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Thursday, January 16, 2014

Changes in Political Advertising

Last week I spoke with and e-mailed back and forth with a broadcaster about prospects for 2014 advertising. He was, at best, guardedly optimistic but did say that he had a hot U.S. Senate race in his state that should bail him out if the economy did not continue to crawl upwards. Then, he said that political spending on his TV station would probably allow him to meet sales quotas for 2014 but definitely not for the rest of his career. We talked at length about the way political advertising is changing and I then spoke or e-mailed with a dozen other people who NEED political spending, some very badly.

To a person, everyone agreed that the game was changing and fast. One graybeard asked me if I remembered when candidate or PAC (Political Action Committee) spending was considered to be a pain in the derriere? Often a junior salesperson had to handle it and, due to rules that required candidates to get the lowest rates on the station, it was not considered a very lucrative part of the station’s income. You would have to “bump” conventional advertisers to make way for the political spenders and sometimes the politicians paid significantly less than your local account.  As the economy has softened and political money continues to break records with each election, all that has changed. Political spending can make a TV station’s year in competitive states.

Additionally, the cable people can sell zoned messages which allows a candidate to run unique campaign messages in vastly different demographic areas within a congressional district by sending separate messages by county or a cluster of zip codes. There is far less waste than running on over the air TV where you often reach thousands living in an adjacent state.

The big changes lie ahead in two areas:

A Four Screen Campaign

1) Microtargeting is not really new--it is new in that it is not that well known outside of direct marketing. Simplistically, it is a cluster analysis which is datamining techniques that involve predictive market segmentation. Some say Microtargeting in politics was first used as early as 1992 but it was initially employed on a national basis by the famous Karl Rove in more than 15 states in George W. Bush’s 2004 reelection effort. The research identified likely Bush voters and the campaign was able to reach more than 90% of them.

    Both national parties have very large and sophisticated databases that track voter habits not unlike what American Express or Mastercard do for consumer spending habits. The databases know a great deal about you--do you have a party affiliation, do you always vote, do you ever contribute to campaigns and how much, and whether or not you have ever volunteered in an election campaign. Armed with these data, volunteers can visit likely prospects and help get the vote out. Direct mail and e-mails are customized to these prospects and often the tailored message is aiming at a small, sometimes very small, segment of the voting public. This can be very positive for ad agencies as they may get to produce a large number of commercials, or mailings on a wide variety of topics.

2) Four Screen Campaign--this is already underway but we should see a lot more of it in  2014. The four screens of TV, PC, Tablet, and Smartphone will be used by many more candidates this year than ever before. Most people see the Smartphone as being the biggest gainer on a percentage basis. It may be a way for politicians to reach the elusive and light voting young adults. One campaign manager whom I met online through a friend is going to use Vine, the six-second video alternative from Twitter. He said, “My candidate is a good guy who does not make verbal gaffes. But, he is not a high energy candidate. So we are going to tape dozens of six-second videos and put them on Vine. As we near the end of the campaign, if our segmentation is good, we will have dozens of customized messages out there. He can make a few campaign appearances a day but Vine will make us look as if there is always a flurry of activity. We can also pick off some young voters than we need, really need.”

Forward thinking cable players are getting things in place to insert on all four screens. By 2016, this could be the norm in major races. Separately, Hulu and YouTube should see nice increases as well.

So, is TV and Cable political advertising dead? Not by a long shot. Both parties are now deep into 21st century technology (the Democrats outflanked the GOP in 2012) so spending may be up this year but TV and Cable’s share of the huge political pie is likely to decline. In 2012, friends in battleground states such as Wisconsin and Ohio said they were afraid to turn on their TV sets given the barrage of TV messages. One said he went to Turner Classic Movies and Public Television far more than usual just to escape the politicians. Several years from now, you may hesitate before you fire up your tablet or Smartphone.

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com

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