You will be redirected back to your article in seconds

Despite Trump Effect, Political Ad Spending May Not Be What Networks, Stations Expect

Donald Trump’s candidacy has been a ratings godsend. What’s still uncertain is whether it will boost or deflate political ad spending through the rest of the year.

The U.S. political cycle drives two spikes in advertising every four years: a large one during presidential campaigns and a smaller but still significant bump in even-numbered years that have congressional elections. These peaks in spending are enough to drive more than a quarter of total ad revenue during election years for some owners of broadcast stations, which get the lion’s share of political ad expenditures.

With a lame-duck president and long primary races on both sides, this year’s race has had the potential to drive massive ad spending as campaigns have heated up and stayed hot. The 2016 race has already generated substantially more revenue for station owners than the Obama-Romney campaign did four years ago. Four station owners — Nexstar, Meredith, EW Scripps, and Sinclair — minted $103 million from political ads from Q1 2015 through Q1 2016; the figure during the corresponding period for the earlier campaign was just $38 million. Moreover, the lengthy battle between Hillary Clinton and Bernie Sanders likely boosted spending at least a bit during Q2.

The bigger question is whether we’ll see any pivot in Trump’s ad-spending strategy from the primary to the general election. He has spent a fraction of the amount laid out by either of his Democratic opponents and several of his erstwhile competitors for the Republican nomination. The conventional wisdom suggests that the free airtime he attracts as a result of his controversial remarks is bad news for ad spend.

When Trump does spend on traditional advertising, he does so in a more targeted way than his opponents, with the intention of influencing key groups of voters in specific geographic areas. Given the rise in addressable advertising technology, it’s likely we’ll see candidates opt for more of this surgical spending, rather than blanket advertising, as we approach the general election.

There still may be a bump in spending from congressional candidates on the Republican side, concerned that voters lukewarm on Trump may not turn out at all. Also in play are super PACs, which could add meaningfully to a mix that already includes direct spending from candidates and their parties.

Overall, the TV industry appears to be banking on record spending throughout the rest of the election, but there seems to be plenty of cause for caution on that front. We may yet see a disappointing haul for station and network owners.

Jan Dawson is the founder and chief analyst at Jackdaw Research, an advisory firm for the consumer technology market.

More Voices

  • Contract Placeholder Business

    WGA, Agents Face Tough Issues on New Franchise Pact (Column)

    The Writers Guild of America and the major talent agencies are seven weeks away from a deadline that could force film and TV writers to choose between their agents and their union. This is a battle that has been brewing for a year but few in the industry saw coming until a few weeks ago. [...]

  • FX Confronts Streaming Thanks to Disney

    Kicking and Screaming, FX Is Forced to Confront Future in the Stream (Column)

    During his network’s presentation at the winter Television Critics Assn. press tour, FX chief John Landgraf made waves — and headlines — by mounting perhaps his most direct criticism yet of Netflix. Landgraf, whose briefings to the press tend to rely heavily on data about the volume of shows with which FX’s competitors flood the [...]

  • Longtime TV Editor Recalls Working for

    How a Bad Director Can Spoil the Show (Guest Column)

    I have been blessed with editing some of TV’s greatest shows, working with some of the industry’s greatest minds. “The Wonder Years,” “Arrested Development,” “The Office,” “Scrubs,” “Pushing Daisies” and, most recently, “A Series of Unfortunate Events.” I have earned an Emmy, ACE Eddie Awards, and many nominations. But whatever kudos I’ve received, over my [...]

  • Stock market Stock buyback

    Stock Buybacks Leave Firms Without Funds to Invest in Future (Column)

    Corporate giants on the S&P 500 have spent more than $720 billion during the past year on stock buybacks. Media and entertainment firms account for only a fraction of that spending, but even $1 million spent on share repurchases seems a foolhardy expenditure at this transformational moment for the industry. The record level of spending [...]

  • Hollywood Has Come Far With Diversity

    An Insider's Look at Hollywood's Diversity Efforts and How Far It Still Needs to Go

    I am a white man working in Hollywood. I grew up in Beverlywood, an all-white, predominantly Jewish, Los Angeles neighborhood sandwiched between 20th Century Fox Studios and MGM, where my elementary school had only one black student. I am compelled to write about diversity in Hollywood because “diversity” — in front of and behind the camera [...]

  • Venice Film Festival A Star is

    How Venice, Toronto and Telluride Festivals Stole Cannes' Luster (Column)

    In all the years I’ve been attending film festivals, I have never seen a lineup that looked as good on paper as Venice’s did this fall, boasting new films by Alfonso Cuarón (“Roma”), Damien Chazelle (“First Man”), Paul Greengrass (“22 July”), Mike Leigh (“Peterloo”) and the Coen brothers (“The Ballad of Buster Scruggs”) in competition, [...]

More From Our Brands

Access exclusive content