Politicians will spend a record amount this year on advertising to sway mid-term election results

Aug 23, 2010, Steve McClellan

The economy is still shaky, but that won’t stop politicians from spending a record amount this year on advertising to sway mid-term election results. And the political advertising floodgates will open right after Labor Day spewing messages — and an inordinate amount of mud, according to analysts — right up to Election Day on Nov. 2.
 
According to Borrell Associates, political ad spending will reach $4.2 billion this year, double the $2.1 billion the firm estimated was spent in 2008.
 
And Campaign Media Analysis Group (CMAG), a unit of WPP’s Kantar, also expects a record total, with up to $2.8 billion being spent by candidates and various special interest groups, vs. the $2.6 billion it said was spent two years ago.
 
Political spending this year is eye opening given that general market advertisers aren’t expected to return to pre-recession spending levels until at least 2013, according to PricewaterhouseCoopers.
 
It’s also striking given that 2010 is a mid-term election, when spending usually dips below the previous presidential campaign cycle. But not this year: “It’s become an endless campaign, that’s really what we’re seeing,” said Kip Cassino, vp research at Borrell.
 
Evan Tracey, president of CMAG, notes that this mid-term cycle has an unusual amount of highly competitive races, including close to 100 congressional elections, vs. the normal 35 to 40. In addition more than half of all the gubernatorial and senate seats are up for grabs.
 
“I can’t remember that much turnover before and they all feel like they’re in the cross-hairs of voters,” he said of the candidates. “And that competitiveness drives the spending.”
 
A January 2010 U.S. Supreme Court decision (Citizens United Vs the Federal Election Commission) also eased rules for corporate campaign contributions. Borrell estimates that the decision makes way for an additional $400 million in ads.
 
The robust spending is particularly good news for local broadcasters and cable operators — media businesses that suffered more than most during last year’s recession.
 
While both sectors have seen a rebound in their core businesses this year, the political dollars will help sustain the turnaround, executives said.
 
According to Steve Lanzano, president of the TVB, a local station trade group, most of its 600 members have reported core revenue gains in the 20 to 25 percent range so far this year. Political spending is “icing on the cake,” he said, although the group is not taking it for granted. “We’ve been very active in presenting our case,” to the candidates and various political consultant groups, he said.
 
The basic pitch: “You’ve got one shot and you either win or lose. So go with what works,” said Lanzano, referring to local TV.
 
And local TV executives haven’t been shy about pointing to what they say are the deficiencies of cable competitors, which have aggressively pressed for a share of the political pie over the last several election cycles. Lanzano contends that as satellite TV continues to add subscribers at the expense of cable, the latter medium “only reaches every other household in some markets and just 60 percent of households on average.”
 
But Andrew Capone, svp marketing and business development for cable sales firm NCC Media, counters that while cable may not reach every home in a given market, “that is more than off-set by the number of irrelevant homes that a broadcast signal reaches,” in most local races.

But the argument is almost beside the point, Capone said, noting that “there is a lot of money sloshing around out there right now and both local broadcast and cable will benefit greatly from it.”
 
That said Capone argues that cable systems, with their ability to serve ads town by town or county by county, “are uniquely able to target messaging in ways that broadcast just isn’t capable of doing.”  With an array of niche channels, cable can offer “very targetable demographics” said Capone, “so we can go in and offer not just one TV station but 40 to 60 individual networks. It’s more efficient in terms of voters reached.”
 
And while the :30 second spot via the TV screen is still the dominant messaging vehicle for both broadcast and cable, new techniques are emerging. Capone said NCC is offering a new on-demand platform this year that enables candidates to offer longer form spots.
 
Dubbed My Government on Demand, it’s available in about 30 million digital cable households, he said. But only a handful of candidates have bought time on it so far, including (perhaps not unsurprisingly) Meg Whitman, the former eBay CEO who is running for governor in California.
 
And Lanzano reports that TV stations are in the nascent stages of developing online video offerings and digital sub-channel techniques that would help the medium target more effectively and provide longer-form alternatives to the :30 second ad. “But that’s really the future,” he said.
 
