Marketing Briefing: Inside some of advertisers’ challenges in the 2024 election cycle

“We’ve got a unique political landscape [this year] with this shorter election season,” said Jennifer Kohl, chief media officer at VML, adding that it’s not just the presidential election but local elections that buy up much of the ad inventory during the crucial fourth quarter for clients. “It hasn’t been what we were expecting in terms of who was competing. Now we’re clear on — or we think we’re clear — on the candidates.” 

While political ad spending has already started to ramp up, with CTV a potential winner, marketers and ad buyers say they expect spending to increase in earnest after Labor Day and especially in the 60 days before the election. Buyers predict that political ad spending will increase 10X month-over-month, noting that approximately $3 billion has been spent throughout the first 10 months of the 2024 campaign cycle and that $10 billion is expected to be spent in the last four months.

“It’s a lot more competition for everyone’s attention,” said Bana Amare, director of activation at Media by Mother.

Marketers will not only need to contend with the flood of political ad dollars in the market but the shifting nature of where those dollars are spent. Buyers expect much of the spending will be on local TV in battleground states like Arizona, Ohio and Wisconsin, among others, where rate increases of roughly 20-30% are expected. Ad buyers also expect that rates will increase by 10-15% on national linear TV and on CTV. Aside from shifting spend from linear to CTV, spend on digital is projected to potentially double that of 2020, according to buyers, who believe that much of that spending will focus on social channels as well as influencer marketing.

Challenges for advertisers in the coming weeks will include pressure on inventory, more channels effected, higher CPMs and whether that advertiser can manage increased costs, the timing of fourth quarter, especially for clients still looking to hit revenue targets or that are often holiday gifts and consumers’ shift in priorities, explained Kate Kalevich, group director of media planning at Rain the Growth Agency. 

“There could be a shift in [consumers’] priorities depending on the nature of this election,” said Kalevich. “If this becomes very contentious, who knows what news they’re going to be making as we get closer to the actual election, it could be that that takes away from what people are really paying attention to at the time. So another thing to keep in mind is that you might be advertising during this time, but you might not see return on investment until after the election is over just because people might be so focused on what’s going on in that realm.” 

Kalevich suggests that advertisers tasked with having to advertise amid the political advertising landscape be informed of what’s going on, be flexible, track increased CPMs and don’t chase rates, as well as utilize other channels if some channels get too expensive. 

Whether or not consumers are too focused on the election isn’t the only mindset issue for advertisers this election cycle. “We’ve got to think about the economy and think about where people are at,” said Media by Mother’s Amare, of the consumer mindset for holiday spending this year. “People may have already maxed out their credit cards before going into a holiday. So I think that [mindset] shift has already kind of changed and the election is going to amplify that.”

3 Questions with  DeLu Jackson, evp and chief marketing and communications officer of ADT, security company 

What are the biggest challenges you’re facing in your role right now? 

For 150 years, and even in its recent history, the company was known for doing one thing extremely well in building a very successful business and protecting lots of families by doing residential home security. As that portfolio has expanded, we’ve innovated and brought these new capabilities, new services, new solutions to market, new partnerships, like Google and State Farm. It’s communicating that to the broader marketplace and making sure that the future state is understood consistently.

So how do you do that? 

It really has led to a transformation in our go-to-market. We’re over 70% — close to 75% digital now — and the transition has really been strong over the last three to five years as the next generation consumer changes their media habits, changes their consumption habits and where they spend their time. We were known as the direct seller, physical selling, so big growth in our e-commerce business and the ability for consumers who want to do it themselves to go online and complete those tasks.

Are there any channels in particular that you’re seeing growth?

We’re seeing a big growth in OLV and CTV. Streaming is really picking up and obviously entering that space is not just simple display or ads. It’s integrated content, it’s custom content. The off ramps are different — the ability to actually transact and and consume that information, and then actually complete tasks to take specific steps through digital connections, we’re testing and scaling in all of those places right now. Again, moving from more of an analog world to a data driven connected world. — Kimeko McCoy

By the numbers

Streaming ads are seemingly big business, with Paramount+ finally reaching profitability to join services like Netflix and Disney in the push for profitability. Measurement to ensure efficiencies in return on ad spend may still be top of mind for many advertisers at this point. A new study from BrightLine, a platform for interactive streaming ads, looks into the impact of interactive ads in CTV. Key findings from the study below: 

• 36% stronger top-of-mind brand recall with a single interactive ad versus a traditional 30 second spot
• 58% top-of-mind brand recall boost when interactive meets traditional
• 83% of viewers crave remote control action (Sorry, QR codes) — Kimeko McCoy

Quote of the week

“I had a debate with my procurement director over why we’re not advertising on Netflix and their argument was that ‘it costs too much for limited reach.'”

— A media specialist at a CPG advertiser, who requested anonymity when asked about Netflix’s ad business over a year-and-a-half in.

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