Even before ballots are counted from Tuesday’s elections, some clear winners have emerged, as Google and Facebook reap windfalls from political advertising after a season of controversy over online political speech.
Political ad spending is on course to set a record, exceeding expenditures in the 2016 presidential election year, with a total of perhaps $9bn. Political ad buyers weren’t deterred by months of furor over election meddling by Russians using Facebook, Twitter and Alphabet's Google and YouTube.
“This was a test year for political digital,” said Kip Cassino, who works with research firm Borrell Associates after retiring as its executive vice president. “What they wanted to see was how many ads could they put on digital without people getting really upset.”
Digital ad spending rose more than 25-fold from the last non-presidential national elections in 2014, reaching 20% of expected political spending this year at almost $1.8bn, according to estimates compiled by Borrell. Kantar Media/CMAG, which omits some online activity, estimated 2018 online spending at $900m, up from $250m four years ago.
The figures show how digital sites, with their ability to target thin slices of the electorate, have assumed a prime place alongside traditional media such as broadcast TV, which is still prized for reaching large numbers of older voters likely to go to the polls and accounts for the largest amount of political ad spending.
Kantar estimated providers such as Tegna and Sinclair Broadcast Group would see political ad revenue rise to $2.7bn, up 30% compared with 2014. When local races are included, broadcast stations saw a decline in political advertising compared with 2014, to $3.5bn, but remain the top recipient, according to Borrell’s estimates.
Local cable TV advertising sold by the likes of Comcast or Charter Communications was expected to jump 75% compared with four years ago, Kantar said.
“Everybody killed it this year,” said Steven Passwaiter, a vice president with Kantar, which monitors political ads.
On Tuesday, Gray Television, which owns more than 100 local broadcast TV stations in smaller markets such as Augusta, Georgia and Omaha, Nebraska, said third-quarter political ad revenue was up 17% compared with the same quarter in 2014. That included a windfall four years ago from a hotly-contested senate race in Alaska, executives said.
“Political advertising remains quite alive and exceptionally healthy,” Gray CEO Hilton Howell said on an earnings call. Gray executives said political ad spending exceeded their expectations in states like Tennessee, Kansas and Florida.
Texas Democrat Beto O’Rourke was the biggest political spender on Facebook, placing $7m in ads, according to a tally presented online by the social media giant. President Donald Trump’s Make America Great Again Committee was the No. 2 spender, at $3.4m, and the Trump presidential campaign spent an additional $2.6m, according to the page.
Facebook said it has reaped $354m from more than 2 million ads. Google alone took in about $74.7m on ads that mentioned federal candidates or incumbents since the end of May 2018, the search giant said in its election transparency report. That doesn’t count ads that don’t mention federal candidates and politicians.
Facebook, Twitter and Google have all worked to increase the transparency of their political advertising systems this year, offering public archives. The companies are reacting before governments regulate following Russian use of online ads to target US voters ahead of the 2016 election.
Facebook in the spring briefly considered getting rid of political ads entirely, given how much of a headache they had become, people familiar with the matter said at the time.
CBS last week told investors that political spending at its TV stations is up more than 25% compared with the 2014 midterm elections.
A competitive Senate race in New Jersey helped boost spending in the expensive Philadelphia and New York markets, and the Illinois governor’s race elicited heavy spending on Chicago TV, Kantar’s Passwaiter said.
“It’s easy to get the fare meter spinning when you get the big markets involved,” he said.
Cassino said there may no longer be such a thing as an off year without political advertising.
“Tomorrow the 2020 campaign begins,” Cassino said. “It’s turned into an industry now, and you’re going to see political ads always.”