The Conservative Shakeout
Despite the Republican Party’s victories up and down the ballot, it wasn’t a banner year for many data-driven conservative organizations, as some technologists and agencies were reportedly blacklisted after the Republican National Committee (RNC) merged with the Trump campaign in May.
The conservative data firm i360, a unit of the Koch brothers’ Freedom Partners super PAC, abandoned the presidential race despite working with the RNC the previous year on a joint data operation. And Targeted Victory, the largest Republican digital media agency in 2012, is shutting down.
Michael Beach, a co-founder of Targeted Victory who left to start a consulting business, said political agencies are ephemeral and it’s normal for staffers to move to other operations.
RNC deputy digital director Samantha Osborne and Logan Dobson, the Republican National Senatorial Committee’s director of data and analytics, for instance, were both recent Targeted Victory employees.
Democrats like to emphasize their deeper talent pool of political tech entrepreneurs and vendors, but Republicans say that characteristic causes a bottleneck between candidates and their media buys. Major Republican ad spenders, such as the RNC, focused more on platform-direct deals with Google and Facebook, with most of the remainder going to nonpartisan tech and media networks.
“Granted, there may be sum total fewer people whose jobs are data-driven and digital advertising on our side,” said one data consultant to the RNC who requested anonymity due to a pending job application. “But I’d rather have fewer, smarter people spending more money.”
The Trump campaign relied heavily on first-party voter matching and on platforms – Facebook especially – to do the targeting legwork, and on Rocket Fuel’s DMP for generating audience segments.
No Republican source said he or she considers Trump’s campaign a good indicator of how campaign media operations will be run in the future, but many expect the party’s major spending organizations to continue spending more with non-ideological vendors.
The Liberal Dream
Despite their recent defeat, Democrats’ approach to data and tech hasn’t shifted.
Andrew Drechsler, president of the liberal data analytics firm HaystaqDNA, said he sees “the one-stop shop approach” becoming more common on the Republican side, while “Democrats still have more hands on it, which can be good and bad.” It’s possible that Democrats will have to re-explore the boundary between “sharing best practices” and “overloading a campaign with partners,” he said.
The Democrats’ platform approach fosters a partnership-driven ecosystem.
DSPolitical integrated with NGP VAN for an ad-targeting solution meant to extend data-driven targeting to down-ballot candidates.
“The (Democratic National Committee) blessed it and pushed it out to states, but there’s no vast sum waiting [like the RNC’s $150 million],” Walsh said. “This past election, the right decided to push vast sums into the kind of targeting that we’ve been evangelizing on our side for years.”
Drechsler said the Democrats’ shared tech is a net positive, but that he does expect consolidation among liberal agencies. “Clients are asking for (consolidation), and that drives change faster here than anything in the brand world.”
And there are Democrats pursuing more of a commercial, full-service approach. The liberal digital ad firm Bully Pulpit Interactive recently acquired a strategic communications firm named Incite, which had worked exclusively with brands and public sector clients. And Bully Pulpit is being retooled with a heavier focus on brand spending.
Aside from the parties, the 2016 campaign was a crucial test for many companies new to the political world.
The results were anemic. Even on the Republican side, where more money went to nonpolitical tech and media, the winners were platforms and audience hubs (largely Google and Facebook, with a second tier featuring the likes of Hulu, Pandora and Twitter), not ad tech entrants.
Rocket Fuel may have been a vendor to the winning campaign, but sources told AdExchanger the company secured the account by accepting bottom-of-the-barrel margins. The company built out a double-digit political accounts team and DC office – which it closed after failing to hit budget projections.
Most ad tech newcomers to DC cautiously parachuted in one- or two-person teams, and many of those, like Tremor Video, TubeMogul, Quantcast, YuMe and SpotX, have tamped down political efforts or reverted executives back to nonpolitical business.
“It’s hard to be in this business if you don’t have a D or R tattooed on that everybody knows about,” said Jag Duggal, Quantcast’s senior VP of strategy.
In the upcoming cycle, the new DC media-buying competition may come from more familiar faces. For instance, the political data supplier L2 is adding a media-buying solution with L2 Media, which will be helmed by JC Medici, who ran Rocket Fuel’s political business last year.
“The phrase ‘political tech’ is misleading, because the tech isn’t political,” Medici said. “People pulling the levers have been overcharging because it’s a noncompetitive market, and if you’re relying solely on ‘political tech’ you’re probably in trouble.”
Other data suppliers haven’t followed L2’s lead, but Jordan Lieberman, political and public affairs lead at Audience Partners, said pure modeling and data firms are stretched by plummeting rates for offline and voter data, “so I wouldn’t be surprised if as a result you see more of them try to strap on media buying.”
L2 was pivoting into advertising because last year “a number of advocacy groups and campaign clients had this data but didn’t know how to run it or what to do with it, and they felt like they were letting the clients down,” Medici said. “You need healthy skepticism to make sure you’re not just telling each other what the other person wants to hear.”