Political ads’ new target: Individuals

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Political campaigns seeking the biggest number of voters are increasingly aiming their TV ads at smaller and smaller territory. Their newest frontier? Individual homes.

A new service being offered by DISH Network and DirecTV that allows campaigns to target television ads at specific households is the latest example of how far granular political advertising on television has come since the Obama campaign first used it to extraordinary effect in 2012. The service, a type of “addressable advertising,” and other targeted TV ads are poised to play significant roles in this year’s midterm races, even as they raise questions about privacy.

“This phenomenon is set to really take over and dominate the political television advertising landscape,” said Alex Lundry, a former campaign staffer for GOP presidential nominee Mitt Romney and the co-founder of the Republican data firm Deep Root Analytics. “The whole world has been changing because of Big Data and analytics — the one holdout [thus far] has been the TV advertising space.”

DISH and DirecTV’s new service is even more focused than regular targeted cable advertising because it can single out individuals rather than just demographics.

In regular cable targeting, a campaign can take the list of voters it has identified as “persuadable,” a category that spans demographic groups and is based on voter file data, and work with media analytics companies to figure out which shows are most likely to attract viewers that fit those characteristics – a sports show or a lifestyle program, for example. The campaign can then run its ads during those types of shows in a bid to capture the most “persuadable” eyeballs.

Addressable ads go even deeper by making sure specific homes where such persuadable voters dwell see your ad no matter what they’re watching. Once campaigns have identified those households, they can turn to vendors that go between them and DISH and DirectTV to match which homes subscribe to the satellite providers. That way, a campaign can beam ads to individual homes regardless of what program or channel they are watching.

(Most large campaigns now use a combination of voter file data and commercial data to create a list of their persuadable voters — the people they think could determine the outcome of the election or be most susceptible to their message. The data used to create such lists could include a huge range of factors, from past voting behavior to lifestyle decisions, such as where people shop. Campaigns can also extrapolate which factors are most important by doing polling to model the electorate early on.)

Both DISH and DirecTV have had addressable advertising platforms for about 18 months and have run about 150 commercial ad campaigns between them. The partnership on political advertising is due to launch in March and was born out of marketers’ desire to place one targeted TV ad buy instead of several, company officials said.

“The political category was really the right place to start to bring that scale, and with 20 million households, really was bringing to the market a great complement to the local [designated market area] cable buy and a really good alternative to local broadcast,” said Keith Kazerman, senior vice president for ad sales at DirecTV.

Campaign operatives note that the 20 million-household reach of DISH and DirecTV is more useful to campaigns on the national level than for state and local races. In areas where the satellite providers have little presence, regular cable targeting may prove more productive. Still, addressable advertising is the next step up, and cable companies are likely to emulate the service in the coming months and years.

“We’ve been waiting for this for a long time,” said Danny Jester of GMMB, the media-buying firm that worked with Obama’s campaign to pioneer its granular ad strategies.

In any case, simply relying on broadcast advertising — where the only way campaigns can target their ads is by broad demographic groups such as age and gender – is a relic of the political past.

In 2012, the Obama campaign used what it called “the Optimizer” to buy cheaper ads on small cable networks that it was confident persuadable voters were watching. As a result, Obama aides say they increased their ad buying efficiency by 15 percent.

Obama’s campaign aides “were willing to be outspent among much of the audience, but weren’t willing to be outspent on the relatively small number of people they thought were persuadable,” said Bully Pulpit Interactive President Andrew Bleeker, who ran digital operations for the Obama campaign in 2012 and Terry McAuliffe’s successful campaign for Virginia governor in 2013.

Since 2012, people affiliated with both parties have worked to adapt what the Obama campaign did to a statewide level.

Analytics Media Group, a company started by Obama ad director Larry Grisolano, aims to deal with these types of targeted ads; Civis Analytics, headed by Dan Wagner, another Obama alum, recently announced a partnership with GMMB to focus on cable targeting; and BlueLabs, the analytics firm that worked with McAuliffe’s campaign, also is doing media optimization targeting. Lundry’s firm, Deep Root Analytics, does this for Republican candidates.

Targeted cable advertising played a role in both major gubernatorial races of 2013.

Lundry, who worked with New Jersey Gov. Chris Christie’s successful campaign, said one unexpected example of a successful targeted cable ad buy involved Friday night wrestling, which a surprising number of persuadable voters were watching.

Christie’s campaign advertised on 56 cable networks, up from 37 in his 2009 campaign — and cable ad buys were 21 percent of the campaign’s total media budget.

For McAuliffe’s campaign, examples include buying ads on Entertainment Tonight Weekend in the D.C. media market and Wendy Williams’ talk show in the Norfolk, Va., media market.

Targeted cable advertising can add to a campaign’s costs, including paying for the more rigorous data analysis than what is needed for traditional broadcast TV ad buys.

For now, the costs could be too much for many candidates running in more local races without the help of their parties’ national committees. In 2014, many experts say, cable targeting will be used by many of the top statewide races but is less likely to show up on the congressional level.

“It’s definitely an education process,” said David Neal, a Republican media buyer at Strategic Media Services whose firm is using targeted cable ads for at least one GOP statewide campaign in 2014. “There is a cost involved for the data matching—you have to have a big enough campaign to absorb those costs.”

For some voters, knowing that campaigns can target them specifically, no matter what they are watching, is unsettling and raises privacy concerns. But those involved in the addressable advertising phenomenon say they have built in safeguards to ease those fears.

For one thing, the satellite providers do not get a look at the campaigns’ raw data, while the campaigns don’t get a list of the satellite customers, because a data vendor acts as a go-between, DISH and DirecTV officials said. Also, viewers can opt-out of the targeted program and just see regular ads, the officials noted.

Targeted advertising also is campaigns’ latest foray into segmenting the electorate, a trend many voters don’t necessarily appreciate.

Eighty-six percent of respondents to a 2012 University of Pennsylvania survey said they did not want “political advertising tailored to your interests” — a figure notably higher than those that opposed tailored advertising for commercial products and services.

“I think they see politics as a major aspect of American life that has to be treated in a special way,” said Joe Turow, a Penn professor and co-author of the study. “And I think that people feel if they are targeted, they are losing out in the larger debate, for good or for bad. But a lot of times they may think, ‘What am I missing that somebody else is getting?’”