Article

Navigating The 2024 Election (Advertising Edition)

Advertising Analytics Consumer Behavior Data Economic Analysis Marketing

October 7, 2024

Since writing Issue #77 (BFCM Strategy in the 2024 Macro Environment), well over a dozen people – from CMOs to media buyers – have called, emailed and texted, all with the same question: how do we manage our advertising through the maelstrom also known as the 2024 election season?

Before diving into what you can do, I want to first provide some context, directly from Issue #77:

“Whether or not we like it, the simple reality is that this election season will be the most expensive in history, with an estimated $12.5B+ (source) spent on the Presidential, plus another ~$10B on Congressional (Senate + Congress) races. For context: 2020’s total spending (Presidential + Congressional) was about$16.4B in today’s dollars. Obviously, not all of that will be online (there’s direct mail, TV, radio, etc.), and total US Ad Spending was ~$350B in 2023 (eMarketer) – so this ~$22.5B is only ~6.5% of that total. BUT – and this is the BIG BUT – the overwhelming majority of that spend will happen in the final two weeks of September, October + first week in November. The net-net: we’re projecting that digital CPMs will rise by 30% to 50% above 2023 levels.”

Before going further, I want to address a point I’ve heard from several “media experts” over the past few weeks: “There’s enough inventory nationally to absorb the political ad spending without major impacts to CPMs.”

Objectively, this is true IF spending was semi-uniformly distributed over both the election season and the nation. Neither of those things are true. Most spending will occur in just a few markets (more on that below), and spending will flood into (and leave) various markets as new data emerges and candidates/committees/parties make decisions on which races to support and which ones to concede. Bottom line: whether or not there’s enough national inventory is irrelevant; what’s relevant is whether (or not) there’s enough inventory in the geographic regions relevant to advertisers (which will depend on the advertiser!).

Before diving into the impacts, it’s also important to note the temporal realities of Q4 2024: a late-ish election (November 5th) that is exceedingly likely to be both razor-thin and hotly contested, an as-late-as-possible BFCM (November 29 for Black Friday; December 2 for Cyber Monday) and significant economic (consumer) and growth (brand) pressures. This will have the effect of forcing a LOT of brand advertisements into a relatively narrow 18-day window between November 10th and 28th. Is this directly related to the election? Yes (in a non-insane-election year, more brands would spread their investment across October + November to mitigate the impacts on ad costs).

Where Will The Impacts Be Greatest?

The good (or bad, depending on where you are) news is that the impacts of the 2024 election cycle will not be uniformly distributed; the impacts of political spending will be greatest in the most competitive House/Senate races, the seven “swing” states (plus Florida), and the critical/bellwether counties:

Most Competitive House Districts (Cook Political Report):

Most Competitive US Senate Races:

Ohio
Wisconsin
Michigan
Arizona
Montana
Pennsylvania
Nevada
Maryland
Florida
Texas

Presidential Swing States:

Pennsylvania (19% chance to be the tipping point state per 538)
Michigan (12% chance)
Wisconsin (8% chance)
Georgia (12% chance)
North Carolina (12% chance)
Arizona (7% chance)
Nevada (4% chance)
Florida (10% chance)

Critical/Bellwether Counties:

Clallam County (WA)* The last true “bellwether”
Wake County (NC)
Cobb County (GA)
Erie County (PA)
Montgomery County (PA)
Miami-Dade County (FL)
Kent County (MI)
Wayne County (MI)
Brown County (WI)
Waukesha County (WI)
Clark County (NV)
Maricopa County (AZ)
Douglas County (NE)
Northampton County (PA)
Chesapeake (VA)

Broadly speaking, there are three types of advertisers in the US:

The National/Global Advertisers – think P&G, Amazon, PepsiCo, Levi’s, TEMU, Toyota, GEICO, Target, etc. These brands have ample media budgets and due to both their buying power (for reserved buys) and sheer scale, will be the least impacted.
The Midsize & Regional Advertisers – The next tier down is composed of brands with significant, but not otherworldly, media budgets. If you’re spending anywhere from $10M/yr to $100M/yr, you’re probably in this bucket. Generally speaking, these are regional companies (local services, manufacturing, distribution, real estate, senior living, retail) or niche national brands (whether that’s service, CPG, FMCG, eCommerce, etc.). While these brands have some scale, they’re likely over indexing on a few channels (Meta, Google, Linear), which amplifies their risk.
The Smaller & Local Advertisers – If you’re under $10M/yr in ad spend OR are advertising only in a few local markets (think local service companies, eCommerce brands, etc.), you fall into this category. Brands in this category are most likely to be severely impacted OR mostly insulated from the election (depending on where you’re located).

