Friday, October 24, 2008

How Obama Is Spending $150 Million

How Obama Is Spending $150 Million


When college football fans watch the big Penn State vs. Ohio State game on Saturday, Oct. 25, there will be more going on than smash-mouth football. There will be smash-mouth politics, at least during the advertising breaks. It's the best chance before the Nov. 4 election for Presidential candidates John McCain and Barack Obama to reach male voters, especially white male voters in two of the remaining swing states, Pennsylvania and Ohio.

Senator Obama (D-Ill.), who raised $150 million in the month of September and may do nearly as well in October, will dominate the game's broadcast in Pennsylvania, according to Paul Roda, national sales manager of Harrisburg (Pa.) ABC affiliate WHTM. "There will be a lot of Obama, and more politics than any other single category, I believe," says Roda. It's the same story for the ABC affiliates in Cleveland and Columbus, Ohio, where the two candidates are battling for every vote.

Obama has a huge financial and tactical advantage in the final two weeks of the campaign. Senator McCain (R-Ariz.), who is participating in the public financing system for Presidential elections, has been limited to spending a total of $84 million in the two months before the vote. But Obama bypassed the public financing program and has continued to raise private donations.

The huge Obama cash kitty will give his campaign more maneuvering room in the complex dance that determines who can buy TV ads, when, and where.

"Fire Hose" of Funds

Not only can Obama afford to fund a more sweeping ground operation in key states such as Ohio, Pennsylvania, North Carolina, Indiana, and Florida, but he can well afford to pay the premiums that TV stations are charging as politicians compete against retailers, car dealers, and wireless phone companies that traditionally load up their ad buys in the last week of the month to bolster their end-of-the-month sales results.

Additionally, Obama can afford to buy both national and local ad slots, whereas McCain and the Republican National Committee have dropped national broadcast and cable buys to focus their more limited resources on targeted local buys in key swing states and congressional districts. An Obama campaign adviser, who asked not to be named, said: "It feels like we have a fire hose and they have a garden hose."

On Monday, McCain campaign manager Rick Davis predicted that by Election Day the McCain campaign and the RNC will have spent nearly $400 million for the two-month fall campaign, according to the Associated Press. He downplayed the impact of money on the advantage Obama currently enjoys in polls: "The lack of money in Wall Street has had more to do with the outcome of this last month politically than the money in Barack Obama's bank account."

Competing for Ad Slots

The World Series, whose first game was on Wednesday night, is tailor-made for the two campaigns. And the Fox affiliates in both the Tampa Bay area and Philadelphia, nestled in two of the last true battleground states, hope the Series between the Tampa Bay Devil Rays and Philadelphia Phillies goes to seven games. A Fox official would only say that the network and local affiliates were in heavy discussions with both campaigns about ad time. Ad availability for the first two games in St. Petersburg is sold out, with both campaigns having made significant buys.

Stations like Harrisburg's WHTM and Tampa's WTVT charge a 25% to 50% premium for an ad that cannot be preempted by another advertiser paying more for the time. Obama's campaign has stocked up on such buys during the next two weeks. Most of McCain's buys are for a tier below that, which means campaign officials get notified if another advertiser is trying to buy the same time slot, and can spend more to hold the spot.



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