Grammy Ad Rates Climb to Record $900,000 Per Spot

Ads for this Sunday’s Grammy Awards have reached an all-time high of $850,000 to $900,000 for some 30-second spots, a 9 to 12% increase from 2012, according to five executives familiar with negotiations who spoke with Chevrolet, Delta Air Lines, Harman, Hilton Hotels & Resorts, Hyundai, MasterCard, Pepsi and Procter & Gamble’s Cover Girl, Olay and Herbal Essences are among the brands confirmed for on-air and Grammy-related sponsorships.
While that figure seems relatively small in comparison to the Super Bowl, where 30-second spots went for as much as $4 million this year, it could have been even higher given the unexpected ratings bump CBS received from the 2012 ceremony. Airing less than 24 hours after Whitney Houston’s death, the telecast became the second most-watched Grammys ever, with 39.9 million viewers and a 33 household share, according to Nielsen. Ad rates were sold at an average $766,000 per 30-second spot, per Nielsen, giving sponsors a significant uptick in added audience.
“We’re not pricing based on 2012,” says Dean Kaplan, CBS’ senior VP of planning and estimating. “While we were pleased with last year’s rating, we’re estimating 2013 based on the growth from 2008 leading up to 2012. We’re being realistic, and had no problems in the marketplace.”
In addition to the last-minute tribute to Houston, the 2012 Grammys had other tune-in worthy storylines like Adele’s first performance since canceling her tour for vocal cord surgery (and eventual sweep of the night’s major categories). This weekend’s telecast doesn’t quite have the same star wattage, though certainly Justin Timberlake’s first televised solo performance in six years is a worthy ratings draw, as are confirmed performances from Taylor Swift, Ed Sheeran & Elton John, Fun., Mumford & Sons, Frank Ocean and a just-announced collaboration between Sting, Rihanna and Bruno Mars performing a presumed mega-medley of “Message In A Bottle,” “Love Without Tragedy” and “Locked Out Of Heaven,” respectively.
The Grammys have also become an increasingly large draw on social media — last year’s event recorded a historic 13 million total U.S. Facebook and Twitter comments, according to analytics firm BlueFin Labs, with social-TV company Trendrr placing the 2012 Grammys just behind the 2012 Super Bowl in all-time global social-media activity. It also skews younger than the Academy Awards, garnering a 14.1 rating among viewers 18 to 49 compared to the Oscars’ 11.7.
“It’s a premiere property with pretty broad appeal that skews a bit younger because of the musical appeal,” says Helen Giles, director of national broadcast and video integration at Campbell Ewald. “It will be interesting to see what happens this year when you don’t have the Whitney situation, but you never know what will happen in a live event.”
The Grammys’ audience was attractive enough to convince Chevrolet to alter its media strategy for 2013, opting out of the Super Bowl for the first time in years to debut its new tagline, Find New Roads, during Sunday’s telecast. “There’s truly a symbiotic relationship between Chevy and music,” Molly Peck, Chevrolet’s national advertising director, told Billboard in a recent interview. “Really there’s no other auto company that has this strong equity and an intrinsic, beneficial relationship with music. It all makes sense that we would nurture and grow our equity with music as we go through our campaigns.”
Pepsi also made a shift from the Super Bowl to the Grammys with its plans to feature its latest “X Factor” winner, country singer Tate Stevens, in a new commercial as part of the singer’s $5 million prize package from the brand. “The Grammys were the perfect opportunity to launch this artist's career, and in almost a different way than the Super Bowl,” Chad Stubbs, Pepsi’s senior director of media strategy, told Billboard in October. “What’s better than what's been trademarked as music’s biggest night? Thinking of our music connections and music assets was part of what led us to the Grammys.”
Also look for Harman International to debut creative featuring a musician spokesperson (Paul McCartney and Jennifer Lopez appeared in spots for the audio entertainment company last year) as well as P&G’s CoverGirl, who’s tapped artists like Pink, Janelle Monae and Nervo in recent months to join a roster of spokeswomen that already includes Swift.

“CoverGirl is glad to be a sponsor of the Grammy Awards,” said the brand’s Esi Eggleston Bracey. “This partnership gives us a great platform to celebrate all the ways women rock their beauty!”