political ads:

Some consumer brands are concerned that all the attention will be focused on Trump and Bloomberg’s pricey ad buys as the election approaches. Fox has told marketers that it will put the political ads in their own commercial segments to avoid detracting from other commercials, according to two people who didn’t want to be identified because of industry connections.

Did Fox need to separate the political advertisements from the commercials for beer, cars, and snack food? What do you think: Does it REALLY matter what other ads appear next to your own commercials? I don’t know if I have the answers for those questions, so I’d like to share some of my current thoughts. 

Impressions Matter

Let’s start with what do know: “impressions” matter. If your ad ends up in front of more people, you should — all things being equal — be willing to pay more money. (As a standard metric, the advertising industry uses CPM, or “cost per thousand impressions”).


Another truism: “length of impression” matters. If your ad ends up in front of people’s eyes for a longer period of time, then you should — again, all things being equal — be willing to pay more money. This idea explains why a 60-second TV spot is more expensive than a 30-second TV spot. Less obviously, if your print ad appears next to very engaging content, then your ad will be visible for longer than if it appears next to less engaging content (or another ad). For better ad placement, you should also be willing to pay more per impression.


Can we go further with this concept of adjacency? Does the CONTENT placed next to your ad have any impact on value? Or is the content irrelevant, as long as the material is engaging enough to keep viewers’ attention? 


I believe that advertisers THINK the type of content matters.


As I covered in “Tumblr and Unseemly Arbitrage,” the CPM rates for ads on pornography websites are almost two orders of magnitude less expensive than non-pornographic sites (and I don’t think this fact is driven by “engagement time”…). Moreover, many brands have expressed concerns about advertising next to “amateur content.” YouTube, for instance, carefully navigated the transition period of majority-amateur to majority-professional videos on their site. 


In addition to concerns about adjacency to unseemly content, many brands take an (over)abundance of caution when dealing with sensitive topics. Consider, for example, the television show “24” starring Kiefer Sutherland as an agent in a Counter Terrorist Unit. The narrative action is ignited by news of an exploding airplane. The show was scheduled to air on November 1st, 2001 — less than two months after the 9/11 terrorist attacks. The TV network (Fox, once again) decided to postpone the show’s premiere and to remove footage of the plane’s explosion.  


In similar fashion, some of this year’s Super Bowl commercials were altered at the last minute, to avoid insensitive associations with the January 26th death of basketball legend Kobe Bryant and eight other passengers in a helicopter crash. Days before this tragedy, Planters launched an ad campaign featuring the death of Mr. Peanut, their 104-year-old mascot. Although Planters paused all promotional activity in the wake of Bryant’s death, they decided to go ahead with the “funeral spot” during Sunday’s game. Luxury car brand Genesis re-edited its commercial to remove the presence of a helicopter. Likewise, the Hard Rock Cafe made “unspecified edits” to its ad, which it felt “could be perceived as insensitive.” Notably, the commercial was directed by Michael Bay, a Hollywood director known for spectacular crashes and explosions. [quotes from a WSJ email newsletter not available online]

A Flag on the (Political) Play

Companies don’t want to be associated with pornography or any other content that is considered “unseemly.” Could proximity to political advertising be just as toxic? You can understand why brands might worry: consumers expressed a clear preference against seeing political ads during the Super Bowl. As noted in a WSJ article:

63% of Americans call the Super Bowl an inappropriate platform for political ads from candidates, according to the poll, conducted online this month by Morning Consult for CMO Today.
The aversion seems to span political affiliations. Some 63% of people who said they voted for President Trump and 62% of those who said they are Republicans don’t want to see the president advertise during the Super Bowl, the poll found. And 56% of Democrats said they don’t want to see Mr. Bloomberg’s planned ad during the game.

Regular Marketing BS readers know that I don’t usually trust what consumers say (due to desirability bias). Nevertheless, I appreciate why many marketers take these surveys at face value. So, given that consumers do not like the idea of political ads running during the Super Bowl, should marketers care if their company’s commercial plays immediately after one for for Trump or Bloomberg?


The (preliminary) research suggests that marketers DO care about advertising adjacency.


A 2019 research paper (by Sila Ada, Nadia Abou Nabout, and Elea McDonnell Feit) investigated what happens to rates when advertisers knew more information about the placement of their online ads. The project studied a major European ad exchange that addressed advertisers’ concerns about brand safety by implementing greater transparency. (In previous years, YouTube faced criticisms over the placement of ads near extremist content; as a result, many companies demanded greater knowledge about the placement of their ads). The article offers context for the platform they studied: 

Prior to the change, the platform had provided buyers with a list of sites where ads may appear, but had not provided the URL in the bid request for each impression. 

