Unprecedented campaign spending by Michael Bloomberg is a windfall for television stations across the U.S., but it might not be such a good thing for others—including the former New York City mayor’s fellow Democratic candidates.
The TV inventory squeeze might lead some candidates—Senate, House and state legislative hopefuls around the nation—to take a closer look at radio.
“I think we might have been one of the first campaigns to experience the ‘Bloomberg Effect’ on prices, but we certainly won’t be the last,” Eric Jaye, a California-based media buyer who purchased ads for Sylvester Turner, the just-reelected Democratic mayor of Houston, tells Politico.
The report notes that Bloomberg’s massive November advertising purchase, which covered the lower 48 states, inflated advertising prices in Houston by 45%—just as the mayoral campaign was winding down. Bloomberg spent $1.2 million in the Houston market.
Just two months into his campaign, Bloomberg—who as of Tuesday has a net worth of more than $60 billion, according to Forbes—has already spent nearly a quarter of a billion dollars.
Eight weeks into his presidential campaign, Bloomberg has already spent more money on advertising — $248 million — than most candidates could spend in years. That amount has squeezed TV ad inventory in nearly every state, lowering supply and causing stations to raise ad prices at a time of high demand, as candidates around the country gear up for their primaries.
Average prices for political television ads across the nation have increased by 20% since Bloomberg’s campaign commenced, Politico says. But media buyers cited in the report say Bloomberg’s pursuit of the Democratic presidential nomination isn’t the only factor driving prices higher: Inventory is growing increasingly scarce as early primary states will begin voting in the upcoming weeks. This is leading to concerns that down-ballot candidates won’t be able to execute advertising strategies.
“There is no doubt that rates are being driven up and it is making it much more expensive for congressional candidates and other down-ballot races to communicate in their own primaries,” a Democratic strategist told Politico. “In some ways that is difficult for candidates and campaigns that have been disciplined about raising money and are now faced with the fact that their money will not go nearly as far.”
Bloomberg, whose biggest advertising buys are heavily focused on Super Tuesday states, is expected by analysts to cross the $300 million spending mark by March. “You need probably $100 million to fully compete on Super Tuesday—none of [the Democratic candidates] are gonna have that except for Bloomberg,” Jim McLaughlin, a Republican media buyer who worked for Bloomberg’s mayoral campaign, told Politico. “If you’re Mike Bloomberg, the only way you’re gonna get any attention is by buying it.”