Super Bowl XLVII: Bringing big bucks to the Big Easy
- 1 February 2013
- From the section Business
America's National Football League championship game, known globally as the Super Bowl, is upon us once again.
This year's 47th edition pits the San Francisco 49ers against the Baltimore Ravens in New Orleans, Louisiana, and claims as its most interesting storyline two close-knit brothers coaching against each other for the title.
But the biggest story this week in the Big Easy (as New Orleans is nicknamed), as happens every year, is the remarkable revenue the week-long Super Bowl celebration brings in to the host city, the television networks broadcasting the game, and the National Football League itself.
The 3 February NFL championship marks the tenth time the Super Bowl will be played in New Orleans, equalling it with Miami as the most frequent host city.
More significantly, this is the first time New Orleans is holding the game since Hurricane Katrina devastated the Gulf Coast region almost eight years ago.
It's hard to forget the images of New Orleans broadcast around the world in August 2005 - a city half under water, its citizens trapped on rooftops or packed in the fetid shelter the Superdome had to offer, armed soldiers and tanks patrolling the streets to prevent widespread looting, or worse.
It wasn't inexpensive or easy to get New Orleans back in good enough shape to host the Super Bowl - necessary renovations to the Mercedes-Benz Superdome alone totalled $336m (£212m), and overall, New Orleans continues its slow rehabilitation from the storm.
But for New Orleans, the positive economic and psychological impact the Super Bowl brings might be just the cure the hurricane doctor ordered: Super Bowl XLVII is expected to generate a $423m economic boost, up substantially from the $323m Indianapolis produced in 2012.
To prepare for the Super Bowl, New Orleans has invested $1.2bn on various civic improvement projects, including extensive road work, a new streetcar line, renovations to Louis Armstrong International Airport, and numerous private hotel makeovers.
The Super Bowl Host Committee alone raised $13.5m - some $6m from the state and $7.5m from corporate sponsors.
A lot more money will be changing hands in New Orleans and elsewhere in America this weekend. Tickets to the game on secondary ticket marketplaces are averaging $3,100, making the street value of 76,000 seats about $237m.
Super Bowl merchandise revenue is expected to be around $150m. Legal gambling in Las Vegas, Nevada. should top out around $100m, while illegal betting across the country will total more than $1bn (with few exceptions, sports betting outside Nevada is illegal in the States).
For the hotels, restaurants, and nightclubs throughout the region, from the bars on Bourbon Street to such restaurants as Emerils and Galatoire's - famous for their spicy Cajun and Creole cuisine - Super Bowl revenues provide a much-needed boost to still-recovering businesses.
As is typical, 90% of the rooms in the city are committed to the NFL, so some visitors find it necessary to find lodging as far as Baton Rouge, roughly 130 km (84 miles) away.
Restaurants such as Walk Ons, near the Superdome, offer one Super Bowl-themed promotion after the other - Walk Ons will sell $100 tickets guests can use toward food and drink purchases the day before the game, when the establishment tries to break the world record for the "Largest Seafood Boil".
As for the teams vying for the championship, sports fans in the UK should be somewhat familiar with the San Francisco 49ers (a team that boasts five Super Bowl wins), since they played in the NFL International Series game at Wembley in 2010.
Super Bowl viewers will get a partial preview of this year's Wembley match, as the Niners are scheduled to play the Jacksonville Jaguars there on 27 October.
The Baltimore Ravens, founded in 1996, are one of the NFL's newest teams, but nonetheless managed to get a Super Bowl victory under their belts in 2001.
According to Forbes, the 49ers are the ninth most valuable NFL team at $1.18bn, while the Ravens are the eleventh most valuable squad, at $1.16bn - almost pocket change compared to Manchester United, which just surpassed the NFL's Dallas Cowboys to be named the world's most valuable sports franchise, at more than $3bn.
For the vast majority of people around the globe, of course, the Super Bowl is a television event - one that provides a healthy chunk of the annual operating budgets both for the NFL itself and for its television partners.
In the US, it's CBS's turn this year. The network paid a whopping $622m for its NFL rights this season, but it will make up more than one third of that expenditure from the advertisements aired on Super Bowl Sunday alone.
New ads created
Super Bowl commercials this year are averaging a record $3.7-$3.8m per 30-seconds, with some ads having sold for more than $4m. The total estimated ad revenue for CBS is $263m (approximately 70 ad spots at an average cost of $3.75m each).
The Super Bowl is much more of an entertainment platform than just a sports championship.
Outside of its splashy halftime programme featuring the likes of the Rolling Stones, the Black Eyed Peas, Madonna, and Beyonce this year, its unique and innovative ads are the main reason that millions of people watch the game in the first place.
Super Bowl ads are generally created exclusively for the game, more often than not to launch a new product, and do their best to be as memorable - and provocative - as broadcast censors will allow.
Anheuser-Busch's Bud Light, Doritos, the webhosting company Go Daddy (featuring glamorous racing car driver Danica Patrick), carmakers, and the duelling soft drink giants Coca-Cola and Pepsi are Super Bowl regulars. In the social media world, reaction to their ads is instantaneous, and sometimes, quite harsh.