Political people all talk about how this cycle – which by Spot-On’s estimates started sometime last year – is going to be different. For everyone.
We think that’s a safe bet. But we’d like to take this opportunity to throw some gasoline on that fire.
EVERYTHING YOU KNOW ABOUT ONLINE POLITICAL AD PLACEMENT IS GOING TO CHANGE.
And yes, we’re yelling.
Unlike past years, this is the only prediction we’re making this year. Why? Because – looking at Silicon Valley as both experienced insiders and as political buyers – we see fear, trepidation and concern when it comes to political advertising. All of which will encourage companies to shy away from online political placements.
Here are some of the factors we’re looking and how they may change the political ad market.
First, let’s talk about the money. Political ad revenue for online soared to about $1 billion in 2016. Yes, that’s lots of dough – anywhere but in Silicon Valley. For Google and Facebook, it’s less than 1% of their combined total revenue. But it’s 100% of their bad PR.
Bad PR for many tech companies, especially those that are what’s known as consumer-facing (Snapchat, Spotify, Facebook, Pandora), often comes down to avoiding complaints about the ‘user experience.’ This is why they have rules about ad lengths and sizing that aren’t anything like what you’re used to with TV. Old school media – TV, print, radio – relies on geography to herd users. On the web, users come and go. You want them to stay around? They have to have a good experience – they have to really like you.
This reasoning is why a lot of online outlets flatly reject ‘negative’ political ads and it’s why more will start rejecting all political ads, especially those for candidates.
It’s also why Facebook is changing the priority it gives items that appear in its users’ feeds. Last week’s announcement about creating more “meaningful” experience for Facebook is code for giving users “more pleasant” experiences. And that means a lot less political engagement.
There’s more. The U.S. Congress is not happy with the state of the online ad business. Nor is the Federal Elections Commission or the Federal Trade Commission.
Their companies are varied and long. In three separate hearings before the U.S. Congress and Senate, tech executives did not acquit themselves well. Facebook managed to frustrate Sen. Dianne Feinstein (D-CA) and Rep. Trey Gowdy (R-S.C.) on the same day and almost in the same manner. As they say in Washington, that shows a rare and special talent.
What’s bugging Congress? It’s a long list. There are the fears about Russian interference and the concern that similar tactics can be deployed by U.S. campaigns agains their opponents (in the current environment, they can). There’s a general sense of unease created by the Equifax data breach which is feeding concerns about data tracking, data management and what Facebook and Google ‘know’ about users. There are concerns about the black-box nature of online ad buying.
Put another way: The folks who are represented by online advertising like what it does – reach voters – but they don’t trust the people who are selling it. So look for clients to start asking tough questions about where their ads are running and why.
Traditional news outlets see this as an opportunity. A few are thinking about taking political inventory off the automated buying exchanges, looking to use political as a way to bust what they describe as “The Duopoly” between Facebook and Google.
Oh, and then there’s the technical stuff. Safari’s new web browser doesn’t allow cookie tracking for ads. More folks use mobile – which doesn’t work with cookies – for their online interaction. And new rules in Europe are preventing the use of personal information without that users consent. So as much faith as you may have in voter file matching – well, you might want to find a new church.
What do do? Brace – really brace – for change. Don’t rely on last year’s experience and certainly don’t rely on anything that happened in 2016. In “Internet Years” that was a lifetime ago.
For more insights, have a look at Spot-On’s best practices white paper. Send us an email and we’ll send one over.