As a general rule, the smaller and/or more concentrated a brand is on a particular channel/tactic, the higher the risk profile for election-related disruption.

Channel-Specific Impacts:

Advertiser size and location are two major factors in projecting the impacts of the election on your media plans; the third is your media mix. As with everything else, some channels/tactics will be more impacted than others. If you’re already in a “risk” zone due to your geographic location and/or size, you might consider shifting your media mix for Q4 to something less-risky.

1. Major Impact: Linear TV & Radio

Ground zero for the tidal wave of political ad dollars will be traditional, linear TV. While the popularity of linear has been in decline (along with its share of total ad budgets) for a decade, the simple reality is that linear viewership among older individuals (read: supervoters) remains high, despite steep declines among Gen Z, Gen A & Millennials.

According to Statista, linear TV viewership among those aged 55+ (the purple, light purple and yellow lines below) is nearly double that of Millennials (Grey/Red) and Gen Z (Grey/Dark Blue). Political advertisers are nothing if not pragmatic – and roughly 61% of the US electorate is over the age of 45 (source).

Local/regional brands in politically important areas that are reliant on linear TV (there aren’t many, but there are some) will find that inventory difficult to come by and prices (CPMs) well above normal.

2. Major Impact: CTV

If Linear TV is the old guard, CTV is quickly becoming the new force in town. About 45% (according to MediaRadar & eMarketer) of all digital political spending is going to CTV. Part of that is due to the explosion in popularity of these platforms since the pandemic, and part of this is due to the features + functionalities they provide advertisers (granular targeting, ability to overlay other data points, ability to reach niche local audiences that would be cost-prohibitive with linear).

The good news for CTV-heavy advertisers is that these same features drawing in the political dollars can also be used to protect your media budget: most platforms provide the ability to benchmark + monitor CPMs, CTRs, CVRs, Ad Recall, etc. rates by county/congressional district. Should you observe significant changes in specific geographic regions, those budgets can easily be shifted or reduced until costs and action rates return to normal.

3. Moderate-High Impact: Audio & Podcast

Radio ads have been a mainstay of political advertising strategy for as long as I can remember (which is back to 1996, when Clinton was running for re-election against Bob Dole) – and that hasn’t changed. As with Linear TV above, if you’re a local / regional business in a politically-contested area that does a lot of radio advertising – particularly radio advertising on stations that index older – you’re likely to see higher rates and scarer inventory.

The wild card for this election (along with 2026 / 2028) is podcasts. This will be the first presidential election in the podcast era where political ads are allowed on Spotify (the company suspended them in 2020). For context, in 2016 Spotify reported about 123M MAUs worldwide; today, that number is north of 625M – so the platform size has increased at least four-fold in the last 8 years. Put simply: podcasts are increasingly becoming a viable channel for political campaigns to reach specific constituencies in a relatively cost-effective manner, and 2024 will be the first Presidential election where we have reliable data on their potential.

4. Moderate Impact: Meta

Political advertising on Meta will look markedly different in 2024 than it has before. To start, the platform has announced that no new political or social issue ads will be permitted beginning on October 29th at 11:59 pm (PST) through election day (November 5th). Meta has further clarified that, in addition to not approving any new ads, “most” edits to existing ads will also be prohibited.

While that may not seem relevant to non-political advertisers, it is: virtually every campaign, issue group and super PAC will be uploading every possible ad to the platform in the week leading up to this cutoff, and Meta will likely be prioritizing resources toward reviewing and approving these ads. The practical impact of this for non-political advertisers is pretty straightforward: ad approvals during this time will be delayed at the exact moment when many brands are rolling out pre-BFCM deals.

