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Business of TV


AD-TECH FIRMS AND POLITICAL AGENCIES PREPARE FOR ANOTHER YEAR OF SPENDING
HEAVILY ON CTV

By Marty Swant  •  October 27, 2023  •  4 min read  •
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Ivy Liu

As political advertising ramps up during the 2024 election cycle, ad-tech
firms hope to make money on connected TV as campaigns increasingly look beyond
linear channels.

Earlier this week, Comscore and The Trade Desk debuted new audience segments for
political advertisers to help campaigns reach viewers across CTV platforms.
Using set-top box data that gets processed through Comscore, national, state and
district campaigns races will be able to re-target ads based on whether someone
has already seen a candidate’s or a competitor’s ad. Comscore’s new segments,
exclusively accessed through The Trade Desk, could potentially help campaigns
increase messaging during a pivotal political year — or decrease the frequency
to save money and avoid exhausting would-be voters.

“Television data provides such a unique window into the perspectives of the
individuals seeing the ads,” said Rachel Gantz, managing director of Proximic by
Comscore. “When you think about the types of viewership like where people are
getting their news from [and] what types of ads they’re exposed to, all of that
is far more recent data than their voter registration data.”

The partnership comes just a few months after Xandr, another key CTV player,
announced plans to ban political advertising on the Microsoft-owned platform.
Meanwhile, other adtech firms recently met with political agencies. Another,
Mobiquity Technologies, recently touted its programmatic platform’s own
political advertising tools that help determine demographic and psychographic
segments based on various data sources.

“When you look at how consumers and voters are spending time, it’s pretty much
like a 50-50 split in terms of linear versus streaming time spent,” said Kevin
Fisher, general manager of business development at The Trade Desk. “But 14% of
dollars are spent in connected TV, whereas the rest is in linear. There’s this
misalignment.”



CTV political advertising isn’t entirely new — it also played a role in the 2022
midterms — but campaigns have increasingly looked to reach viewers beyond
broadcast. According to AdImpact, overall political ad spending in 2023 and 2024
will reach a record $10.2 billion — up from $8.9 billion spent during the 2022
election cycle. 

While $5.1 billion is expected to land in broadcast coffers and another $1.9
billion goes to cable, AdImpact expects spending of $1.3 billion for CTV —
surpassing the $1.2 billion it forecasts for digital and nearly four times the
projected $361 million for radio. However, CTV’s overall share of spending is
only expected to increase from 12% to 13%.

Political advertising has been a boon for The Trade Desk in the past. During the
first quarter of 2020, CEO Jeff Green cited political advertising as a key
revenue driver. More recently, The Trade Desk’s second-quarter 2023 earnings
released this summer mentioned political advertising “could also cause our
revenue to increase during election cycles and decrease during other
periods.” However, it’s not the only company active in the space. Others
including Vizio and MiQ. Streaming platforms like Roku and Hulu and the
analytics firm SambaTV also have all worked with political advertisers in the
past and could be active again this cycle.



With high stakes, limited budgets and short time frames, political campaigns
often need to make immediate changes to media plans — something that’s not
always easy with broadcast and cable ad buys. Anything that ties linear and
digital data helps, said Ryan Meerstein, managing partner at Targeted Victory,
which works with high-profile Republican candidates. “What campaigns are looking
for is not just incremental reach, but immediate incremental reach. They’re only
getting so far with their linear buys.”

Super PACs might especially benefit from CTV advertising. Although linear
channels offer all candidates equal pricing, that’s not always the case outside
of broadcast.

“Our campaigns are offered lower lowest unit pricing on broadcast television,
and our super PACs are not,” Meerstein said. “So all of the sudden we now have
this streaming space that has broadcast quality creative. It now has cable reach
— if not better — and there is no price discrepancy between a campaign and a
super PAC. So we are actually seeing super PACs who are now seeing their lane as
to go buy CTV.”

Despite the potential advantages, others point out that CTV’s lack of
transparency standards has its downsides. Tyler Goldberg, director of political
strategy at Assembly Global, noted that political ads have to be disclosed
before the ad buy begins, which helps ensure everyone is being treated fairly
with pricing and air time. That’s because broadcast channels are held to federal
elections laws that don’t govern digital channels like CTV and social media.



“Spending drives other spending,” Goldberg said. “So if you can’t say ‘our
opponent is spending X,’ it’s a tough sell to say we should spend more…The lack
of required disclosures are really slowing down the growth of digital political
advertising.”

Presidential candidates are also looking at CTV earlier this election cycle than
in the past, said Melissa Kurstin, managing director at MiQ. She said this is
the first time her company has worked with candidates a year in advance.
Although candidates are already increasing spending, she also pointed out that
standardization across CTV inventory still needs to improve such as how
“premium” is defined across platforms. 

“When buyers talk about premium, they talk about content,” Kurstin said. “But we
need to focus on the outcome and the audience you want to reach … You can’t just
think about advertising on Hulu and Max and think the audience is static.”

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https://digiday.com/?p=523495



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