Fear and Loathing in Ad Tech
In 1998, Chip Bayer wrote a story in Wired called The Promise of One to One (A Love Story). It described one-to-one as the “holy grail of commercial...
With the 2014 elections still more than a year off, most people are not particularly engaged in politics. That won’t be the case for long. We’re already seeing gubernatorial, mayoral and special elections grabbing headlines and the congressional campaigns for 2014 are quietly starting to gear up.
As campaigns consider their communication strategies and tactics there is evidence that the game may have evolved since the last cycle. The 2012 elections helped validate the robust role of online media in campaigns and there is evidence of a new level of scrutiny concerning digital campaigning in the early planning for 2014. One interesting observation is the emergence of a left-brain mentality that would have been hard to imagine inside the old-time campaign “war rooms” of the past.
In the early 1980s Roger Sperry developed the theory of lateralization of brain functionality. According to this theory, a person who is "left-brained" is often more logical, analytical and objective, while a person who is "right-brained" is more intuitive, thoughtful and subjective. While politicians often favor emotional “right brain” speeches, television advertising and phone bank outreach, the growing ability to measure impact -- particularly for the emerging email, social media and online advertising channels -- may be changing their approach.
At their most basic level, political campaigns must accomplish three objectives: raise funds, manage communication on key issues and get out the vote (GOTV). Achieving these objectives requires a mix of strategic vision and tactical execution. Strategically, campaigns create momentum by using effective communications to generate enthusiasm, impacting opinion and get voters to the polls. The tactical methods used to reach a plurality of voters and raise money are all important because nothing is accomplished in politics if there aren’t enough engaged voters -- or funds -- to win.
The challenge is that too often the way a campaign accomplishes its tactical and strategic objectives involves two completely different forms of digital campaigning and technology.
Experienced campaign managers and media planners often characterize these two approaches as forms of inbound or outbound marketing. Inbound marketing channels -- which include cable television, radio, key word advertising and social media -- are useful for reaching audiences that are “self-selected” of have “opted in” based an interest in a cause or candidate. These audiences are considered inbound because they seek out the messages on their own through Fox News, MSNBC, Facebook, Twitter and so on.
In 2008 the Obama campaign tapped into the enthusiasm of the “converted” when it came to certain hot-button issues like the Iraq war. This audience didn’t need to be convinced on how they were going to vote, but they were still critical to the campaign when it came to enthusiasm, making news, fund-raising and get out the vote efforts.
Outbound marketing focuses on the rest of the electorate. Outbound is all about securing the necessary reach among persuadable voters in order to win. The tactics used include email, direct mail and online display advertising (driven by what, in the digital world, is called audience targeting). These voters may be less engaged in the election process but are being targeted because they have demonstrated historical or demographic patterns that suggest they can be persuaded.
Outbound marketing was employed heavily in the Obama 2012 reelection campaign because the leadership team understood that following the first term general enthusiasm would be down and talking to the converted alone would not be a successful strategy. To address this issue, data mining and predictive modeling were used to develop and deliver messages to a much broader set of voters. This audience was contacted in a gentle strategic manner on a regular, if not constant, basis in order to increase recognition of the issues, as well as to encourage engagement and participation,
When it comes to increasing reach and generating enthusiasm using inbound or outbound strategies, different media channels deliver different results. Modern campaigns should be applying left-brain thinking to determine the reach, impact and cost effectiveness goals of their media mix. To do this requires context. Looking at the three largest elements of most campaign media budgets -- TV, email and online display -- illustrates how left-brain candidates and their managers can track and evaluate inbound versus outbound efforts more effectively going forward.
Television: Only six years ago the conventional wisdom was that a national candidate could get elected by dominating television and radio with paid advertising, making extensive public appearances and a robust GOTV effort just before Election Day with phone banks and neighborhood canvasing.
Television was a simpler proposition then and was seen as the “go to” medium to reach the biggest audience. Starting in 2008 this notion came under increased scrutiny.
With the proliferation of cable television channels, what had been a single monolithic audience fragmented into dozens of interest-specific ones based on content. This fragmentation went beyond content to include affinities supported by the rise of partisan political channels focused almost exclusively on their respective base. The polarization of the electorate -- and the often strident tone of these channels -- have made it unlikely that undecided voters are going to rally to the partisan Fox News or MSNBC.
For voters looking for (relatively) non-partisan coverage, and for campaigns looking to reach beyond their base, network news programs and network ad buys seemed logical. Unfortunately, if one uses network news programs as a proxy for potential viewership of political advertising, the picture is grim. Since 1980, the three major networks’ nightly newscasts have lost approximately 28.9 million viewers, or nearly 55.5% of their audience, as the chart below shows:
With network news viewership down below 25 percent and the audience migration to cable (which itself has been reporting viewership at under 15 percent), television has become so awkwardly fractured that it is difficult, and in most cases too expensive, to achieve the reach or predictable return on the investment that a successful campaign requires.
