Politically Connected

In battleground states, a deluge of campaign cash transforms local TV markets like Roanoke, Va.

Roanoke, Va., makes up half of the 68th-largest DMA in the country, and while it’s just a four-hour drive from Washington, D.C., it may as well be a world away. A local joke has it that each mile between Roanoke and the nation’s capital equates to one more year going back in time. But this year, Roanoke is most definitely inside the Beltway.

Roanoke is the westernmost of Virginia’s major cities, far away from the wasteland of decaying strip malls surrounding D.C. like a moat. Heading south from Roanoke toward North Carolina, several places have fallen on hard times—among them, Henry County (with an unemployment rate of 11.4 percent and rising), Halifax County (11.5 percent and rising) and the city of Danville (13.1 percent and rising).

This is the South. The continental breakfast buffet at an airport hotel includes a Crock-Pot full of grits. When people around here ask how you’re doing, they really mean it. Virginia is as down-home as it gets. It’s also home to the all-powerful swing voter in this election year.

Virginia has quietly liberalized. It wasn’t even considered a swing state in 2008, when the Roanoke-Lynchburg market’s four major TV stations reportedly pulled in a combined $5.6 million during that record-breaking season for political ad spending. Some of that revenue came by way of direct spending by candidates, for which stations are required to charge the lowest unit rate. Others came in the form of “issue” ads purchased by ostensibly independent groups. For those commercials, the stations could charge what the market would bear.

What a difference four years has made.

As of Oct. 2, Roanoke’s CBS affiliate WDBJ alone had raked in some $5.72 million, exclusively due to issue ads from Super PACs. With those buys as well as ads from the presidential campaigns, the senate candidates and the local congressional race (dominated by a debate over the ban on mining the seam of uranium under Pittsylvania County), WDBJ’s total take from this year’s election could certainly exceed $20 million. How does Schurz Communications, the owner of WDBJ, react to the sudden wealth? “They’re not pissed off,” cracks general manager Jeff Marks. (Schurz confirms this.)

Some pundits have dubbed the 2012 campaign “the digital election.”

But they’re wrong.

Digital appeals targeted to narrow, or “microtargeted,” demographics have become trendy, but a new study by way of scientists at Yale University and the University of Massachusetts found that voters are actually indifferent when they’re addressed directly and downright hostile when targeted by mistake, as often is the case.

Meanwhile, the electorate is horrified that political campaigns are mining their data, according to the study.

All Photos: Ben Shaul

Digital spending is unquestionably enormous at an estimated $168.4 million—but traditional, local TV spots are still where the real influence is.

“If you’re after the independent voter—the guy who doesn’t look at politics until the last moment—that’s usually television’s weakness, but this time that’s its strength,” says John Shelton, CEO of Strata, which manufactures ad-buying software. “You want to get to people who haven’t engaged in politics.”

The most desirable demo, it turns out, isn’t the traditional 18-49, but 35-59. That is why an avalanche in the form of billions of dollars is pouring down on local stations in a string of battleground states—among them, Ohio, Colorado, Florida, Nevada and Virginia.

“I think a lot of things are going to change after this election,” says Brian Boush, WDBJ’s national sales manager, who has had to make political advertising more or less his entire job over the last few months. (Traffic assistant Mary Carpenter had to be moved to national and political ad sales to keep up with the huge number of orders.)

Boush never stops smiling; he’s friendly and deferential to a fault. But get him talking and he turns out to know everything about the market. Which is why when Karl Rove’s Super PAC Crossroads GPS wanted a 30-second spot during a rerun of The Andy Griffith Show—time that would have cost $300, maybe $350 last year—Boush ends up charging $1,600 without so much as flinching.

Boush trucks out folders containing sheaves of recent orders. (Stations must maintain a public file for every political ad buy, but Roanoke is in a small enough DMA that WDBJ isn’t required to have its records online for another two years.) Prime access (that’s Jeopardy and Wheel of Fortune on CBS), the 5 p.m. newscast and daytime are the most popular dayparts. Here, locals cannot flip on the 5 p.m. news without seeing two, sometimes three political spots per commercial break—and sometimes two ads for the same candidate.

Adweek sought comment from several Super PACs which had bought airtime in Roanoke this season, but with no success. With all political transactions going online in a few years, Super PACs have become extremely careful. There’s a box on the last page of every order sheet where the PAC is supposed to list the name of the candidate referred to in the ad, the date of the election and the seat sought. “They all leave it blank,” Boush says. “We have to go back and fill it in ourselves later.”

It’s a small price to pay: Crossroads GPS and its partner 501(c)4 organization American Crossroads have placed more than three-dozen buys with WDBJ this year, some going for as much as $280,000.

That kind of spending is far from the norm. Local anti-abortion group Gift of Life occasionally buys airtime on Oprah Winfrey’s OWN network through the local cable operator as well as NBC affiliate WSLS and Fox station WFXR—but only once in a while.

The conservation chair of the Roanoke chapter of the Sierra Club (a low-key guy named Dan Crawford whose day job is handyman) tells Adweek that his group’s opposition to the uranium mine is an exclusively yard-sign-and-grass-roots affair.

“I just pick the house [for the yard signs] where the most traffic goes by and knock on the door,” Crawford says. What’s the group’s budget like? Crawford hedges, but like everyone else in these parts, he doesn’t want to seem unhelpful. “It’s well under a grand, I can assure you of that,” he answers.

In March, Kip Cassino, evp at Borrell Associates, a research and consulting company across the state in Williamsburg, authored a report suggesting that political ad spending in all 2012 elections (across all media, including digital, direct mail and out of home, along with TV and radio) could hit $9.8 billion—$400 million of that going to Virginia. (This month, Cassino told Adweek his projection wasn’t off by more than 5 percent.) The Interactive Advertising Bureau predicts $10 billion in spending this year.

