The Super Bowl is as American as apple pie and Thanksgiving dinner. It is a reason for people to get together, eat, and enjoy sports and the good company of friends and family. The beauty of this annual event is that it appeals both to sports fans and those who don't even follow football alike.
The highlight of any sports season, regardless of the level of professionalism, is the crowning of a champion and the award ceremony to follow. Granted, there is a pretty clear line of distinction between grade school ball and the organizers shopping for the lowest price guaranteed, custom trophies and the sought after Super Bowl ring. That's not to say professional sports are particularly more important, but events such as the Super Bowl definitely impact the world we live in; namely, via the economy.
Whether you love the game of football or not, the commercials and halftime shows have worldwide notoriety. Having ads on television is an expensive venture in itself, but when you couple that with the captive audience for an event such as this, companies are paying dearly for the opportunity to advertise their product on such a highly televised event.
The cost of a thirty-second commercial during the 2020 Super Bowl was $5.6 million. That does not include the millions spent producing the advertisement. Does the cost justify the venue? Considering that year after year, prominent companies are buying into the ever-rising costs of advertising during such an event lends to the reasoning that it does.
Every year, host cities anticipate a large economic boost due to the influx of visitors to their town. Economists continually find flaws in this reasoning and try to explain that although it seems that the Super Bowl should increase economic growth, the benefits are fairly negligible.
While it's true that spending goes up significantly with people preparing for their parties and Super Bowl events, the benefits to the host cities themselves are not overly apparent. The crowds drawn to host cities for this annual sporting event may seem significant because of their sheer numbers but the bottom line is, it displaces the visitors who would normally visit the town for local draws such as fishing or golfing.
Hosting a big event such as the Super Bowl can be trying for local businesses. In order to accommodate all of the visiting fans, business is disrupted, streets are closed and special dispensations made. To add to that, the NFL requires its events to be exempt from local taxes, and the benefits diminish even further.
Of course, after Super Bowl Sunday comes Super Bowl Monday. An estimated 17.5 million workers take the day off after this huge sporting event. Another 11.1 million Americans, if they did not take the day off altogether, will either come to work late or leave early on this particular day. So what does this mean for our economy? On any given day, if 17.5 million Americans do not go to work, it will cost the country about $3.4 billion in productivity. If you add to that the lost productivity of the 11.1 million that are not working a full day, that number shoots up a staggering $3.7 billion in lost productivity.
You may be wondering why productivity is such a concern and the reason is simple. Productivity is the driving force of businesses. When a business's productivity drops, businesses lose money as well as the competitive edge they may have had on competitors. Although that may be a recoverable event for some more established and stable companies, others may flounder.
Everybody loves the Super Bowl. At the personal and inter-personal level, the benefits are huge. At the municipal level, however, the costs are quite high. Do they cancel each other out? What do you think? Let us know!