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The Michael Bloomberg Effect: Super Tuesday’s Big Winners Are TV Stations - Deadline

Joe Biden’s campaign debuted a last-minute campaign spot in Minneapolis on Super Tuesday, one that featured Amy Klobuchar endorsing Biden just after dropping out of the race. The last-minute ad speaks to the stakes involved in the 2020 presidential race.

Michael Bloomberg’s injection of hundreds of millions of dollars, coupled with the buys of another self-funder, Tom Steyer, who dropped out on Saturday, has changed the dynamics and shattered records for presidential primary spending, and has given TV stations a greater-than-expected boost in the early months of the year.

Last week, some of the largest station groups, including Nexstar Media Group, Gray Television and Sinclair Broadcast Group, reported their earnings and all highlighted political ad spending as bright spots, in some cases raising their revenue projections for the rest of the year.

Chris Ripley, the CEO of Sinclair, told analysts that “we expect 2020 to be our highest political revenue on record.”

Perry Sook, the CEO of Nexstar, told analysts that they were off to a “very strong start.” He said that Bloomberg’s spending was a “good lead portion of our first-quarter money, but there is some offset because we think there is some candidate and PAC money that’s probably on the sidelines because of his spending right now.”

Among the biggest unexpected beneficiaries of the ad blitz are TV stations in California. With the primary moved up to March, rather than June, the state is much more of a factor in the nomination race than in previous cycles. But they also have a candidate, Bloomberg, willing to spend huge sums across the state in an effort to compete, whereas other campaigns are depending more heavily on so-called “earned” media, or interviews on local newscasts, morning shows or, in the case of Elizabeth Warren, an appearance on The Ellen Show on Tuesday.

According to analytics firm Kinetiq, Bloomberg has spent $72 million on TV ads in the state since January 1, compared to $70 million for Tom Steyer, $8.2 million for Bernie Sanders and $750,000 for Biden, whose investment was made only in the last week.

“It has been a windfall more so for California markets than other states because … our primary has coincided with Super Tuesday,” said Bob McCauley, SVP Integrated Marketing Solutions at Entravision in Palm Springs, CA, where the company owns NBC and Univision stations, among others. “The spending in California is far past expectations and Steyer and Bloomberg led the way.”

The last time that the California primary coincided with Super Tuesday was in 2008, when it was held on February 5.

“The California primary for presidential candidates was never a factor because it was so late. By moving the primary up, at last we saw the state important enough to campaigns to increase their spending,” said Jerry Upham, general manager for News Press Gazette Co.’s six Palm Springs stations.

He said that political ads have been a “little bit more than we projected.” He said that spending was dominated by Bloomberg and Steyer, but that has been tempered somewhat by other candidates who have purchased fewer ads than they thought. He also said that it is too early to say how the company will use the additional money.

Still, the billionaire candidates may end up proving that saturation ad spending only goes so far: Steyer pinned a lot of his hopes on South Carolina, where he spent an estimated $13 million on TV ads, according to FiveThirtyEight. But he dropped out soon after the race was called for Biden.

Bloomberg’s poll numbers began to shoot up as he saturated the airwaves and a host of other media platforms with his campaign spots. But his momentum slowed after a poor initial debate performance.

According to Advertising Analytics, Bloomberg has spent more than $500 million on ads across all platforms, to the point where he his outlay has been “almost like a new category,” as it is such an outlier from traditional campaigns, said Evan Tracey, Republican media consultant and adjunct professor at the George Washington University Graduate School of Political Management.

He said that in some markets Bloomberg is “not only the biggest political spender but the biggest spender.”

Tracey said that some of Bloomberg’s ad buys are puzzling, “but not in a sense he is doing everything wrong. He is doing everything because he can. For a consultant, that is like leaving no stone unturned.”

Even if Bloomberg sputters on Super Tuesday and drops out, stations still are expecting a robust political ad market. Sanders has a huge haul in small-dollar contributions to drive his campaign, while Biden’s fundraising likely will pick up with a narrow field if he wins a substantial number of delegates. Bloomberg also has indicated that, even if he is no longer in the race, he still would pour money into the election with the goal of beating President Donald Trump.

“It appears that the trajectory that this race is that ad spending is going to continue to be part of everyone’s strategy,” Tracey said.

Kevin Latek, EVP at Gray Television, told analysts last week that they will benefit under either scenario.

“From our standpoint it’s kind of if a nominee is essentially known after Super Tuesday that theoretically means that we see general advertising spending on both sides starting pretty early because the candidates are framed,” Latek said. “On the other hand if the candidate is not known by the Super Tuesday, and it takes another month or two or it even goes to convention, then you’ve got a lot more primary spending. And maybe the other side spends more money attacking a variety of opponents. Our view is it’s six one way or half-dozen another.”

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The Michael Bloomberg Effect: Super Tuesday’s Big Winners Are TV Stations - Deadline
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