Aug 2, 2022 - Economy

Record ad spend for 2022 midterms

Political ad spending in 2022, by media type
Data: AdImpact; Chart: Simran Parwani/Axios

Nearly $3.6 billion has been spent on political and issue ads so far this year, putting the 2022 elections on pace to obliterate 2018's record as the largest midterm election year by ad spend, according to new data provided to Axios by AdImpact, an analytics firm.

Why it matters: A record percentage of ad dollars have shifted to streaming this cycle, allowing campaigns to target potential voters or funders with more precision than ever before.

By the numbers: Nearly half (44%) of the nearly $700 million spent so far on digital political and issue ads in 2022 have been spent on connected TVs, according to AdImpact. That's a huge jump from 2020, when connected TV advertising barely made a dent in political ad spending.

  • In total, AdImpact estimates that $1.5 billion will be spent on connected TV ads this year, surpassing the $1.3 billion it expects to be spent on Google and Facebook.

Between the lines: Unlike broadcasting companies, streaming and internet platforms aren't required to accept political and issue ads. Some, like TikTok and Twitter, don't take them. But the huge influx of cash is making some platforms rethink shutting out the opportunity.

  • Disney last week confirmed to Axios that it would allow political issue ads — in addition to candidate ads — on Hulu, after controversy broke out over the platform's decision to reject political issue ads around guns and abortions from Democratic groups.
  • Spotify earlier this year said it would resume accepting political ads after pausing them in 2020, though it won't accept issue ads.

Yes, but: The vast majority of political ad spend remains on local broadcast stations, where — despite ratings declines — political strategists are the most optimistic about outcomes.

  • "Political practitioners just don't have confidence in streaming to move numbers the way they see it on broadcast and cable," said Eric Wilson, a veteran GOP digital strategist.
  • "They know when they spend on TV they see movement in the polls."
  • Local broadcasting can also be more reliable, in some respects. Broadcasters are not allowed to refuse a candidate’s ad based on its content.

Be smart: Changes to the digital privacy standards are having a profound impact on campaigns, which in the past relied heavily on the ability to granularly target voters on Facebook to collect email addresses or solicit fundraising dollars.

  • "If you're running a campaign targeted towards less than a million people, you're going to have a very hard time being able reach people you want to reach," said former Obama communications official and political strategist Bill Burton. "I think search (advertising) is going to be the beneficiary of a lot of it."
  • "For a long time, Facebook was really helpful for email list-building and lead generation — stuff that's good for good for fundraising. But we’ve seen that slow down," Wilson said. List-building "now just becomes balkanized."

The big picture: In 2018, roughly $3.96 billion was spent on issue and political advertising in the U.S., per AdImpact.

  • So far in 2022, roughly $3.57 billion has been spent — more than three months out from election day — thanks to a slew of competitive house races and primaries.

What to watch: AdImpact originally forecast that the 2022 midterms could nearly outpace the historic $9 billion in spending during the 2020 presidential election.

  • A recent slowdown in grassroots fundraising for Republicans isn't expected to stop that momentum, given the continued momentum of high-dollar Republican donations and grassroots money being raised by Democrats.

Editor's note: We've removed two sentences listing the percentage share of political ad spends on streaming platforms that included some inaccurate numbers.

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