Campaign Spending 2008 - The Implications for Local TV Broadcasters

In articles that ran on September 25 and October 2, 2007 TVNewsday [1] Editor Harry A. Jessell interviews TNS Media Intelligence's [2] Evan Tracey about 2008 political campaign spending. TVNewsday reports that candidates and their backers could drive political ad spending to record levels, perhaps $3 billion.  What will this mean for local TV stations, who will be on the receiving end of much of this spending? Other media, including cable and the Internet, are seeking a share of this windfall as well - how likely are they to get it?

The September 25 article is entitled "The Who, What and How Much of Campaign 2008" and can be found here [3].  It deals with the potential amounts of spending involved and the dynamics of political races that could impact those amounts.

The October 2 article is entitled "Local Cable Aims for More Political Dollars" and can be found here [4].  It discusses the relationships between political campaigns and various media.

NOTE: Registration (free) required to access these articles on the TVNewsday website.

Excerpts from Jessell's interview with Tracey:

At TVB, you said that you expected political spending to be at a minimum between $2.4 billion and $2.6 billion in 2008. Break that down for me.

Sure. Right now, I would say that you’re probably looking at close to $800 million directly attributable to the presidential campaigns. You’re probably looking at a number in the $300 million range for the Senate campaigns, probably a little higher than that for House campaigns. Ballot measures are likely to be in the $200-million-to-$300-million range. Judges again could total another $100 million. The rest is going to be tied up in state and local races—everything from governor down to dogcatcher.

Are we talking only 2008?

Most of that’s going to be ’08, but some of it will start in third and fourth quarter of ’07.

How much political spending will there be in 2007?

If you factor in issue ad spending, it’s going to be somewhere in the $700 million dollar range. On Labor Day we were at about $50 million spent on campaigns this year. Usually, about 20 percent of the total is spent before Labor Day.

How much of a candidate’s money goes into TV these days?

It’s not one percentage because every race in every state is different. In a presidential race, probably close to 50% or 55% of the money that gets raised goes into some form of paid media. On a congressional level, again, it depends a lot on the state and what media markets the candidates are in. So it’s really hard to sit here and give you an apples-to-apples comparison.

Some states are all media. A statewide race in California is going to be all media, but a race in Fresno is going to be more person-to-person contact. There will be more radio in a place like New York. Like I said, there’s no one formula number, but it is generally the largest line item in any campaign budget.

Are TV news and news adjacencies still the places every candidate wants his ads to run?

Yes. Political campaigns love to buy the news. That’s sort of what they buy first with the idea being that, if you watch the news, you’re more likely to be interested in politics and be a likely voter. Demographically, any sort of news programming fits political buying.

One of the broadcasters’ problems is that they don’t have enough news to fill this demand. What advice do you have for them?

In states where there’s a lot of inventory pressure, a lot of times the stations will actually limit the number of spots that they’ll sell candidates in the news. They might say they’re only going to sell one spot an hour to each candidate so they don’t get everybody in there and turn their local news into a bunch of political spots.

Where there is inventory pressure, the dollars will get spread out across the dayparts. The candidates need the time. They’ll take what they can get in the news, but they’ll also take what they can get, period.

What’s the Internet role in political campaigning today?

I still think the Internet is by and large being used as more of a convenience type of resource for the campaigns, certainly on the national level.

They’re producing more Internet videos to put on their Web sites and You Tube. They’re using banner ads as a way to fund raise, but I don’t think anybody’s really figured out how to make the Internet into a messaging tool.

There are a lot of things that you can do with the Internet that don’t cost you any money. You can produce a Web video, put it on YouTube and promote it through your regular television commercials as [Republican presidential candidate] Fred Thompson did with his announcement. He did a television commercial to point people to the Web site to see his long form Web video. So I think that’s more the model.

Right now, campaigns are touting their blogs, they’re touting their sections on YouTube, they’re touting the fact that you can download a ring tone with their campaign message.

They’re using search more as a defensive measure. They’re trying to buy up all their key words so if you type “Rudy” into Yahoo, you don’t get taken to the Romney site. They’re using search and those kinds of things as a way to protect their brands from being hijacked.

But, in so far as advertising goes, you may see some banners designed to promote events at the local level. They can buy ads on blogs that are not very expensive and easy to produce. But you don’t see a whole lot of candidates out there trying to do a ton of messaging with the Web right now. Nobody’s really gotten their arms around how to move the needle with the Internet yet.

So in terms of money, not a big deal yet?

Web advertising will see significantly more dollars than it has in the past, but it will probably be nothing more than a rounding error compared to what TV sees.

Do you see any medium cutting into TV’s share of the pie?

In many cases, the broadcast buys will come first and after that it will start to find its way into sort of whatever’s left. Cable is not an afterthought anymore. It’s now in the consultants’ media plans.

Radio has been used tactically in the past. If you want to fire up the Republican base, you buy radio ads on Rush Limbaugh or whatever the local Christian station is.

In 2004, we saw more of talk radio being purchased by the campaigns as a way to extend their TV buys. The Bush folks, for example, did a very good job of taking the same message that they used in their television ads and converting those to radio ads for morning and afternoon drive times to try to bracket a lot of Republican voters.

 [top]