In addition to the new ad moratorium, Meta has rolled out several other significant changes that will benefit advertisers, including:

Stopping the recommendation of political/social issue content to users, unless those users specifically seek out such content
Removed targeting based on “sensitive” topics such as political affiliation
Reduced the number of political posts & ads in the Facebook News Feed

The net-net of these changes is a positive one: brand safety should be greater and the user experience is likely to be better – both of which should increase ad inventory (better user experience = more time on site = more ad units available = lower costs per individual ad unit). This will help off-set what can only be described as a deluge of political ad spending on Meta during the next 4-5 weeks. Small & Mid-Size advertisers who are reliant on Meta should monitor both costs (CPM/CPC) and performance (CVR, CPA, ROAS) at a regional/county/congressional district level to identify anomalies before they tank your budget.

Aside – a note on TikTok: TikTok has invested about $2B into trust & safety over the last twelve months, including banning political ads, attempting to curb misinformation, and instituting verification features for advertisers/brands. While this may sound great (no political ads), the impact is likely to be more mixed: I expect a number of brands will shift funds from CTV/Meta to TikTok, which would result in higher-than-normal CPMs.

5. Minimal Impact: Retail Media

Retail & Commerce media (Amazon Ads, Walmart Ads, etc.) will not be directly impacted by election spending. However, increased costs on other platforms (Meta, Google) may push more advertisers into more retail media placements. More competition = higher cost.

The second consideration – particularly for retail media – is conversion rates. Amazon noted in their Q3 earnings that many consumers are more hesitant to spend than they have been in previous years. Particularly in the 7 days on either side of November 5th, brands focused on retail media should expect to see lower-than-usual conversion rates.

6. Minimal Impact: Paid Search

As with Retail Media, paid search + shopping will see very limited direct impacts from the election. Unlike retail media, there may be a few places where election-related keywords and content could leak into your account and increase spend:

PMAX Placements
Search Terms (esp. If you’re running broad match)
Display Placements / topics

None of these are likely to be major, but every dollar matters.

7. Very Minimal Impact: Other Paid Social

I’ll be blunt: most political campaigns aren’t venturing any further than Meta, Google, CTV. If you’re advertising on Pinterest, LinkedIn, Reddit, Quora, X, etc., it is exceedingly unlikely that you’ll see an impact UNLESS you’re a hyper-local advertiser in a district where a candidate is getting quite creative.

What Can You Do?

While I wish there was an “off” button for political ads (as I’m sure many of you do), there isn’t. The reality is that they are something we will have to contend with for the next 4-5 weeks. Fortunately, there are things we marketers can do to mitigate the impact of the 2024 election on our (or our client’s) business:

1. Adjust Forecasts, Budgets & Expectations

The combination of a vicious election, a late Thanksgiving and a December Cyber Monday means that YoY comparisons/forecasts are going to be difficult. Adjust your budgets/forecasts accordingly.

2. Ongoing Audience Research

This is a drum I beat frequently, but ongoing audience research is a superpower. If you start to see evidence that key audience segments are adjusting their behavior – for instance, spending less time on social media, or avoiding news sites – that’s a valuable insight that can be used to pivot your media strategy. Should you notice a trend like that, capitalize on it (and do so quickly) – smart, nimble advertisers will be able to capture some wonderful deals because they did their homework, spotted an opportunity, and were able to take advantage in short order.

Remember: elections are notorious for driving short-term behavioral changes; if you can spot them (again, look for changes in website usage, declines in traffic referred, declining click-through & conversion rates, changes in audience breakdown), you can capitalize on them. It’s a great idea to benchmark your audiences on SparkToro now (or, ideally, 3 weeks ago), then re-pull those audiences every week. Flag any changes you see, then determine how you can take advantage (whether it’s adding those placements/channels to your existing campaigns, spinning up new campaigns on platforms, etc.).

3. Non-Traditional Media Buys

With every other advertiser throwing globs of money at platforms, consider doing something non-traditional, like an event sponsorship, influencer collaboration, podcast sponsorship, etc. These private deals are insulated from the vicissitudes of the ad markets, and are more likely to be remembered during heavy-advertising periods.

