The other day I wrote up a short piece about the cost of Super Bowl ads -- $83k/second, or roughly $2.5 million for a 30 second spot. This got me to thinking... How does a company like GoDaddy.com justify this sort of an expenditure? I saw at least two GoDaddy ads during the Super Bowl. Given that their main business is registering domain names for $8.95 apiece, I can't figure out how this is a good move on their part. Yes, they're building a brand. But... They'd have to sell close to 280,000 domain names over and above what they would have otherwise sold in order to generate an extra $2.5 million in revenues, and this doesn't take into account their expenses (or the fact that they ran more than one ad). Granted, domain registration isn't their only business. They also offer hosting and a bunch of different 'upgrades' when you register your domain name, but still... This seems like an awfully big expenditure for a business like GoDaddy. Then again, they've got people like me talking about them, so maybe the buzz that they created is worth it in the end.

--
Please CLICK HERE to read/leave comments on this entry

"The Economics of Super Bowl Ads" was first published at fivecentnickel.com

mortgage calculator