For state and local candidates this problem is even more profound. The reality of shrinking and fragmented television audiences -- coupled with the ever-increasing costs -- simply puts anything but an election eve “Hail Mary” buy on late-night cable out of reach. In the face of this, campaigns have started to embrace email and online display -- two of the more actively left-brain outbound channels.
Email: A staple of the 2008 Obama campaign, email became the number one tool of the 2012 reelection campaign. This was due to the fact that by 2012 more than 68 percent of Americans had at least one email address, allowing the campaign to reach roughly 140 million eligible voters. A post-mortem report from the Obama campaign, Inside the Cave, looks at the digital and analytics operations of the campaign and details how predictive modeling based on voter demographics, behavior, interests and more than 10,000 tested segments allowed the campaign to identify the appropriate donation level to request from each prospective contributor. As a result, according to the report, the campaign ran 400 targeted fundraising campaigns and raised in excess of $155M. Email donors gave four times as often and three times as much as those who contributed in response to requests made through other channels.
From a left-brain perspective, email represents the optimal combination of reach, impact and cost effectiveness by making a direct appeal at a relatively low cost. Executed with precision and supported by intensive version testing, the Obama campaign’s email program serves as a prime example of what effectively targeted outbound marketing looks like. If television and other non-targeted techniques are viewed as the best way to communicate the candidate’s message, set the tone and get out the vote, then email and other outbound techniques are among the best at growing the base and reaching the most qualified audience with a specific and concrete request. Local and state candidates who don’t have the resources to cast a broad net and simply hope for the best have learned this lesson. Email is their best shot at reaching their constituency in a cost-effective manner.
Online Display: Online audience targeting has historically been based on browser cookies, giving ad networks the ability to infer people’s interest based on their site visit patterns. When an ad server recognizes a cookie, an advertisement aligned with the interests of the user associated with that cookie is served. Not only has this approach raised privacy concerns, but there are also questions of accuracy. The value of tracking and responding to behavior with ads also has a contextual limit when it comes to politics.
Since 2012, new technologies have emerged that allow online audiences to be identified in a manner similar to that used on television. Smart Zones -- a technology developed by my company, Semcasting -- has been used in more than 38 state races in the 2012 cycle and in some of the key gubernatorial races this year. Smart Zones technology applies location, demographics and historical interest data to IP address ranges. Specific individuals are never identified but audience tendencies can be derived and scored using publicly available offline data to predict sentiment, likelihood to vote and engagement levels at a neighborhood or business level.
The advantage of the Smart Zones approach is that whenever an aligned voter is online -- regardless of the site they are visiting -- he or she can be reached with a qualified advertising message. Compared with cookies -- which most ad networks acknowledge are active on only 30 percent of browsers -- Smart Zones-based campaigns are able to reach 100 percent of their intended online audiences. As a result, audience targeting is now a viable approach for political applications. (It is also worth noting that according to Google Analytics, of all the cookies in the cookie pool, only one in four represents a unique user.)
The ability to identify and reach voters with appropriate messages in real time at a cost that is dramatically lower than television -- or even email -- has made online display an appealing and effective outbound channel.
In Practice
Every candidate faces challenges in communicating their messages, raising money and getting out the vote. For some candidates, the traditional tools of television buys and phone banks still serve a critical role. They can be used to tell the moving right-brain stories every campaign needs. What these channels can’t do as well is satisfy the left-brain need to connect a defined number of voters with a predictable result. Approaches like email and online display can be analyzed, evaluated and tuned to deliver the right messages to the right voter and return the kinds of results TV could never hope to provide -- and at a fraction of the cost.
During the 2006 and 2008 political cycles social media became the rage of political campaigns in part because it was relatively easy to implement. It was also the closest thing to digital most campaigns had even considered up to that point. Candidates liked the idea they were “connecting” with voters and constituents and bean counters loved the idea they could do something “cutting edge” for so little money. Although some campaigns still remain stuck in this social-only digital mode even today, others have evolved.
What the cycles of 2010 and 2012 did for some in the political class was to demonstrate the necessity of expanding digital campaign strategies to include outbound marketing. With TV and social increasingly becoming primarily partisan channels, outbound techniques using email and online display were able fill a void in voter reach and targeted persuasion. These outbound channels allowed campaigns to apply the left-brain tactics of statistically refined predictive models to identify each optimal aligned audience. The left-brain the model also assisted in determining the right messaging and specific actions necessary to deliver winning results.
During the 2012 political cycle, the Smart Zones technology was used to drive online display and email advertising for more than 38 state races and over a dozen 501c3 cause-related campaigns – with 68 percent of those campaigns winning at the polls. Much of the online effort for these campaigns was focused on fundraising; but many also used digital to increase voter enthusiasm and turn out by driving voters to social and inbound channels. Key to the left-brain approach taken by these campaigns was the ability to achieve the maximum reach (even at a local level) among aligned voters. Online display and email campaigns effectively targeted more voters, creating better message awareness and familiarity with the cause or candidate at a cost that was manageable for their local budget.
There will always be a critical role for intuition, emotion and passion in politics; but as the last several cycles have shown, there will be an increasingly important role for the dispassionate analytics of left-brain thinking.
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