The Sports Professor Rick Horrow, in conjunction with promotional partner Northern Trust, analyzed three major business questions surrounding March Madness this month. Part One explored the specific business questions of college basketball. Part Two looked at women’s college basketball surrounding its tournament. Part Three analyzes the Final Four in Indianapolis.
The past nine Final Four Championship Games have averaged over 46,000 fans in such large domed facilities as Atlanta’s Georgia Dome, Louisiana Superdome, the San Antonio Alamodome, and St. Petersburg’s Tropicana Field.
This year, the tournament heads to the RCA Dome in Indianapolis, the first Final Four in that city since the NCAA long-term deal to place multiple Final Fours in the to-be-constructed Lucas Oil Stadium (future home of the Indianapolis Colts). This is a far cry from 1939, when 5,500 basketball fans watched Oregon beat Ohio State in the first ever men’s Division I basketball championship.
Four business issues are key to this week:
TV, CORPORATE AMERICA, AND THE FINAL FOUR
Early cumulative overnight ratings for this year’s March Madness have been mixed. During the first four days of the tournament, ratings were down 5.1 percent, but subsequent momentum from dramatic games and underdog upsets has boosted ratings significantly.
Regardless of the ratings fluctuation, the Sweet Sixteen and Elite Eight match-ups generated huge interest – and Corporate America increased its ad spending to well over $467 million for the tournament. Over 20 new advertisers entered March Madness this year, including Cisco, Lowe’s, Comp USA, and IBM. Microsoft returned from a two-year absence, and Nissan increasing its spending. At a time when the likes of Anheuser-Busch and Chevrolet have decreased their overall ad spending by more than 25 percent, corporations love the premium buy that the Rose Bowl, Super Bowl XL, and the Winter Olympics [collectively] couldn’t generate.
Applebee’s has deluged the airwaves with a Gilligan’s Island-themed ad, and Coca-Cola sued Stokely-Van Camp over a Gatorade-Powerade battle. The impact of big ad spending on the NCAA can’t be overstated. Between the $618 million that Corporate America spends on college basketball advertising throughout the year, and the $300 million it spends on college sponsorship and signage, corporations spend nearly $1 billion in supporting big-time college athletic economics.
THE INTERNET AND THE MYTH OF THE PERFECT BRACKET
If the 2006 Winter Olympics are known as the Internet Olympics, this NCAA tournament should be referred to as Cyber March Madness. The CBS “March Madness On Demand” strategy, making games available for free (but selling significant advertising) seems to be working. More than 14 million live video streams were recorded during the first weekend of the tournament. CBS said the numbers are believed to surpass the number of visits recorded for any previous live event, including NASA’s Space Shuttle Discovery coverage.
For the last three weeks, America has been obsessed with bracketology. With all No. 1 seeds eliminated before the Final Four for the first time since 1980, most fans are relegated to watching the games for the pure sport of it.
Even during a predictable year, the odds of filling out a perfect bracket are ONE IN NINE MILLION TRILLION. According to the Wall Street Journal, you are 60 billion times more likely to win the multi-state Powerball lottery than to score perfection with your bracket. Think they don’t follow March Madness at MIT and CalTech? Think again. A largely unsung group of NCAA fans are statisticians specializing in mathematical bracketology, who each year devise complex probability calculations and power ratings to quantify likely winners.
At the end of the day, however, they've proved no more accurate than the uninformed fan who makes his picks based on a school's uniform color or mascot.
