Is 2018 shaping up to be a banner year for political advertising? That’s the good word from Steve Passwaiter, the VP/GM, Political at Kantar Media.
In an essay appearing Friday (9/22) at The Cook Political Report, Passwaiter declares, “Even though the last two years have seen lots of bungled predictions, in the realm of TV ad spending, we are undeterred, and predict that TV will win out in 2018 as well.”
Passwaiter opens his column by noting that, even in this digital age, “Most money raised in politics is spent on advertising, and … most of those advertising dollars still go to the long-time king of political advertising: television.”
In 2014, the most recent midterm election, the total TV ad spend was $2.8 billion.
Passwaiter comments, “It’s tempting to add a few percent to that to account for inflation and call it a day. But that’s far too blunt an instrument; the number and location of competitive contests influences the amount of money campaigns spend in any given year.”
He also notes that there have been changes in the last two elections cycles in the ways campaigns allocate their television advertising dollars.
To get the full picture, Kantar’s Campaign Media Analysis Group (CMAG) asked the following questions:
- How much money is likely to be raised overall? How much might be spent on advertising in general?
- What proportion of that money might go to TV? What proportion of TV money to local broadcast, local cable and satellite, national cable, and national broadcast, respectively? Where will it be spent?
- There is lots of fundraising energy and enthusiasm on the Democratic side—but how many seats could actually be in play?
There are 42 House seats in play, and 12 of them are rated by Cook as “toss-ups.”
Meanwhile, 9 Senate seats in play, with four of them toss-ups.
“This is similar to Cook ratings at this point in the 2014 and 2016 cycles, but fewer races than were considered competitive at this point in the 2012 cycle,” Passwaiter says.
A look back at the last four electoral cycles shows that television advertising spending in House contests attracts about 20% of all TV ad dollars. Kantar expects this proportion to stay about the same.
But, should another competitive House race emerge, dollars could surge.
In contrast, the Senate was heavily targeted in 2016, and Kantar saw a huge jump over 2014 ad spending. “There were only 11 competitive Senate races (five fewer in play than in 2014) and the races were not in big expensive markets, but we still saw a 50-percent spike in ad spending,” Passwaiter notes.
But, Kantar/CMAG is paying particular attention to governors’ races. The Cook Political Report rates 17 states in play, and 12 as toss-ups or worse. That’s four more than at a comparable point in 2014 cycle. Many of these competitive races are in big states with expensive media markets: Illinois, Florida, Pennsylvania, and Ohio.
Down-ballot candidates and “hot button” issues will also fuel political ad dollars in 2018, Passwaiter says.
“In the states, and among national committees, there is energetic fundraising going toward state legislative races,” he says. “Why? The clock is ticking, and the stakes are high: State legislators elected in 2018 will be the ones drawing new districts in 2021, which will shape the trajectory of politics for the next decade and beyond.”
DACA, tax reform, and health care could also draw national and locally targeted ad dollars, Passwaiter says.
BROADCAST VS. CABLE ALLOCATION
The share spent on local cable (ads seen on cable stations only on particular systems or in particular markets) has steadily increased over the last few cycles, Passwaiter notes.
“While estimates vary, and depend on the race, local cable probably captured about 25 percent of local ad spending in 2016. We expect that number to continue to creep up.”
In the current Virginia governor’s race, for example, nearly 30% of TV ad spending has been on local cable. “The cable share could be even higher than that in House and down-ballot races, as was the case in the special election in Georgia’s 6th congressional district, where cable-system targeting allowed more efficient spend in the pricey Atlanta media market,” Passwaiter says.
Thus, Kantar/CMAG’s projection is for $2.4 billion for local broadcast and $850 million for local cable.
Passwaiter notes, “Whether that number is higher or lower will depend in large part on the number of competitive House races (and when they become competitive), the outcome of gubernatorial primaries, how many initiatives wind up on ballots across the country, and the issues Congress chooses to take up. And, of course, those pesky unforeseen circumstances.”
For the first time, CMAG will also forecast digital ad spending.
The estimated total for digital in 2016 was between $600-$700 million. For 2018, we project a spend total of $600 million driven mostly by advertising done on Facebook, despite recent headlines.