The experiment tested whether advertisers were willing to pay a higher rate for the ability to know the specific subdomains on which the ads would appear. In an email exchange, McDonnell Feit stated that advertisers WERE willing to pay more: “We can't say whether the ads had greater effectiveness, but we can say definitively that advertisers were willing to pay more when they knew the subdomain.” 


Based on this type of research, we shouldn’t be surprised that Fox only ran the political ads during their own commercial breaks, instead of scheduling them back-to-back with other companies’ commercials. Even if advertisers don’t KNOW that adjacency to political ads will hurt their brand, that very IDEA could have reduced the prices that advertisers were willing to pay for air time. Fox, of course, wanted to optimize advertising revenue.  

Final Thoughts

We still haven’t answered the question: are the advertisers correct? Would adjacency to the Trump or Bloomberg commercials reduce the effectiveness of a brand’s Super Bowl ad? 


My suspicion: adjacency does NOT matter. 


A 2011 research paper in Management Science theorized that advertisements placed next to related content were more effective than ads located near unrelated content. As a hypothetical example, a magazine ad for an automotive company would perform better if it were placed next to an article about summer road trips than it would next to a profile of a florist. I understand the logic of this hypothesis, but I expect that most — if not all — of the differences in the ads’ (perceived) effectiveness could be explained by the selection effect. 


I asked Peter Fader (marketing professor at The Wharton School) about the possible impact of advertising adjacency, and he echoed my suspicions: “I’m not aware of any formal research on the topic, but I’m skeptical that there would be any negative effects there.”


If researchers cannot verify the negative impact of adjacency, why were Super Bowl advertisers so antsy about the scheduling of the Trump and Bloomberg ads?


The answer relates to an opinion I occasionally share: a lot of marketing has nothing to do with effectiveness. Many CMOs make decisions in order to expand their departments (to boost the chance of promotion) or to avoid controversy (to reduce the likelihood of termination). The end result is a risk averse philosophy. A recent article in The Drum emphasized the cautious character of many marketing strategies, especially among major companies. Many brands and agencies are taking steps to ensure their ads will not appear next to unseemly content: 

‘Sex’, ‘violence‘, ‘death‘, ‘alcohol‘, ‘slavery‘, ‘kill‘, ‘injury‘, ‘shoot‘, ‘disaster‘ and ‘bastards‘ – these are some of the keywords brands are choosing not to advertise against in 2020, enlisting automated tech to stop their ads from appearing around content containing these words. ... However, blacklists aren’t just protecting brands against misplacement: they’re also blocking active participles that feature in trusted publishers’ most important and most-read news stories, creating a deficit of support for hard-hitting journalism.

An example from The Drum highlights the folly of such restrictions: marketers automatically stop their ads from appearing next to articles that contain the word “shoot.” As such, any content that uses “shoot” in non-violent contexts — like basketball coverage — will have less advertiser demand. Lower demand means a lower advertising clearing price. Because the most reputable journalists will not adjust their writing for advertiser concerns (while many lower-quality outlets will), it results in a tax on the highest quality content. The Drum recommends that advertisers find more sophisticated tools to understand the context in which the concerning word is placed. Although a company might not normally want their ads to appear next to articles about killing, they would certainly welcome the placement of their ads in proximity to a feature article about the (extremely popular) Game of Thrones finale.


I would press those advertisers even further: does it actually matter if your ad appears next to an article about a death or a disaster (or a Trump or a Bloomberg)? If not, then rational marketers might discover a significant arbitrage opportunity.


Do you think adjacency matters as a marketer? What about as a consumer? I would love to hear your thoughts! And if you know of any sources that analyze the impact of advertising adjacency, I would really like to read them. Please reply to this email or post in the comment section below. 


Keep it simple,

Edward


If you enjoyed this article, I invite you to subscribe to Marketing BS — the weekly newsletters feature bonus content, including follow-ups from the previous week, commentary on topical marketing news, and information about unlisted career opportunities.

Edward Nevraumont is a Senior Advisor with Warburg Pincus. The former CMO of General Assembly and A Place for Mom, Edward previously worked at Expedia and McKinsey & Company. For more information, including details about his latest book, check out Marketing BS.

© 2020 EDWARD NEVRAUMONT
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