Super Bowl All About Money, From Pricey Seats to Party Passes: Slide Show
The Super Bowl rematch between the New York Giants and New England Patriots was predicated upon money spent on player contracts, venue construction and pricey seats before the annual National Football League contest gets underway at Lucas Oil Stadium in Indianapolis on Feb. 5.
1. Big Money
Maybe they should call it the Super (Expensive) Bowl. With nosebleed game tickets topping $2,200, hotel rooms marked up as much as 1,758 percent and 30-second television ads selling for an average of $3.5 million or $116,667 a second, Super Bowl XLVI is a corporate and consumer spending spree. It is marketing and merchandising gone mad -- the NFL even offers up a Commemorative Super Bowl app at $2.99 or 50 percent off pre-game. What follows are some of the larger costs in the Super Bowl economy.
2. Building the Stadium
Before Indianapolis could make a bid to host a Super Bowl, it needed a stadium worthy of the NFL championship. Lucas Oil Stadium cost $720 million to build at a very real cost to taxpayers. The Indianapolis Colts provided $100 million, and the state of Indiana and city of Indianapolis both raised funds. Marion County increased taxes on food and beverage sales, auto rentals, and hotels, among other things. Surrounding areas added a 1 percent restaurant tax. The Capital Improvement Board, which oversees the stadium, may lose about $800,000 hosting the game.
3. Building the Teams
According to NFL.com, the Patriots and Giants spent about the same amount on player salaries this season -- $63.7 million for the Giants and $62.3 million for the Patriots. Just how they allocated that money was very different. The Patriots spent much more on offense salaries ($39.7 million vs. the Giants’ $30.4 million) and more on special team’s salaries ($4 million vs. $3.5 million). New York outspent the Patriots on their defensive players, paying $29.8 million compared with $18.6 million for New England.
4. Being a Good Host
The Indianapolis Super Bowl Committee’s operating budget for its three-block Super Bowl Village is $25 million, which was raised privately from individuals and corporations. A good chunk of that $25 million paid for the village venue, which includes four zip lines, the super dash (run in human-sized hamster wheels) and 75 bands. Among other outlays, the city of Indianapolis budgeted $4 million for public safety costs to be reimbursed by the Capital Improvement Board through taxes generated from hotels, restaurants, and so on. PricewaterhouseCoopers predicts direct Super Bowl spending in the Indianapolis area will be about $150 million, though other estimates place the number at $356 million.
5. Ticket Lotteries
The majority of tickets go to the two teams, which hold drawings for full-season ticket holders and those with club seats or suites. To get season tickets, Giants’ fans pay a one-time personal seat license, or PSL. In 2011, a $20,000 PSL gave the right to buy tickets at the 50-yard-line Coaches Club at $700 per game. A $7,500 PSL in the Mezzanine B section offered the right to buy tickets for $400 a game. Patriots’ fans who want season tickets face a long waiting list. To get on the list fans pay $100 for a membership. Season tickets cost between $65 and $185 per game.
6. Ticket Resellers
The face values of tickets are $800 to $1,200. The cheapest listing on SeatGeek, an event ticket aggregator, is $2,247 for an upper-deck end-zone seat. Prices have declined recently, according to TiqIQ, a ticket event aggregator that tracks listings from StubHub, EBay Inc. (EBAY), TicketNetwork and TicketsNow. The average ticket price fell to $3,982 from $4,311 since Jan. 27; the cheapest ticket fell from $2,400 to $2,090. The most expensive ticket purchased on the NFL Ticket Exchange, the league’s official resale website, was sold the week of Jan. 23 for $16,480.
7. TV Upgrades
According to a National Retail Federation survey, 5.1 percent of Americans will buy 5.1 million new TVS for the game. The Consumer Electronics Association says about 1.9 million TVs were bought in the first six weeks of 2011, a number unchanged from 2010. Currently, 87 percent of Americans have a high-definition television, the industry group says. Consumer Reports says it makes sense to wait until late February when retailers usually discount TVs to make room for new models.
