What Does Obama Re-Election Mean for Ad Industry?

Four More Years of Incumbent as Ground Game Trumps Super PACs

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Four more years for Barack Obama.
Four more years for Barack Obama. Credit: Bloomberg
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President Barack Obama rode an overwhelming advantage in the Electoral College -- and a slight margin in the popular vote -- to win another four years in the White House, besting Mitt Romney. Democrats were able to build on their margin in the Senate, while Republicans retained the House of Representatives. In other words: status quo.

As numerous Republican pundits eat crow, number-cruncher Nate Silver's brand value goes up and hundreds of social-media consultants prepare press releases claiming responsibility for the re-election, this much is certain after billions were spent on this presidential election: not only did super PACs and outside groups not buy the election, but they were trumped by the Obama campaign's ground game.

In the final weeks leading up to election, there was a last-minute rush of advertising by both the Democrats and Republicans. While the Obama campaign outspent the Romney campaign, super PACs and other groups affiliated with the Republican candidate kept the contest even, according to Kantar CMAG. One difference, however, was that the Obama campaign seemed to focus on get-out-the-vote efforts while the Republican forces continued promoting Mr. Romney or hitting Mr. Obama on the issues.

That difference could be seen online as well, where the Romney campaign was, until Sunday at any rate, still fundraising in some regions as Mr. Obama switched almost completely to get-out-the-vote efforts, including a promoted tweet and a Facebook push that sent notices to people suggesting they contact friends in swing states and encourage them to vote.

The effect on the industry
So beyond a poultry factory's worth of egg on the faces of pundits who'd called a landslide for Mr. Romney, what do the results actually mean for adland?

The tax deduction for advertising costs could be revisited. While Mr. Obama didn't bring it up during his first term, it's just the sort of tax loophole that was mentioned by both candidates during the debates.

Dan Jaffe, exec VP-government relations for the Association of National Advertisers, told Ad Age earlier this year that it would be unwise "for advertising companies to think we are immune. We will not take anything for granted."

Online privacy is another area of concern. William Rice, president of the Web Marketing Association, is certain that a second Obama term would result in stricter controls on gathering personal information on the internet. "If President Obama is re-elected, regulations on what advertisers can collect from websites will be severely restricted," he said. It should be pointed out, however, that the Obama campaign's prowess in data collection and analysis was a key element in its victory.

During his first term, Mr. Obama's administration made a number of moves toward restricting marketing aimed at children, especially in regard to food marketing. Margo Wootan, director of nutrition policy at the Center for Science in the Public Interest, said she hopes a soon-to-be-released FTC study on the impact of self-regulation by the food and soft-drink industry will revive the debate. "If Obama is re-elected, there could be a second push," she said.

The congressional picture
The real action, of course, happens in Congress. And with the Republicans maintaining control of the House and the Democrats keeping their majority in the Senate, not much is expected to change.

It is conceivable that Congress could decide to take look at the tax deduction for advertising costs, even if the subject isn't broached by Mr. Obama.

Rita Cohen, senior VP-legislative and regulatory policy for the Magazine Publishers of America, told Ad Age last month that "tax reform and deficit reduction still have to be dealt with, no matter the results of the election," she said. "And both parties say they want to look at all deductions."

Earlier this year, Linda Woolley, CEO of the Direct Marketing Association, pointed out that the political futures of certain individuals are more important than which party controls Congress. Direct marketers concerned with new restrictions on internet data have friends and enemies on both sides of the aisle.

Sen. Claire McCaskill, D-Mo., who won re-election, is strongly opposed to tightening regulation regarding internet privacy. Democrat Elizabeth Warren, who beat Republican incumbent Scott Brown, supports such regulation.

"Those elections are examples of when an individual member can make a difference," Ms. Woolley said.