March Madness is about to get even wackier this year, but at what cost?
The annual NCAA Men’s Basketball tournament of champions attracted 23.4 million television viewers last year, says CBS Sports. Each year millions of armchair point guards try their hand at predicting the outcome of the 64-team bracket in local office pools. However, Quicken Loans and Warren Buffett hope to initiate much more than water cooler bragging rights this year with what could be considered the mother of all guerrilla marketing tactics.
Quicken Loans founder and NBA owner Dan Gilbert announced a $1 billion prize to any fan that correctly predicts the “perfect bracket” before the 2014 rendition of the NCAA tournament. This prize is being insured by Buffett, the world’s fourth richest man, through one of his companies – Berkshire Hathaway. Essentially, Quicken Loans pays Berkshire Hathaway to cover the billion-dollar prize, should someone enter a perfect bracket in the contest.
While the odds are astronomically low, the buzz is deafeningly high. The question we ponder is how a brand like Quicken Loans can effectively own this considerable amount of the positive energy surrounding the NCAA Men’s Division I Basketball tournament without paying to be one of the organization’s corporate champions and partners.
While Quicken Loans has sponsored the Carrier Classic, an annual college basketball contest turned outdoor spectacle aboard a US Navy aircraft carrier, since 2011, this does not garner them rights to the NCAA Tournament. With this announcement, president and marketing chief Jay Farner hopes they can earn an even larger place in the heart of college basketball fans. But at what cost?
It’s tough to argue the virtuosity of Quicken’s marketing ploy. The buzz generated by the incentive of a billion bucks should make their investment worthwhile, especially since they are paying pennies on the dollar for Berkshire Hathaway’s insurance policy. In fact, Quicken could emerge as one of the biggest corporate victors come tournament time.
Each March, companies amp up marketing efforts around the NCAA tournament in an attempt to increase brand recognition and drive revenues. Busiest among them are NCAA’s official Corporate Champions AT&T, Capital One and Coca-Cola, whose support helps fund 89 different championships and over 400,000 college student athletes nationwide.
Quicken Loans, on the other hand, is not an official NCAA corporate sponsor, thus their promotion isn’t benefiting anyone but themselves, along with a very unlikely new billionaire.
Performance Research studies tell us that modern fans are much more likely to favor a brand when that brand’s sponsorship of an event or campaign adds substantial value to the user-experience, regardless of its “official” status. In other words, if a promotion can engage consumers on a personal level it becomes considerably more effective. Thus this billion-dollar bracket contest offers the potential for huge returns for Quicken Loan.
Rather than cough up the dollars necessary to be dubbed an “official” sponsor, Quicken opted for this unconventional move. However, they will be garnering serious exposure from an event without supporting the organization responsible for putting it on. There are positive benefits to real people being bypassed by this agreement.
The Billion Dollar Bracket Challenge may ultimately be the best business decision for Quicken. We’re just not sure that it is the appropriate one.