8. Vegas Gambling
Last year the Nevada Gaming Control Board counted $87.5 million in bets on the Super Bowl, an increase of 5.8 percent from 2010. Far more -- as much as $10 billion -- is bet in office pools and with illegal bookies. Such figures are “nonsense,” says Eugene Christiansen of consulting firm Christiansen Capital Advisors. “No one has a basis for such estimates.” Many Vegas bookies are rooting for the Patriots because of large bets made on the Giants in late 2011, when a four-game losing streak made them, at one time, 100-1 underdogs to win the Super Bowl.
9. High-priced Visits
Cheaphotels.org compared rates for hotels in and near Indianapolis on Feb. 5-6 with the rate a week later. The biggest markup was at Knights Inn, Indianapolis Airport, where the rate for Super Bowl weekend is $725. A week later, the price drops to $39. For those with no budget concerns, flying by private plane is popular. Nicholas Bozzo, of PlaneClear in Long Island City, New York, says volume out of New York for Super Bowl weekend is up 50 percent to 60 percent compared to last year. Planes with six or seven seats go for $12,000, he says, while 12-to-14- seaters run $30,000.
10. Super Parties
Leading up to the game, “there will be hundreds of parties with thousands of people at each,” according to Tim Fraser of TicketNetwork.com, which allows licensed sellers to make tickets available on its site. In Indianapolis, for those who don’t get complimentary passes, a ticket to the Maxim VIP Party with Maxim girls, food, open bar and live entertainment is being offered for $1,603 on TicketNetwork.com, while a ticket into the Playboy VIP Party with live music by Ne-Yo can be had for $1,508. A ticket to the ESPN party, where Drake will perform, is selling for $1,037. For those on a budget, there’s the Leather & Laces party hosted by Jenny McCarthy and Carmen Electra. Ticket- sellers are asking $437 to almost $9,000.
11. Snacks and gear
Consumers are expected to spend $11 billion on game-related food, clothing and merchandise, according to the National Retail Federation. That’s $64 per person, up from $60 last year. Nearly $700 million will go for snacks, including 1.25 billion chicken wings that increase in price in the fourth quarter as restaurants stock up. On game day, Yum! Brands Inc. (YUM)’s Pizza Hut, whose sales jump 50 percent compared with normal Sundays, expects to sell more than two million pizzas -- 80 percent with pepperoni -- at about $10 each. Public Affairs Director Christopher Fuller says Feb. 5 could be Pizza Hut’s best day ever.
12. Television Ads
As many as 115 million viewers will watch the game, according to a Bloomberg story. NBC Universal, which renewed its contract with the NFL for an undisclosed amount, has sold all 70 ad slots at an average price of $3.5 million. Among this year’s ads: Hyundai shows how its car can quicken the pulse of a man with no pulse and Samsung mocks Apple Inc. (AAPL) fans with its own version of the “Next Big Thing.” Last year, in the week after they ran Super Bowl ads, VW Passat interest surged 70 percent on Edmunds.com and Chrysler interest soared 87 percent.
13. Bonuses and Rings
Players on the winning team receive an $88,000 bonus, while losing players get $44,000. Those payouts have risen since the first Super Bowl in 1967, when winners got $15,000 and losers received $7,500, the equivalent of $102,000 and $51,000 in inflation-adjusted dollars. Players, coaches, executives and others associated with the winning team also get Super Bowl rings. While the NFL will pay up to $5,000 per ring for 150 rings, prices can go well beyond that depending on the level of bling desired. The Green Bay Packers’ 2011 rings are made of platinum and 18-karat gold, with 3.35 carats of diamonds.
To contact the reporter on this story: Suzanne Woolley in New York at Swoolley2@bloomberg.net. Ben Steverman in New York at firstname.lastname@example.org. Nikhil Hutheesing in New York at email@example.com.