According to Borrell, local TV is likely to command 63 percent of this year’s political dollars, or about $2.7 billion. Cable and radio will each pull in about 9 percent of the ads or about $380 million and newspapers will attract about 8 percent of the pie or $330 million.
 
One surprise: a relative paucity of online spending this year: Borrell pegs it at just $45 million or one percent of the take. “If people had learned the lesson of Obama you’d think they’d be all over it,” said Cassino. “It’s surprising how little the candidates are taking advantage of anything beyond what their moms and dads would have told them to do.”
 
Meanwhile, analysts say to expect lot of negative campaigning through Election Day. “This is going to be one of the most negative elections we’ll ever see,” said Tracey. For the many incumbents under fire, he said, “the only path to victory is to tell people, “you may not love me but this other candidate is really bad.”
 
But beyond that, Tracey said, the prevailing mood across the country is one of anger, given the state of the economy, unemployment and the rancor that’s been expressed over the healthcare bill and other issues.
 
“Everybody is pissed,” said Tracey. And as a candidate, “you have to be angry right along with them.”

By STUART ELLIOTTPublished: August 11, 2010

THE marketers and image-makers of Madison Avenue are asking each other, “What would you do if you were JetBlue?”

The question is, of course, prompted by the incident on Monday at John F. Kennedy International Airport when, after a dispute with a passenger, Steven Slater, a longtime flight attendant on JetBlue Airways, used the emergency chute to leave a plane that had arrived from Pittsburgh.

Mr. Slater’s swift slide to fame is being called an object lesson in the difficulties of flying today, a symbol of the dislocations in the workplace caused by the economy and even the arrival of a real-life version of the sassy character Johnny, played by Stephen Stucker, in the 1980 movie “Airplane.”

“This is a symptom of a much larger problem,” said Michael Watras, president and chief executive at Straightline International, a branding consultancy in New York.

“The airlines need to say, ‘We hear you, we feel this, and we’re here not just to get you from Point A to Point B but to treat you with respect,’ ” he added.

The publicity generated by the incident has been enormous, offering JetBlue a chance to take advantage of the attention to communicate in unique ways with potential and current customers.

But for the first 48 hours, JetBlue said nothing about the matter, an unusual course of action — or inaction — for a company known for skillfully cultivating the public through social media like blogs, Facebook and Twitter.

“What not to do is to stay silent,” said Michael Levine, the author of books like “Guerrilla P.R.” and “Guerrilla P.R. 2.0.” “Don’t do nothing.”

“This is a teachable moment” for JetBlue, Mr. Levine said, “to try to create context for what happened.”

For instance, he said that the airline could say something along these lines: “We understand that travel today is not always a luxury experience. We at JetBlue are trying to do everything we can for your safety.”

Conor Brady, chief creative officer at Organic in New York, a digital agency owned by the Omnicom Group, said it was “disappointing” that JetBlue did not immediately reach out.

Because “JetBlue is one of those brands that has a little bit of rebel in it,” Mr. Brady said, executives could have addressed the matter soon after it happened rather than let “corporate lawyers” silence them.

On Wednesday afternoon, the JetBlue blog BlueTales offered the company’s initial official comments. A post that carried the headline “Sometimes the weird news is about us …” did not mention Mr. Slater by name; rather, it slyly asked, “Perhaps you heard a little story about one of our flight attendants?”

“While we can’t discuss the details of what is an ongoing investigation,” the post continued, “plenty of others have already formed opinions on the matter. Like, the entire Internet.”

The post concluded with a reference to the 1999 movie “Office Space,” which mocks work life in corporate America, and a salute to JetBlue’s “fantastic, awesome and professional in-flight crew members for delivering the JetBlue experience you’ve come to expect of us.”

That JetBlue finally weighed in may be why comments online about the company grew more positive on Wednesday, according to Zeta Interactive, a digital marketing agency in New York, after turning sharply negative on Tuesday.

