The 2024 election will break advertising and fundraising records, with the Presidential election, every seat in the House and a razor-thin Senate majority on the line.
Ad Impact, a political research company, forecasts 2024 US political cycle spend to cross the $10 billion mark for the first time ever.
But with that kind of money pouring in, and with online ads as the fastest-growing media, one has to ask, why do so few political and public affairs advertisers embrace supply-path optimization (SPO)?
For one thing, DSPs have done a better job at navigating political agencies and advertisers, compared to the publisher side. Large DSPs hired evangelists and had more staying power in DC advertising circles. Second, political ad buyers are mostly unaware of the added friction when a DSP is added to the equation, rather than going directly to publishers and SSPs.
Ultimately, political advertisers rarely choose to develop publisher-direct relationships, because it’s a heavy lift (DSPs aggregate those deals) and political agencies tend to have leaner digital teams in the off years. Publisher direct deals are relegated to the back burner.
Missing the SPO opportunity
There are approximately two hundred experienced professionals who decide the vast majority of political ad spending. And that narrows down even further for digital advertising. Which means there is a clear opportunity to educate political advertisers and shift them to SPO as a strategy.
The most clear-cut reason for political advertisers to invest in SPO is the efficiency. If Pepsi reaches a Coca-Cola drinker, or was targeting women for a particular campaign but ads served to men, those impressions still hold some value for Pepsi. Political ads served to people who don’t live in the right state or district, say, or that serve to an opponent’s supporter, are well and truly wasted.
Political advertisers must also sharpen their practice because they’re popular targets of ad fraudsters. A report by the University of Baltimore estimated $377 million of political digital advertising went to fraud in 2020, and was likely far higher in the 2022 midterms. Why so much? Because the majority of campaign advertising occurs in the weeks leading up to Election day. Political advertisers must spend budgets quickly to influence the hearts and minds of voters, and that urgency means less accountability.
Political strategists and ad buyers have upped their programmatic game in recent election cycles. They’ve improved political ad KPIs and key reach and frequency metrics, to favor select inventory and first-party data segments.
But with these benefits, political advertising still hasn’t embraced SPO. Not yet, at least.
A path for SPO
Political advertisers have missed out on the benefits of SPO to date due to a combination of education shortfalls and missed opportunities. Most political agencies with in-house ad buying are unaware of the added friction from DSPs and other middlemen that can dilute inventory quality and take a cut of CPMs.
The DSP dilemma is unique for political advertisers, too. In swing states, we see situations where campaigns on both sides of the ticket and supporting super PAC spenders compete heavily for the same inventory, driving up rates. It’s a win for the ad tech, but inefficient for the political advertisers and the benefits don’t accrue to the publishers, either.
SPO is the way to get to those valuable audiences, often by serving fewer impressions to achieve the reach and frequency goals the political advertiser wants to achieve in a specific state or district.
The good news is, political advertisers are starting to evaluate SPO products.
In 2016, 2020 and the 2022 mid-term, political advertisers mostly defaulted to one or two DSPs for online ads. Google worked with everyone, and the next tier of DSP’s and streaming platforms competed for additional budgets.
This year, political advertisers and media consultants are evaluating the need to swim upstream and close the gap between the publisher and advertiser. Why? Direct deals increase the scale of first-party data segments that power the majority of candidate and issue digital programs. Political advertisers are also more keenly aware that when they go into spend-now mode, they can over-saturate audiences and turn them against their messages.
And political advertisers are trying new programmatic options because the biggest platforms are swearing off election ads. Meta formerly had large political agency teams on both sides of the aisle, but now takes a hands-off approach. Xandr and Verizon had politics teams in DC; Microsoft and Yahoo downsized in recent restructuring.
There is an opportunity for political-native technologists to test and prove new things, to fill the vacuum left by first-gen DSPs.
SPO is a highly impactful and efficient way to connect the political media supply pipes. We can’t always control election outcomes (or how many political text messages you get), but we can make the advertising process better for all.
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