Political advertising spending soars for US mid-terms

High-stakes races, polarised voters and online fundraising are projected to push spending to nearly $US9.7bn, report says.

A top advertising industry observer projects political ad spending during the current two-year election cycle will more than double as compared with the 2018 mid-terms and even exceed that spent in 2020 when the White House was in play.

AdImpact says in a report that total spending is on pace to reach close to $US9.7bn ($13.7bn). That compares with about $US4bn in the 2018 cycle and about $US9bn in the 2020 cycle, it said.

The figures include spending on broadcast, cable, satellite and streaming, as well as on radio and online. They include races for congress, governorships and other down-ballot contests and aren’t inflation-adjusted.

“An increasingly polarised electorate and easily accessible online fundraising tools have been major factors propelling this surge in spending,” the report says. “It no longer takes a presidential ticket at the top of the ballot to push a cycle near the $US10bn threshold.”

Online fundraising platforms such as ActBlue for Democrats and WinRed for Republicans have helped candidates and issue groups tap into a growing number of small-dollar donors that are helping fuel increased campaign spending.

“We continue to see more dollars coming into the system,” said Kyle Roberts, AdImpact’s chief executive.

Mid-term elections are typically less costly than those that include presidential races, so this cycle’s heavier spending is a boost to broadcasters and others. The increase comes as overall ad spending is showing signs of a slowdown amid signals that rising inflation is starting to weaken consumer spending.

So far this cycle, AdImpact says roughly $US5bn in ads have already run or are booked to do so between now and the November 8 election. A campaign’s final three months typically account for about two-thirds of total spending, and many expected ad buys haven’t been placed yet.

A growing number of political ads are appearing on TV screens connected to the internet by streaming-video players such as those made by Roku. Campaigns are increasingly gravitating to the streaming platforms because ad placement there is more financially efficient than traditional broadcast TV, with voter groups and geographic areas more easily targeted.

AdImpact says so-called connected television or CTV represents about 13 per cent of the overall political spending and the firm estimates total spending on such platforms will grow to $US1.4bn by November.

Even with the growth of digital advertising, broadcast TV remains the dominant platform for political ads. AdImpact projects more than half of the spending for this cycle will be placed on local TV stations. AdImpact predicts almost $US4.3bn will be spent on house and Senate races, while $US2.4bn will go to campaigns for governor. A further $US3bn is expected to be spent on other down-ballot races.

The surge reflects the high stakes faced by both parties and special interests trying to influence the first midterm election of Democrat Joe Biden’s presidency. Republicans will be able to pare down his agenda if they can win control of at least one chamber of congress.

The Wall Street Journal