Why a Few TV Stations Will Make a Ton of Money on the Election

Sep 24, 2012  •  Post A Comment

TV stations stand to make a lot of money on the presidential election if they happen to be located in certain areas, NPR reports.

The story cites as an example Colorado Springs, Colo., where four years ago — when the town was also a key region in a swing state — 30-second spots that would normally go for $300 to $500 went as high as $7,000 when one of the national campaigns came in with money at the last minute.

“Spend time watching TV in Colorado Springs, Colo., and you’ll feel as though Mitt Romney and Barack Obama are King Kong and Godzilla, planted at the foot of the Front Range mountains for an epic fight that still has seven weeks to go,” the story reports. “This city is home to fewer than half a million people, yet campaign spending here has tripled since 2008, landing it among the top 10 advertising markets in the country.”

Spending is expected to be even higher this year than it was in 2008, the report says.

“This year everything is super-sized — except for the number of swing states in play. So a bigger pot of money is getting pumped into a smaller pool of states,” the story reports.

The report adds: “Broadcasters know there is a small window of time when they can charge a premium and campaigns will pay it. Campaigns have to get rid of their cash, because it will be useless the day after an election.”

Said Ken Goldstein of Kantar Media, a company that tracks political ad spending: "I’ve been someone who always sort of pooh-poohs ‘This is the record year. But this really is a year when there is such focus on relatively few markets that the levels of advertising we’re seeing are really uncharted waters."

According to research from Goldstein’s firm, political advertisers spent more than $300,000 in Colorado Springs last week — three times what they spent during the same time frame four years ago. And Colorado Springs is not the only market experiencing a boom.

“In Dayton, Ohio, since the beginning of the general election, ad spending has tripled compared to 2008,” NPR reports. “In Cedar Rapids, Iowa, political advertisers have spent six times what they did in 2008. In Richmond, Va., the increase is tenfold.”

Nationwide, ad spending is approximately double what it was in 2008, but in certain second-tier markets the increase is far greater.

“Even adjusting for the fact that fewer swing states are sharing a bigger pot of money, it seems that second-tier cities are getting much more attention than usual,” the piece reports. “Colorado Springs is not an obvious place for all of this presidential action. Republicans outnumber Democrats in El Paso County more than 2 to 1. Barack Obama lost this part of Colorado to John McCain by 19 points in 2008.”

The report adds: “Presidential campaigns know exactly the margin of victory or defeat that they have to hit in each town in order to carry an entire state.”

“Although no one suggests that President Obama will win Colorado Springs, whether he loses it by 15 or 25 points could determine whether he carries Colorado.”

A similar dynamic is also working in other secondary markets, such as Charlottesville, Va., the report notes.

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