Streaming video and audio via Over-the-Top (OTT) platforms, such as Connected TVs (CTVs), mobile phones, and smart speakers, have rapidly developed into competitive paid media options. CTVs are available in 75% of American households, and more American families have a CTV than a cable box.
Similarly, over 60% of the US population, or 169 million people, listen to streaming audio at least once per week. Political advertisers are considering how they can take advantage of the proliferation of OTT and streaming audio content to reach and sway their target voters.
The election cycle of 2022 will serve as a dry run for political campaigns to see how effectively they can employ streaming media to reach a specific demographic. In the past, election years have always been good for linear television, and especially for local broadcasters. While this is typically the case during years with a presidential election, the midterm elections this year have witnessed expenditure on a completely different scale.
Recent estimates from Kantar/CMAG put political ad spending in 2022 at $7.8 billion, which would be a record high and set the stage for even greater spending in the years to come. Equally important is their estimate that streaming will make up 15%, or $1.2 billion, of that total.
The ability to reach specific audiences based on their location is perhaps the most obvious benefit of streaming. Since this leads to significant savings, it greatly benefits candidates in large markets. So streaming allows a local Congressional candidate to narrowly target voters in her district directly in their houses rather than spending a fortune on TV ad spots for the entire LA TV market. Rather than having her ad play in the background or to everyone, she will only have to pay for voters who actively engage with it. Even though the CPM will be higher than with conventional linear, the total cost of the purchase should be lower.
The spending pace has quickened this season. Kantar’s previous spring estimate of $8.6 billion was revised to $9 billion recently.
This fall, Madhive, one of the most prominent ad tech companies, has been monitoring the amount of money spent on streaming political ads. By analyzing bid stream data, it has uncovered some unexpected findings. Using their proprietary device graph of 100+ million households across all US metro areas, they were able to correlate hundreds of millions of political perceptions across the country.
The average number of impressions of political ads on streaming services increased by 96% in October compared to the previous month, indicating an increase in advertising budgets.
While an increase in political spending is expected as Election Day approaches, the significant increase from September to October shows evidence that streaming is gaining traction with political campaigns.
The biggest boost in streaming ad spending has been in California. From October 3rd to October 10th, Madhive saw a weekly increase in impressions of 32%. Candidates and PACs would be wise to use streaming as a more cost-effective way to reach voters in California, home to three of the most expensive TV markets in the United States: Los Angeles, San Francisco, and San Diego.
Despite widespread coverage of the midterm elections for the House and Senate, advertisements have mainly focused on contests for governor. About 37% of political ad impressions are focused on gubernatorial races, 17% on state legislative races, 18% on House races, and only 8% on Senate races, as reported by Madhive. Considering these are nationwide figures, it stands to reason that House races would garner more attention than Senate ones, given only 34% of the Senate’s 100 seats are up for election this year.
Three Wisconsin congressional districts rank in the top five for total political ad impressions. Two of the Milwaukee districts and one of the Green Bay districts have uninspiring House races. However, Senate, Governor, and State Supreme Court races in the state are highly competitive, with potential for either major party. That’s why they’re throwing so much money at the state’s more populous regions to get their message across.
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