Political spending has been a bit lighter than BIA Advisory Services expected for this year, and the Republican presidential primary is looking less competitive than first thought. As a result, BIA Advisory Services is slightly scaling back its political ad expectations. It is now projecting local political spending will total $516 million this year. That is down from its summer forecast of $534 million, but the figure is still up significantly compared to the past two non-federal election years. BIA says $105.8 million was spent two years ago and $254.3 million in 2019.
“There will be less November and December spending because the Republican primary isn't as contested as we expected,” says VP of Forecasting & Analysis Nicole Ovadia.
She says that is largely due to former President Trump’s commanding lead in the polls and a growing expectation that he has the GOP nomination sewn-up even before the first votes are cast.
“They don't have much money, they're not spending much, and they're not raising much money – you can't spend if you don't raise,” Ovadia says. “Yes, these other candidates are technically in the race, but nobody's got momentum. I think that money's going to get spent on nonpresidential elections instead.”
The same factors that led to a slight scaling back of 2023 expectations have also convinced Ovadia to “take the foot off the gas” in next year’s outlook, although BIA is still expecting a gangbuster year for political spending. It estimates total local political ad spending will total $11 billion, a $500 million cut from its first forecast.
“It’s still going to be the biggest election ever, just not quite as big as we once expected,” Ovadia says. In 2020, BIA tracked $9.6 billion of political ads, so if its outlook for next year holds up it would represent a $1.4 billion increase from the last political cycle.
Slightly Larger Share For Radio
There are no national elections this year, but there are still competitive gubernatorial contests in states including Kentucky, Louisiana, and Mississippi while legislative elections are set for Louisiana, Mississippi, New Jersey, and Virginia. Wisconsin also has two state Supreme Court elections.
Even with a somewhat smaller political total expected, political ad spending is still giving the local ad market a boost as some traditional ad categories are hit-or-miss. BIA’s local ad forecast estimates $161.6 billion will be spent across all media this year.
“What is so interesting about 2023 is that it's a bigger number than we've ever seen before for political. It speaks to the length of the cycle and perhaps to off-years becoming more important,” Ovadia says. “But at the end of the day, it is nowhere near an even numbered year.”
BIA now estimates radio’s share of 2023 political dollars will be marginally larger than what it forecast during the summer. The firm estimates radio will capture 5.5% of the political ad spending this year.
“Politicians like to see and hear themselves,” Ovadia explains.
The biggest share, however, remains with broadcast television, which BIA projects will pocket more than four of every ten dollars spent. But the biggest gainer from years past is digital, which when all the online channels are combined BIA estimates will have nearly a quarter (22.8%) of local political ad spending.
BIA says the list of media markets that are expected to see the most political advertising remains unchanged from the summer. Los Angeles leads the list, with a projected $46 million in political ads. New York is second with nearly $34 million expected, followed by Tucson, AZ ($27 million), Detroit ($20 million), and San Francisco ($18 million).
While online spending is growing, campaigns are moving away from direct mail. BIA predicts that 9.3% of political dollars this year will be spent on direct mail. That is down from a 10.1% share in 2021 and a 22.8% share in 2019.
“It was getting more expensive to print and mail, and so that makes other media more attractive,” Ovadia says. But she thinks mail could see a rebound as companies do a better job at attribution and sell themselves as an alternative to privacy limits online. There is also an unexpected demographic play.
“Gen Z is into it,” she adds. “They don’t get mail, so there’s a novelty of getting a piece of mail with their name on it.”