The tone of comments about JetBlue, as elicited by the Zeta Buzz online media mining technology, was 70 percent positive and 30 percent negative on Wednesday, Zeta reported, compared with 59 percent positive and 41 percent negative on Tuesday.

From the beginning of the year through Monday, Zeta said, the comments about JetBlue were 79 percent positive and 21 percent negative.

Comments about Mr. Slater were far more complimentary than those about JetBlue, according to Zeta, at 93 percent positive and 7 percent negative.

The positive figure was higher than Zeta found for the New Orleans Saints after they won Super Bowl XLIV, at 90 percent, and even exceeded by a percentage point the positive rating for Chesley B. Sullenberger III, who successfully landed a US Airways flight on the Hudson River in January 2009.

Even so, it makes sense for JetBlue to “stay away from” Mr. Slater, said Steven Thibodeau, chief digital officer at Kirshenbaum Bond Senecal & Partners in New York, part of MDC Partners.

“Let popular culture put this guy on a throne or crucify him,” Mr. Thibodeau said, adding that it was more important for JetBlue to “take the high ground” and focus on issues like its passenger safety record.

JetBlue “could have come out sooner” with its comments, Mr. Thibodeau said, because its executives responsible for corporate communications, public relations and customer service ought to have made contingency plans for an incident like Monday’s.

“They’re probably more prepared for a plane to land on the Hudson than for something like this,” he added.

Steve Rubel, senior vice president and director for insights at the Edelman Digital unit of Edelman in New York, said he believed that JetBlue was “doing the right thing” in how it had been handling the matter.

“Despite the fact that the Slater story has clearly resonated with disgruntled workers everywhere,” Mr. Rubel wrote in an e-mail, “as best as I can tell it is starting to run its course.”

It was far less disruptive for JetBlue than “the now-infamous 2007 Valentine’s Day crisis,” he said, referring to a snowstorm that stranded thousands of passengers, “which was arguably one of the key events that encouraged the company to jump into engaging” with consumers through the social media.

“JetBlue has built significant social trust equity” since then, Mr. Rubel said. “Therefore, in this particular case — especially given how isolated the event was — they don’t need to do more than they need to at this stage. This might not be the case for others, however.”

Social Media Usage on PCs Grows 43% in a Year as E-mail, Instant Messaging, Portals Decline

by Jack Neff

Published: August 02, 2010BATAVIA, Ohio (AdAge.com) — The time Americans spent on social media has surged 43% in the past year, leading a substantial shift in how the country spends its online time. That time spent online has also sent e-mail to third behind gaming, according to research by Nielsen Co.The time spent on social media accessed from PCs rose from 15.8% in June 2009 to 22.7% in June 2010, according to Nielsen, while online gaming gained more modestly to 10.2% of online time from 9.3% a year earlier. But that was enough to push gaming past e-mail, which fell to 8.3% of online time spent at the PC from 10.5% a year earlier.To an extent, separating social-media time from gaming time has become tougher, given that a growing portion of online gaming takes place via Facebook applications such as Zynga’s Farmville, Nielsen analyst Dave Martin acknowledged.“There’s significant overlap there, obviously,” Mr. Martin said. “A big part of the expansion of online gaming has been directly attributable to the expansion of online media.”

Mobile web access
The data also doesn’t include mobile web access, which still is predominantly used for e-mail, Mr. Martin said. The shift of e-mail use from PCs to mobile devices accounts for some of the decline of time spent on e-mail at PCs, he said.Online video and search also scored modest gains in share of online time, according to Nielsen. But despite increasing to 3.9% of online time from 3.5% a year earlier, online video time still only averaged an hour and 15 minutes per person per month, an amount of time many people spend with traditional TV on the morning of the first day of the month. YouTube accounted for about 70% of online video time on PCs, Mr. Martin said.Time spent on internet portals such as Yahoo declined faster than anything but e-mail, according to Nielsen.Instant messaging also lost share of time at the PC, Mr. Martin said, which was likely a result of increased use of mobile texting in part. Social-media usage also appears to be usurping some of the communications needs once reserved for e-mail and instant messaging, he said.