This post was originally published on April 20, 2020, and was updated with new data on September 30, 2020.
It’s time to throw the political advertising playbook from the last election cycle out the window. With the continued rise of over-the-top (OTT) and digital video, plus the impact of coronavirus on consumer habits, tactics that were successful in 2016 just aren’t effective this year.
For starters, the OTT and connected TV (CTV) opportunity has been amplified even further due to the pandemic and shifting viewer habits, and political advertisers simply cannot ignore it. In fact, we’ve seen a 900% increase in political advertising spend across OTT and CTV channels on the SpotX platform in September as compared to April 2020.
Let’s take a closer look at the top trends we’re seeing so far this election season.
Top trends for political buyers to monitor
1. OTT and CTV will play a major role in political advertising
More US households are tuning into CTV, following a shift in consumer behavior since the last presidential election in 2016. This means there’s a growing number of people who are no longer reachable through linear TV. However, voter participation among these cord-never and cord-cutter populations is increasing. More marketers are following the growing viewership, putting more ad dollars toward OTT and digital video than in past years as they look at opportunities outside of linear TV.
2. Scale and availability still concern advertisers, especially with regards to geo-targeted OTT
In the 2020 presidential and down-ballot elections, candidates will be fighting for impressions due to the number of candidates running and with other advertisers not wanting their messages to be overshadowed by political messages. All of the smaller races will also be a boon for local TV markets, though once local TV inventory has been reserved, the local candidates will revert to OTT and geo-targeting campaigns at a congressional level.
Political buyers can scale advertising with growing inventory across OTT and CTV, which has increased by nearly 75% on the SpotX platform in September as compared to April 2020.
MAGNA reports that OTT video accounts for 12% of a user’s time spent with media, yet only receives 3% of total ad spend. There is a window of opportunity for political advertisers to access their target audience on CTV/OTT while demand is still trailing viewership, but it won’t last long.
As more begin to capitalize on this opportunity, advertisers will increasingly look to reserve CTV inventory or set up 1:1 publisher deals, not only ensuring availability during the inventory crunch through October, but also limiting access to their competition. We’ve seen only slightly higher rates for political ads from some supply partners thus far, but rates will increase as competition for ad space grows over the coming months. So, lock in your campaigns as soon as you can.
3. Enhanced first- and third-party data targeting is driving CTV adoption
Political persuasion has relied on first-party targeting for years. The new data and targeting abilities on OTT will advance that targeting, as there is a demand for quick turnaround and accurate first-party data matching.
In addition, aggregated political data from a variety of partners can help candidates move beyond affiliation and demographics to answer behavior and psychological effects, such as feelings about schools, taxes, welfare, social security, etc. We have created a political data group by partnering with data companies from both sides of the aisle including Data Trust, i360, L2, TargetSmart, Tru Optik, and others. Media buyers can deploy voter segments with precision, using the most up-to-date data, across all screens and streams.
4. Brand safety will deserve increased focus
Political advertisers must monitor impression quality and invalid traffic, as well as apps infringing on copyrighted material or posting unsafe content. Regarding brand safety in CTV and OTT specifically, areas of note include device and app spoofing, un-authorized inventory, upticks in non-human traffic, and ghost apps.
Marketers have also shifted how they address news content, with many seeing the value in leveraging certain areas of news media rather than avoiding it across the board. SpotX’s ability to categorize video advertisements will allow advertisers to navigate ad placements at a detailed level across the web.
5. Advertisers will look beyond social for their campaigns
Facebook is accused of misusing data around political ads and influencing the 2016 US presidential election, and Twitter has banned political ads. While social platforms will continue to be important, we’re seeing more advertisers become hesitant to use social for their campaigns. As they move away from heavy spend on social and evaluate different strategies, they’re realizing the impact that OTT can have on their campaigns.
6. Regulations will have long-term implications on political campaigns
Privacy and data regulations have monopolized conversation following the rollout of GDPR and CCPA, along with backlash against Facebook and its data scandals. There’s a growing effort to more strictly regulate political data collection, usage, and consent. This likely won’t impact the 2020 cycle, but looking ahead to the 2022 midterms, the political buying world should be prepared and educated on the best ways to pinpoint their audience as the data landscape shifts.
TV and radio have been heavily regulated with regards to political advertising since the 1930s and 1940s (e.g. the equal-time rule, FCC reporting, lowest unit rates, etc.), but the digital world has enjoyed some leeway. That will be coming to an end, so be prepared to address these potential changes in the coming cycles.
How retail and other non-political buyers will be affected
Non-political advertisers will have to adjust their strategies leading up to the 2020 election to ensure they are breaking through the noise of the many politically charged buys.
The cost per points (CPP), the measure by which linear TV buyers negotiate and place spot TV, has been rising quickly due to increased political demand. In battleground states and DMAs, the increase in rates have been even more pronounced. Additionally, advertisers that thought they were safe from preemptions are finding portions of their buys are being bumped, requiring them to take makegoods. As the available local TV supply tightens the availability of suitable makegoods will become limited.
For retail or other advertisers that must deliver against communication or target rating point (TRP) goals each month, the constraints create a unique dilemma, and again demonstrates that CTV will become a sought-after and efficient alternative.
What political buyers can do to get ahead
Political advertisers should speak with their political consultants, existing DMP partners, and any media owners they currently work with that offer TV and OTT inventory to gauge what they are seeing coming down the road. Organizing and activating your first-party data early on will give you an advantage.
Plan to diversify your media mix early in preparation for the crunch time of the 2020 cycle. Doing so will help you be prepared to deploy candidate and issue budgets into various mediums where scale and audience will live versus scrambling at the 11th hour to redistribute budgets.
Advertisers can glean great insights from the detailed level of reporting OTT and OLV can provide, so be sure to act on them quickly. Efficient creative approval is paramount, so choose to with partners that allow for fast implementation of creative and campaign changes.
Viewers easily switch between screens to view content, especially in the current stay-at-home period, so be sure to manage frequency across platforms.
Finally, stay up to speed on all regulations and legislation with respect to political advertising, especially after the 2020 elections. Don’t let your guard down because it has quieted down a bit.
You can read more about how SpotX manages political ads here.
About the author
Kyle Benn is VP of Mid-Market, Demand Facilitation at SpotX, leading the North American mid-market sales team and tasked with driving national agency and client-direct revenue. With more than a decade of experience in digital advertising, Kyle focuses on programmatic direct, private marketplaces, and managed services to help media agencies and brand marketers understand the value of video ads.