The Melbourne Cup is supposed to be the race that stops the nation, but this year’s cup won’t hold a candle to the US midterm elections on the same day, on November 6, which could see the Republican Party lose control of congress. While prize money for the cup will be a record $7.3 million, it will only be chump-change against the record level of spending in the lead-up to the midterm poll, which covers national and state congresses, state governors and local officials, all the way down to the county and municipal level (including some courts).
US research group Borrell Associates tracks spending on campaign advertising, and in its final estimate for the November poll, reckons that political advertising for the elections will climb to US$8.8 billion, a 6.3% growth on the spend for the 2014 mid-terms. This is US$400 million more than an earlier estimate in April.
Broadcast TV is projected to get the bulk of the overall spending at US$3.5 billion, although Borrell says its share of the market (40%) will be 25% less than in 2014. Digital media will see spending jump to US$1.8 billion, for a 20% share, from just US$70 million in 2014.
Display ads will get the biggest part of that digital spending, at US$706 million. Digital video will hit US$373 million, while email marketing will get to US$362 million. Overall, the research says more than 60% of every dollar will go toward social networks in terms of display and video advertising. Cable TV is forecast to get to US$1.1 billion (a 12.5% share). Radio will see US$689 million (7.7%), newspapers/magazines, US$723 million (8.1%), telemarketing, US$501 million (5.6%), out-of-home, US$406 million (4.5%), direct mail, US$225 million (2.5%), and other print, US$100 million.
This is good news for the already profitable online giants. The Murdoch’s 21st Century Fox will benefit with higher revenues for its Fox free-to-air TV business and network and local TV channels, and its Fox News cable channel. Comcast will see a similar benefit for the NBC network and its MSNBC cable news channel. Newspapers will get a boost of around three quarters of a billion dollars from this spending. Trillion dollar tech giants, Apple and Amazon won’t see much in the way of revenue flowing their way, nor will Netflix.
What this means for the future is that 2019 will be a down year for the media thanks to the absence of election spending, but 2020, with the presidential and congressional elections, should see over $10 billion spent, if not more.
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