In part, the torrent of cash is made possible by Citizens United v. the Federal Election Commission, a landmark 2010 Supreme Court decision that made it legal for a new kind of “super” political action committee (PAC) to accept unlimited corporate and union donations and simultaneously disguise the identity of its funders by funneling them through 501(c)4 partners.

The ruling provided a way around most of the restrictions on political ad spending created by the 2002 McCain-Feingold Act, which outlawed “soft money”—unlimited campaign contributions that flowed into late 20th century politics through a legal loophole in the Federal Election Campaign Act.

But by 2010, the high court effectively ruled that money is protected speech, and it turns out some people (it’s anyone’s guess who) just won’t shut up. Cassino predicts that nearly half of 2012 spending will come from Super PACs.

So much issue advertising is negative (every candidate in Virginia appears to be “bad for America”) that overspending is likely to have counterintuitive results.

“[Negative ads] are meant to suppress the vote,” Cassino says. “If the impact of these ads is what it’s hoped to be by people who’ve paid for them, we should see a depressed turnout for the election this year, especially in areas where the saturation is greatest.”

But for the time being, it’s all silver lining and no cloud in Virginia, at least for those working in local television.

Stations have lost market share as viewers age and migrate to cable, so for them, it’s good to be back at the top, albeit briefly.

Marks swells with pride as he shows off the station’s new editing equipment and its giant, CNN-style touchscreen monitor, which weatherman Brent Watts and the station’s political reporters can use to demonstrate the arrival of cold fronts or election returns. The station was also able to open a bureau in nearby Danville and hire a reporter there after it became clear 2012 would be, to put it mildly, a banner year for political ad revenue.

By and large, staffers at WDBJ don’t seem, as in so many other small and midsize markets, to see the station as a stepping stone to greater things. A tiny corner of Marks’ office boasts a few photos signed by celebrities. An enormous trophy case sitting by the door sports family photos, as well as a baseball signed by Johnny Bench. Yet when Marks brags, it’s about how friendly he and his team are with the station’s advertising clients and how long he’s been a member of this community.

So, what to do after Election Day? If a person’s standing in the community is determined by testimonials from partners and customers, how does he go about asking his regulars to sit out the third quarter when ads for local car dealerships take a backseat to a tsunami of political spending?

“We warned ’em,” Boush says. “You don’t want to scare anyone, but some listened, and some didn’t.”

Boush and his boss, Lolly Quigley, started calling the station’s base of advertisers in October when political orders began to roll in, explaining the situation and stressing that inventory would be tight. Auto dealers and banks reserved ads they thought they’d need, and then everyone hunkered down and waited for the storm of political cash to blow in.

“You’ve seen the numbers, as far as the dollar amount that’s been spent here, but turning on the TV in the evening, it’s just pounding,” says Cameron Johnson, president of local dealer Magic City Ford Lincoln. “We’re usually pretty heavy on TV. We did buy strategically and early so we’d lock in some rates.”

Johnson says the only station that refused to play ball was WSET, the ABC affiliate in Lynchburg. “From a business-management perspective, good for them,” he says with a sigh. “It would be like a Super PAC coming in and buying all 500 cars on my lot right now.” (For double the sticker price, presumably.)

Randy Smith, president of WSET, says he also called key clients—but to ask that they rearrange their schedules around the election. “We said, ‘If you’re planning a big marketing event in October, maybe it would be better in September or early November,’ ” he recalls. Prices on political ads increase exponentially in the 10 days before the returns come in. Days before the 2008 election, Smith sold a single 30-second spot during the 5 p.m. newscast for $15,000. He only offered that price hoping to scare off the insistent buyer, as the scheduled spot was supposed to be non-preemptable. This year, Smith expects sales to peak at six figures per spot—putting WSET’s 5 p.m. news in a pricing category with national network buys during prime time.

On the Thursday afternoon this month when auto dealer Johnson relates his troubles in the local market this political season, the city is shaping up to get even busier.

“Romney’s got a rally going on today up the road,” he says. “Obama did a pep rally at the fire station—that’s where he said, ‘You didn’t build that.’ ” It’s fun to be the center of attention, especially when, as Shelton cracks, “I’m not sure most Chicagoans know there is an election.” But over the next few days, PACs, candidates and interest groups are gearing up to make their last big push, and Johnson isn’t about to drop thousands of dollars per spot on Andy Griffith and Wheel.

“I’m just lucky as a businessperson that we haven’t been hammered on the ad rates,” says the car dealer. “I’m going to be a better customer after Nov. 7.”

Maybe so, but can the market hope to return to normal after Election Day?

Cassino says we may be seeing the beginning of what he calls “the never-ending campaign.” In this cycle, he explains, the cost of a spot for a state senate campaign costs roughly as much as an ad for a candidate for the U.S. Senate last year, with corresponding increases in price all the way up the chain. The question isn’t ultimately how much money is spent, but why.

“I’ve never had anybody give me a dime out of the goodness of their hearts,” Cassino says with a laugh. “Maybe it’s an enormous amount of money just to get a dinner [with a politician]. And maybe it’s worth it.”

Does Cassino agree with Boush that lawmakers will move to keep this kind of spending in check?

“I think after this election, folks are going to take a hard look at what the impact of spending billions of dollars on political advertising has been,” he says. “And they may very well do something legislative about it.”

Still, Cassino says that means legislating against the same people who had been briefly thwarted by McCain-Feingold. As he points out, “They did that before and people found a way around that.”

Turns out it’s not city hall you can’t fight—it’s the chamber of commerce.