Business Behind the Madness

TSM Blog Post 6

March is here, and to TSM, that means one thing...March Madness. Some conference tournaments have already tipped-off, set to provide us with this year’s “Cinderella Story” contenders, and the rest of the conferences will be underway this week. Then, next week, we will be greeted by all of the excitement and drama that comes with “The Big Dance"

A few underrated and underpublicized programs, some powerhouse programs, and several student-athletes will showcase their talents on this huge stage, the size of which the majority of them have not stepped on to date in their young careers. But, like all big-time sporting events, the schools, the players, and the families are not the only winners this month. A number of big name products, and the NCAA itself, will rake in the benefits of the madness. Behind the buzzer beater game-winner, all of the 12-seeds, and the story of the senior point guard that dominated the tournament but may never actually make it to the NBA, lies the business of March Madness.

Why is sponsorship at the NCAA tournament such a great opportunity for companies? For one thing, people are watching these games live. With more and more people recording television shows, watching them later, and fast-forwarding through the commercials, March Madness provides several full-length days of basketball games that you can be sure people will consume live, commercials and all. Everyone is keeping their bracket updated and preparing for the next day’s “water cooler” conversations. The brackets and pools that exist make the casual fan a committed one, and turn non-fans into casual ones at the very least. Consuming March Madness has become a staple in society. The real gamblers will wage around a combined $9 billion throughout the tournament, which is about double the amount of action the Super Bowl gets. Companies who are investing as sponsors of this month-long event can be confident in their monetary investment knowing the viewership and consumption will be at an extremely high level.

The numbers certainly back this theory up. The 2015 NCAA tournament was the most-watched NCAA tournament in 22 years, according to Nielsen Fast Nationals. The tournament averaged 11.3 million total viewers, and the National Championship game, which saw Duke defeat Wisconsin, averaged 28.3 million total viewers.

The sponsors are winning, but of course, a winning sponsorship is preceded by a financial commitment. According to Jim Andrews, senior vice president at IEG (a team that analyzes sponsorships), the NCAA offers a few different sponsorship packages to companies to use for marketing. “Corporate Sponsors” pay $10 million for a combination of commercial time and marketing opportunities such as the use of the NCAA logo, and a “Champions” sponsorship package is in the $30 million to $35 million range. The average price of a 30-second commercial in 2015's championship game was just under $1.56 million, according to Kantar Media.

In addition to money from sponsors, another big check for the NCAA comes from broadcast rights. In 2010, the NCAA and CBS/Turner inked a 14-year broadcasting rights deal for $10.8 billion.

So, while the 18 year old kid who overcame all sorts of adversity to receive his scholarship to allow him the opportunity to hit the game winning shot may be the one hoisting the trophy over his head, he’s not the only one smiling at the end of March. The sponsors and the NCAA are the big winners of the Big Dance.

Sports sponsorship is one of the many services TSM provides for our company clients to help increase brand awareness, brand loyalty, and enhance their overall brand. Be sure to check out the full list of the services we provide, and if you think TSM might be a good fit for your brand, contact us today!

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