4. Lean On Your 1P Data

I’m a massive proponent of leveraging as much of your 1P/0P data as possible to inform your ad buys. Make sure your customer lists are updated (and sync’d) to ad platforms daily (if not hourly); create suppression lists of bad leads/low-quality customers; create lookalikes of your best customers, specific types of buyers, users of specific products, etc.

If you want to take this one step further (particularly on Meta), you can create a LAL of your bad leads / spam leads – then exclude it. It turns out that a lot of spammers have similar behavioral patterns, and excluding a small (1% to 3%) LAL of existing garbage leads cuts down on the number of future garbage leads.

5. Pull Impact Reports

While I know every marketer’s eyes are about to roll, GA4 should be your best friend during this period. Create an exploration that benchmarks traffic by source + geographic region (yes, you can do that) to monitor changes in traffic quality.

On the ad platform side, Google allows you to pull a location report using Congressional Districts (super handy!); run a week-over-week and month-over-month report, then filter by the biggest changes. If you notice your costs surging in battleground states or competitive congressional districts, that is a strong signal that competitive pressures + political ad spending could be increasing your costs. Meta provides similar functionality, albeit at the state level (you can add congressional districts in Meta from a targeting standpoint, too).

6. Plan For the Slide

As I mentioned above, elections have a weird impact on short-term behavior – they don’t crush demand, but they do “slide” it forward. In the ~7 days around the 2024 election, we fully expect to see far lower conversion rates as the election (and surrounding coverage) sucks all of the proverbial oxygen from the room. However, when the election is over (and it will be over), all of the “to-dos” that users put off to focus on the election will come roaring back – resulting in a demand surge around the 12th to the 23rd of November. If your budgets aren’t prepared, you’ll likely find that you’re under-pacing at the beginning of November, but are then limited by budget in mid-late November. Make sure to plan for this slide and up your budgets before the demand surge hits.

7. Impulsive-ness

There’s going to be a lot of doom-strolling during this period, regardless of the outcome of the election. In the days around the election (and likely, the days after the election while vote counts are coming in and races are being called), there will be a LOT of people sitting around, watching TV, and on their phones. If you have a product that is relatively low-cost and an “impulse” buy, it is definitely worth getting more aggressive in your advertising during this period. While people will be reluctant to make major decisions during this time, an impulse purchase – especially one masquerading as a productive use of time (i.e. checking a gift off) is a different fox hunt altogether.

8. Be Opportunistic

I mentioned above that a number of “business decisions” will be made about campaigns and candidates in the coming weeks – and money will flow in and out of those campaigns as a result of those decisions. Some states/districts that were initially considered to be competitive will see their polling tank; some candidates will simply run away with their race and no longer need to advertise. When this happens, TV budgets (and radio, and CTV) will be pulled – leaving the actual ad networks in a lurch. Historically, those networks have turned to aggressive sales offers to move that inventory. If you have a client that is both flexible and has some budget, the single most impactful phone calls you can make are to the networks (local, regional, national) with high ad spending – just let them know what you’re looking for, where and when (for instance, “Hey Jack – nothing urgent, but I have a client in Baltimore that’s interested if you have some ads cancel this fall. Ideally they’re targeting [insert demo / channel (here’s where audience research is helpful!)], but we’re open if there’s a great deal to be had.”)

Yes, you’ll have to fend off a sales pitch – but hold firm. When some of those buys fall through (and there are ALWAYS reservations that aren’t fulfilled), you’ll be Jack’s first call. This is particularly true for local stations and/or smaller races – candidates run out of money, the check bounces, the race turns – and all of a sudden that station is staring at potentially hundreds of thousands or millions in open spots that need to be filled ASAP. These become relationship sales, and if you’ve laid the groundwork, you’ll get the call. In my career, I’ve been offered some insane deals because a candidate backed out and getting my $0.10 on the dollar was better than $0.00.

The other caveat here is that you need to be able to move incredibly quickly (like, an hour or two) and you need to have assets ready to go. For most advertisers today, the latter isn’t a problem, but the former is. Do yourself a favor and set aside a “opportunity” budget of 5-10% of your October + November budget. Then, should one of these opportunities arise – a canceled placement, an emerging platform, whatever – you already have the funds and green light to deploy them.

This is going to be a roller coaster ride, but I hope some of these tips are helpful as you assemble your plan to navigate it.

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