Political Ad Spend to Soar

December 06, 2007
By Steve McClellan

Barack Obama and other presidential hopefuls are expected to spend freely on campaign ads in '08, according to PQ Media.
NEW YORK Political campaign spending on advertising media and marketing services is expected to soar 43 percent to an all-time high of $4.5 billion in the 2008 election cycle, according to a just-released analysis from ad and marketing research firm PQ Media.

The Stamford, Conn.-based firm cited record fundraising, the high number of presidential candidates and "an acrimonious political environment" as key drivers of the projected spending splurge.

"A key trend driving growth is that this is the first election since 1928 without a current member of the executive branch running for office, which has resulted in an unusually high number of presidential candidates participating in the primary season, as well as a discordant political landscape on several fronts," said Patrick Quinn, CEO of PQ Media.

Political ad spending across all media is projected to reach $3.03 billion, and account for 67.2 percent of all political media spending in the 2008 election cycle, according to the PQ study. Additional spending on political marketing services, including direct mail, public relations, and promotions and event marketing will reach $1.48 billion and account for the remaining 32.8 percent. The firm predicted that marketing would continue to gain share from advertising due to more sophisticated databases that allow direct mail strategies to be targeted to the unusually large number of battleground states in the 2008 elections.

PQ predicts that several advertising and marketing segments, such as cable TV and direct mail, will exhibit significant gains due to critical television station inventory trends, particularly in New Mexico, Pennsylvania and Florida.

That said, the firm stressed that broadcast TV would command the largest share of political media expenditures in 2008 with 51.3 percent of the total. But candidates will continue to shift budgets to other media strategies like public relations, promotions, event marketing and the Internet to reach key target demographics.

Campaign funding growth has expanded the use of other media, particularly direct mail, which is projected to generate more than $1 billion in spending for the first time in 2008, PQ said.

Internet ad spending is expected to exhibit the fastest growth during the 2008 campaign, up an estimated 84 percent compared with 2006, according to the PQ study. Other media projected to exhibit high double-digit gains are public relations, promotions and event marketing (56 percent), direct mail (53 percent) and broadcast TV (46.2 percent).

The presidential race is expected to command the largest share of spending in 2008 at 37 percent, or $1.67 billion, while the Senate and House races will account for 19.4 percent and 21.4 percent, respectively. Due to significantly fewer gubernatorial races (11 versus 36 in 2006), spending by gubernatorial candidates is expected to account for less than 4 percent of overall expenditures, while local races and spending on referendums will account for the remaining 18 percent.

"While most political pundits currently have the Democrats winning the presidential and most other elections, some of them don't realize that the Democrats are more vulnerable to voter shifts due to so few states in which their party currently has a safe lead," said Quinn. "This has resulted in campaign spending being spread across more states in 2008 than during the 2004 election."