<Article Co-Written by Adam Price>
The dust of the election has settled a bit, giving analysts from the business and marketing realms a chance to look at total spending on all sides, what was won, and particularly what was lost.
If you can still recall election night – I know it’s burned into my memories like a traumatic childhood embarrassment – you might remember the horribly uncomfortable moment when Karl Rove, the man who’s “brilliant with pre-election poll numbers,” was proved drastically wrong, simply put, because he had too much at stake to admit his errors.
Rove is a sultan (and heavy monetary supporter) of the Conservative Super PACs. American Crossroads, the largest of those PACs, spent over $100 million in support of, or opposition to, 20 federal and local candidates across the nation. Let me repeat … $100 million!
According to the Sunlight Foundation, a nonprofit organization fighting for government transparency, zero of the candidates that the Super PAC supported won, and only three of the candidates they opposed lost. For our numbers people out there, that’s a 1.24% Return On Investment. In a lenient political world where ROI over 50% is optimal, 1.24% is just unacceptable.
Much of this information has already made it around the networks and blogosphere, but one thing has managed to stay out of the discussion – how could anyone spend so much money with such a minuscule ROI?
The answer is simple: Rove used old school marketing in a new school world, and got spanked. The bulk of the PAC’s money was spent on Traditional Media; predominantly TV ads with limited research data behind their placement.
I work in the world of New Media Marketing, particularly online, so everything I do is in an effort to increase ROI for clients. This election gave us two examples of how you should, and should not, spend your advertising capital; proving a burning industry hypothesis – successful marketing techniques are changing … fast.
On one end of the spectrum, you have a political party with access to a plethora of capital, which they used to purchase empty ad space. American Crossroads used a blanket approach, airing over 82,000 TV ads in key battleground states. Shocker, but this strategy provided diminished returns. The inherent issue with the traditional use of TV ads is its lack of residual value and inability to reach new audiences. In layman’s terms, it lacked the micro-targeted approach that captures audience attention, and drives your audience to share your message to their extended networks.
The GOP is missing diversity in their electorate. This is a problem that the whole country is talking about. However, considering their approach to New Media, I think the real problem might be a lack of diversity in their marketing strategy.
I hesitate to call the GOP’s strategies ignorant, more a misuse of New Media that has hindered the GOP from reaching target audiences. Doomed Twitter hashtags (anyone remember the #AreYouBetterOff debacle?) and an inability to drive Social traffic – Obama held a 3 to 1 edge in Facebook likes – showed their misunderstanding of how to use Social Media during campaigning.
On the other end of the spectrum is a political party, also holding a plethora of capital, that was able to connect and talk to their target audience. Democrats successfully utilized all facets of New and Traditional Media, by understanding who they were talking to on each media channel. Democrats still spent tons of money on TV, but with a different approach.
Democrats used in depth, targeted data to help drive ad buying decisions. According to integrated media expert Rob Contreras, the Obama team’s use of Rentrak over the more traditional Nielsen ratings (particularly in Ohio) gave the Democrats a measurable advantage.
“Rentrak is able to monitor a much larger set of viewers at more frequent intervals, allowing the information to be accurately extrapolated and cross-referenced with other demographic data,” Contreras said. “Obama’s camp clearly did their homework and purposely sought out every competitive advantage they could find. Using Rentrak instead of Nielsen to develop TV schedules in swing states was a brilliant move on their part.”
This is not meant to be a how-to-spend-your-capital manual for the GOP, they can look to the Democrats’ playbook for that. What I saw in this election was a textbook case of New Media versus Traditional Media. It was a clash of different marketing strategies that should be taught in business courses across the globe. It’s a lesson that anyone trying to connect people to their brands should take to heart.
We are in a time of ever-changing demographics in the U.S., and this spells trouble for the future of the GOP. How they respond, we’ll see in four years, but it needs to provide higher than a 2% ROI.