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Thursday, September 4, 2014

Spot TV And The 2014 Elections

The past few months have not been kind to most forms of television advertising. Even the fabled “upfront” market in network TV was weaker this time around with some clients switching to more digital options with video online ads and others simply holding back money to allocate at the last moment.

The local TV market has been interesting. There are some parts of the country that are doing just fine. The energy boom in the plains states and stretching down to Texas has insulated them from the soft marketplace and a few pockets in the Southeast have done nicely as well. Many markets (Nielsen DMA’s) are down double digits from last year and station managers and sales executives scoff when they hear signs that the economy is recovering slowly but surely.

Well, some markets are about to get a much needed shot in the arm. Between now and election day on November 4th, some $2 billion dollars is about to be injected into local marketplaces for Senate and House of Representatives races alone. The problem with that is that the money will not be spread out evenly.

Only 35-40 of the House seats are really strongly competitive races so the impact of heavy spending will not be felt nationally. The U.S. Senate, which could conceivably return to the Republicans, are the races where the big bucks are being spent. Right now, the Democrats have a precarious hold on five seats that could go either way in two months. They are in Alaska, Colorado, Arkansas, Louisiana, and North Carolina. Should the GOP run the table on those five races, they would almost certainly take back the U.S. Senate. Even Mitch McConnell, minority leader from Kentucky, faces a stiff reelection bid in the Bluegrass State.

Here are a few verbatim comments that I received from broadcasters across the country:

-- “Business stinks right now. We do not even have a Senate seat up this year so our political billing will be modest. Station ownership is putting real pressure on me. There is little that I can do until confidence returns.”

-- “I am way down for the year but I do have a juicy battleground Senate race. That will bail me out for the fourth quarter. Years ago, we considered political advertising a royal pain. Now, I admit I pray for it every other year.”

-- “Okay, so I will finish the year fine due to a hot Senate race with record-breaking  spending and a reasonably tight Governor’s race. What do I do in the first quarter, 2015?”

-- “My station group told me to get political money. We are a one party state. I do not remember the last competitive race that we have had. The sure winners only spend token amounts and they are doing more on the internet this year.  Only a miracle will save me for this year.”

Looking ahead two years, campaign strategists with, by then, ever more improved targeting techniques will probably continue to cut back on TV usage. And fundamentally, more advertisers are pulling back on TV in general shifting to online options, which are often video, but not conventional or even local cable TV.

Things are changing. The biannual political bailout for local TV stations seems set for an irreversible decline.

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

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