Political candidates spend early, often on TV ads

By Georg Szalai

NEW YORK (Hollywood Reporter) - Political advertising spending in this presidential primary season is on a record track with TV stations in the early decision states benefiting the most.

With many primaries moved up and happening in quick succession this time, presidential candidates are spending more heavily than ever on key states in the early going, a group of experts said during a recent panel organized by the International Radio & Television Society Foundation.

That early spending spree, however, raises questions about how much money the candidates will have left and where they will put it down the line.

During the final week before the Iowa caucus on January 3, White House hopefuls poured about $1 million a day into advertising on the state's TV stations, said John Poor, vp marketing at the Television Bureau of Advertising. "That blew all past spending away," he later told The Hollywood Reporter. "It created havoc in the last seven days."

He also said it was shaping up to be "a furious (final) week in Michigan," which holds its primary Tuesday.

TV stations in Nevada and South Carolina, where the next decisions will come, also look set to get unprecedented amounts of primary advertising, Poor said.

After that, he expects many of the candidates that are left standing to catch a breath ahead of Super Tuesday on February 5, when primaries take place in 23 states. They will have to decide in which states they have a real chance and, as a result, where to put their remaining financial resources.

By Super Tuesday, 65% of primary delegates will be decided, opening up a new advertising opportunity never before used by a presidential hopeful, said Bob Marra, general sales manager at WPIX-TV/CW11 New York.

"This is the first time candidates had a chance to (advertise) on the Super Bowl," he said. "I'd tip my hat to that candidate" that bought a spot there.

Of course, most ad spots for the February 3 sports extravaganza have long been sold out.

Friday's panel suggested that a much-cited estimate of $3 billion in overall political spending this year might prove somewhat overly optimistic.

"Last time, you had more competitive governors' races," said Julio Marenghi, president of sales of the CBS Station Group. Plus, he said the big wave of early primaries might affect later spending. "I'm not sure moving the primaries up helps us really," he said.

Poor signaled that the expected letup of activity after the early primary spending frenzy coupled with a general election campaign following more traditional patterns also might keep total spending below the $3 billion mark.

TNS Media Intelligence, among others, has mentioned this mark as an estimate. It compares with the research firm's $2.3 billion political spending figure for 2006 and $1.7 billion in 2004. All figures include money spent on issue-advocacy ads.

Market watchers have said CBS Corp.'s TV stations will be among the big winners this election season.

CBS Corp. president and CEO Leslie Moonves last week said he is targeting for his company to get about 10% of overall political spending this year.

The fact that Democratic presidential hopefuls are locked in a tough battle is "a phenomenal situation" for TV station owners in big markets, he said.

New York has traditionally not been a big beneficiary of political ad spending in presidential election years, but some on the panel expressed hope that this will change this year.

"New York has never been a factor in a presidential campaign," Marra said. "This is our first opportunity."

If New York Mayor Michael Bloomberg enters the presidential race as an independent by early March, as many expect, that could boost spending here.

For Marra, "the perfect storm" for New York would be to have three presidential candidates with a local background -- Hillary Clinton, Rudy Giuliani and Bloomberg.

That said, TV stations in New York have yet to see some political action. "Nobody spent a dime in New York so far," Poor said. He also cautioned that the state's stations in a close election could never see much money flow in. "That would go into swing states in the heartland, not New York," he said.

Meanwhile, radio ad executives also have been bullish on radio's ability to draw big political money this election season.

"We see far more targeted ads" coming to the medium, said Genelle Niblack, vp and director of political sales and strategy at Katz Media Group.

She later told The Hollywood Reporter that radio's share of political ad spending this year could come in closer to 10% after about 8.2% in 2006 and 6%-7% in 2004.

Reuters/Hollywood Reporter