Table of Contents
Introduction
As we approach another U.S. election cycle, many advertisers are noticing a disturbing trend: their Return on Ad Spend (ROAS) on Facebook is taking a hit. This phenomenon isn’t new, but its impact seems to be growing with each election.
Let’s explore how political ad spending during elections affects the broader advertising ecosystem on Facebook, and what this means for businesses relying on the platform for their marketing efforts.
The Scale of Political Ad Spending
To understand the impact, we first need to grasp the sheer volume of political ad spending on social media platforms, particularly Facebook.
- In the 2020 U.S. presidential election cycle, political campaigns spent over $1.4 billion on Facebook ads alone. [1]
- For comparison, in the 2016 election, political ad spending on Facebook was around $81 million.[2]
- This represents a staggering 1,628% increase in just four years.
Breakdown of Political Ad Spending
Let’s break this down further:
- In 2020, the Biden campaign spent approximately $99.5 million on Facebook ads.[1]
- The Trump campaign spent around $89.1 million.[1]
- Various PACs, state-level campaigns, and issue advocacy groups accounted for the remainder.
This exponential growth in political ad spending has significant ripple effects across the platform, affecting businesses of all sizes.
How Elections Affect Facebook's Ad Ecosystem
1. Increased Competition for Ad Space
During election seasons, the surge in political ads creates intense competition for limited ad inventory. This leads to:
- Higher Cost Per Mille (CPM) rates
- Increased Cost Per Click (CPC)
- Reduced ad reach for non-political advertisers
For example, during the 2020 election, some advertisers reported CPM increases of up to 100% in key battleground states like Florida and Pennsylvania [7].
2. Changes in User Behavior
Elections tend to dominate social media discourse, affecting user behavior:
- Increased time spent on political content: During the 2020 election, Facebook users spent 2.9 billion minutes viewing political ads [10].
- Potential ad fatigue and reduced engagement with non-political ads
- Shifts in consumer sentiment and purchasing behavior
A study by the Pew Research Center found that 55% of U.S. adults felt “worn out” by political posts and discussions on social media [11]. This fatigue can lead to decreased engagement with all types of content, including ads.
3. Algorithm Adjustments
Facebook often adjusts its algorithms during election periods to:
- Prioritize authoritative news sources
- Combat misinformation
- Ensure compliance with election advertising laws
For instance, in the run-up to the 2020 election, Facebook implemented a political ad ban in the week before Election Day [12]. While aimed at reducing misinformation, this also affected the strategies of many non-political advertisers who had to adjust their campaigns last-minute.
Historical Examples and Data
2016 U.S. Presidential Election
Facebook often adjusts its algorithms during election periods to:
- Prioritize authoritative news sources
- Combat misinformation
- Ensure compliance with election advertising laws
For instance, in the run-up to the 2020 election, Facebook implemented a political ad ban in the week before Election Day [12]. While aimed at reducing misinformation, this also affected the strategies of many non-political advertisers who had to adjust their campaigns last-minute.
2018 U.S. Midterm Elections
- Facebook CPM rates increased by 37% year-over-year in Q4 2018 [5].
- Many advertisers reported a 20-30% drop in ROAS during this period [6].
- Political ad spending for these midterms reached $284 million on Facebook [13].
2020 U.S. Presidential Election
- Political ad spending on Facebook reached new heights, with over $1.4 billion spent [1].
- Some advertisers reported CPM increases of up to 100% in key battleground states [7].
- A survey by Digiday found that 76% of media buyers saw increased costs on Facebook during the 2020 election period [8].
- The average CPM across all Facebook ads increased from $9.37 in January 2020 to $13.51 in October 2020 [14].
Strategies for Advertisers During Election Seasons
1. Adjust Budgets and Expectations:
- Be prepared for higher costs and potentially lower ROAS during peak election periods.
- Consider front-loading campaigns before the election season intensifies.
2. Refine Targeting:
- Focus on niche audiences less likely to be targeted by political ads.
- Utilize interest-based targeting that’s less competitive during election seasons.
3. Explore Alternative Platforms:
- Consider diversifying ad spend to platforms less affected by political advertising, such as LinkedIn or Pinterest.
- Investigate emerging platforms that might have lower competition.
4. Optimize Ad Creative:
- Focus on niche audiences less likely to be targeted by political ads.
- Utilize interest-based targeting that’s less competitive during election seasons.
5. Leverage First-Party Data:
- Use your own customer data for more efficient targeting.
- Create lookalike audiences based on your best customers.
6. Timing is Everything:
- Consider running campaigns during off-peak hours when competition might be lower.
- Plan major pushes for periods immediately before or after intense political advertising phases.
7. Focus on Quality Score:
- Improve your ad relevance score to potentially lower costs and improve ad delivery.
- Regularly update ad creatives to maintain high engagement rates.
Looking Ahead: The 2024 U.S. Presidential Election
As we approach the 2024 election, experts predict:
- Political ad spending on digital platforms is expected to hit a record $12 billion in 2024 [9].
- Increased regulation and transparency around political ads may affect the broader ad ecosystem.
- Continued evolution of Facebook’s ad policies and algorithms in response to election-related challenges.
Potential Impact on Advertisers
- Even higher CPMs and CPCs, potentially reaching unprecedented levels in key battleground states.
- More sophisticated targeting restrictions, affecting both political and non-political advertisers.
- Possible implementation of “cooling off” periods for political ads, which could create sudden surges in ad inventory availability.
Conclusion
While elections, particularly in the U.S., can significantly skew Facebook ad performance, understanding these patterns can help advertisers adapt their strategies. By anticipating these cyclical changes, businesses can better navigate the turbulent waters of election-year advertising and maintain their ROAS in the face of increased competition.
The key takeaway is that election seasons on Facebook are not just challenging periods to be endured, but opportunities for innovative marketers to stand out. By being proactive, flexible, and strategic, advertisers can turn these challenges into competitive advantages.
Sources
[1] OpenSecrets.org, “2020 Presidential Race: Facebook Ad Spending”
[2] Wired, “Here’s How Facebook Actually Won Trump the Presidency”
[3] AdEspresso, “Facebook Ad Cost: The Complete Resource to Understand It”
[4] AdStage, “Paid Media Q4 2016 Benchmark Report”
[5] Merkle, “Digital Marketing Report Q4 2018”
[6] eMarketer, “Political Ad Spending to Reach $6 Billion for 2020 Election”
[7] Wall Street Journal, “Facebook Political Ads: What the 2020 Campaign Looks Like in the Advertising Archive”
[8] Digiday, “Media buyers brace for wild election ride, potential Trump ‘October surprise'”
[9] AdAge, “2024 Political Ad Spending Forecast”
[10] NYU Cybersecurity for Democracy, “2020 Facebook Political Ads Analysis”
[11] Pew Research Center, “Americans are ‘worn out’ by COVID-19. Here’s why some are tuning out”
[12] Facebook Newsroom, “Preparing for Election Day”
[13] Tech for Campaigns, “2018 Midterm Elections Digital Ad Spend”
[14] Revealbot, “Facebook Ad Cost 2020-2021 Benchmark”
Stratos OneZero is a paid advertising agency based in Kottayam, Kerala, maximizing ROI through strategic Facebook, Instagram, and Google Ads campaigns. Our expertise spans Meta Ads, Google PPC, display advertising, and remarketing solutions. Partner with us to scale your business through data-driven digital advertising that converts.
