Is it November Yet?




Although the impending Presidential election is still months away, TV media buyers are already bracing themselves for what may be the most challenging election season of all time.

What makes 2016 any different from the past? 

There are four main contributors to the looming chaos. This post will break it down. 

1) Advertising Dollars - According to the LA Times, 2016’s political advertising is expected to reach an all-time high, coming in around $6 billion with the lion’s share going to TV. Local TV is typically hit the hardest, but with budgets this massive, national media will definitely tighten, particularly the news networks.

2) The Lowest Unit Rate law (LUR) – Even though candidates’ budgets are typically gargantuan, they’re offered the lowest rates. The FCC requires that for the 45 days before a primary and the 60 days before an election, stations must provide political candidates the “lowest unit rate” (LUR). The LUR is just that. It’s the lowest rate that a station has already charged another advertiser for the same type of spot (length, time of day, etc).  This gives the political advertisers the advantage of purchasing inventory at rock bottom rates, affording them an abundance of ads. And, it leaves the rest of us scrambling for the remaining space, usually with the highest bidder winning. 

3) Last-In-First-Out method (LIFO) – In addition to their giant purses and low price points, candidates are sometimes offered inventory even after it’s been sold. Not all stations use the Last-In-First-Out (LIFO) method.  With LIFO, the earlier a spot is placed, the lower the risk for it to be preempted (if all other factors are the same).  But, political advertisers are challenging the FCC on the LIFO method, claiming it compromises the LUR rule.  If the LIFO method becomes prohibited, it will allow political advertisers to come in at the last minute and preempt other advertisers who placed their media much earlier, on any station.  And, since the political advertisers must be allowed to run, general advertisers are at the highest risk of being bumped.

4) Super PACs – With Super PACs, political interest groups have unassailable amounts of money to pay for advertising. As early as February this year, hundreds of millions of Super PAC funds were reported for candidates still in the race. And, this number is climbing (although not all of it will go toward advertising). Super PACs are different from actual “candidate advertising dollars”. In fact, the candidates are not supposed to have any involvement with them. So, even though this is separate from traditional “political advertising”, (the LUR and LIFO rules don’t apply and stations can charge what they want), the budgets are so robust that their spending will overpower the schedules of many non-political advertisers.

With this much pressure on the marketplace, what’s a non-political advertiser to do?

Relax. General advertisers will still get air time. It’s just going to be a little more complicated than usual.

Buy your media as early as possible. So far, the LIFO method still applies. And, as long as it does, many stations will try to honor your buy if it is placed early enough.

Stay informed of what’s out there. Keep in touch with your sales reps and do your best to keep a finger on the pulse of their inventory. The more you know, the better you can plan. 

Communicate with your team. Keep your group abreast of what’s going on out there. The fewer surprises you encounter, the more strength you’ll have.

Good Luck, Everyone!

Nancy Schieber. Media Supervisor at Eicoff.