While political dollars promise additional revenue for certain media markets, not everyone is benefiting. For some in the spot broadcast business, it's a tale of two cities.
"All markets are not created equal," says Pat McNew, EVP, local media network, and director of operations for PHD. "While those 17 or 18 swing states are likely to see 14% increases in the third quarter, nonswing states could see single-digit growth."
Katz Media Group President Jim Beloyianis agrees. He expects high double-digit rises (17%-19%) for the third quarter, but only in markets attracting hefty political spending. Markets without political windfalls could see only single-digit increases.
"Spot broadcast is strong for third quarter, although July started off slowly, up 8%-10%. But our expectations for the quarter, with political, are positive," he says. Beloyianis sees automotive and telecommunications up, retail picking up, and a rebound in fast-food. How would local spot fare with those political dollars removed? Beloyianis projects gains of 5%-6%.
Jean Pool, EVP/COO, Universal McCann's LCI group, is divided. "Auto has exploded," she notes. "It's up double digits versus last year. But all other categories are flat or down. The 17 swing states are getting all the political spending. New York City hasn't seen a dime."
Robert Coen, SVP/senior forecasting director, McCann-Erickson, notes sluggishness in spending for food (-9%), beverages/snacks (-22%) and telcos (-21%) in spot TV for the 3Q. He sees problematic future growth for all local advertising and expects lowers total-year projections: up 5.5% instead of the 6% increase predicted for December. National spot is up 9% overall.