Joe Trippi: Local TV’s Biennial Political Cash Bonanza Is Going to Fall Off a Cliff

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Cash CowIf there was one thing that newspapers could count on to keep their margins high while serving as a buffer against potential problems, it was classified advertising. This automatic and assumed cash cow made amends for strategic miscues in content and display advertising when the Web first arrived. Then, seemingly out of nowhere, came Craigslist and the age of free classifieds. That use of the Web to solve a consumer problem — newspaper classifieds were expensive — shredded the foundation of the newspaper business model, and has left the whole industry struggling for survival, with most observers suggesting it’s already over.

Classified advertising was such a sure thing that it became the industry’s Achilles’ Heel, and the speed with which things fell apart after Craigslist still serves to remind us that, in the digital age, old institutions can disappear in the twinkling of an eye.

Local television is on the same path, although not everyone agrees with that. If broadcasting has a “classifieds” — a guaranteed cash cow that it counts on as a buffer against collapse, it is political advertising. Given the enormous sums of money that broadcasters earn every two years, the business plan is to “survive” the off-election years and reap windfall profits when people start running for office. The problem is that changes in the world of marketing are already beginning to impact decisions on how and where candidates spend money. And like its free classifieds, the Web offers a much more cost-efficient mechanism for reaching the people that matter.

Joe Trippi is a name synonymous with politics and the Web. Wikipedia calls him “a mainstay in presidential politics:”

Trippi has worked on the presidential campaigns of Edward Kennedy, Walter Mondale, Gary Hart, Dick Gephardt, Jerry Brown and most recently John Edwards. Most notably, he served as campaign manager for presidential candidate and former Vermont governor Howard Dean.

Joe Trippi
Joe Trippi

In an recent interview, Trippi told Street Fight that while it would be business as usual for broadcasters next year, 2016 would likely see the beginning of the end of TV’s dominance in political advertising: “There’s a growing number of people who get it,” he said, “that there’s a better way to deliver a more targeted and relevant message without having to buy all that broadcast reach. It’s going to come. I’m seeing a growing percentage of people going to the Internet. It’s just a matter of time and innovation.”

Trippi thinks the 2016 election could well be the major turning point: “I don’t see it happening before 2016, and it might be Hilary Clinton. Her people, however, haven’t shown a tendency to learn from history, so I could see her coming into 2016 thinking ‘I learned my lesson. We need to run it like they did in 2012,’ which was essentially using online to raise a lot of money to spend on TV.”

With the Dean campaign in 2004, Trippi became the first campaign manager to exploit the unique abilities of the Web, and he’s quick to point out that “we’re just barely scratching the surface on this stuff.” As far as we know, he says, the application that might flip everything is being invented today. “In 2004. when the Dean campaign was breaking new ground, there was no YouTube, no Twitter, and Facebook was just on one or two campuses. The iPhone came along in 2007. It was impossible for even the campaign that innovated in 2004 to have predicted all that.”

He has a warning for political candidates everywhere: “Running the old Internet model, where it’s used only to raise money, at a time when messaging can pinpoint targeted individuals is an invitation to defeat. What we’re seeing already in terms of targeting pre-rolls, for example, or other messaging paths directly to someone interested is just barely scratching the surface of what’s going to be possible.”

Simply throwing money at the broad reach of television, he told us, is going to seem archaic very soon, and broadcast companies need to be prepared. This matches with other new data from Chicago-based media buying and selling software company Strata that reveals the pendulum swinging overall with TV advertising. According to this data, TV remains the top advertising medium, but the number of people saying they’re “more interested” in advertising on it is the lowest score in three years (44%). Meanwhile, digital jumped 16% from last year and now sits only a few points behind TV (35%).

As Phil Simon wrote in his seminal book on analytics, Too Big to Ignore: The Business Case for Big Data, the determining of sentiment via social media is not some pie-in-the-sky theory, and it has profound consequences for all forms of commerce and beyond.

Sentiment can be derived from many different sources: e-mails, social media, and other text-laden data. Its implications are nothing less than far-reaching. Forget commerce for a moment. It could transform politics, making traditional polling obsolete — and plenty are taking notice.

Who’s building the sentiment engines, and more importantly, who’s creating anything along these lines for us at the local level? Listening, as we’ve noted before, is the new skill and it’s vastly more sophisticated than most local media players can imagine. In the world of one-to-many, it’s hard to see the value of many-to-one.

Finally, at the end of our interview, Trippi concluded, “On top of all this, there’s the question of what is TV?” Indeed, and that’s just another reason for traditional broadcasters to be concerned that their biennial money tree is bound for the same place as newspaper classifieds.

TerryNaplesTerry Heaton is President of Reinvent21, a consulting company specializing in business reinvention for the 21st Century. He’s an internationally-recognized creative expert on all things web-related, especially as they relate to local media.

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