GOP bigwigs aren't the only ones worried about Donald Trump winning the Republican presidential nomination.
Trump has emerged as the Republican candidate to beat while spending far less on television advertising than his rivals, a source of anxiety for TV station owners across the country who are banking on a record level of political ad spending. It's a novel campaign strategy of generating free TV coverage with ever more outlandish events and statements.
His approach has made a mockery of his opponents' traditional approach of spending prodigious amounts on TV ad campaigns. Indeed, their spending this year — and a 2010 Supreme Court decision that opened up campaign spending — has boosted projected political TV revenue in 2016 to a new high point, reaching $4.4 billion, up from $3.8 billion in 2012.
But while local TV stations have been distressed over Trump's lack of ad spending, some industry analysts think the situation now may change in the general election.
So much negative advertising — from both Republicans and Democrats — has cast Trump as a political loser that some observers say he now might have to ramp up his own advertising to counter the attacks.
Independent “Stop Trump” groups have spent more than $20 million in opposition to his nomination.
Larry Sabato, professor of politics at the University of Virginia, believes that Trump will have to step up TV advertising in a general election campaign against Democratic front-runner Hillary Clinton.
“They both have 100% name ID and voters have a sense of who they are,” Sabato said. “They don't have to advertise in ways that other candidates do. They are not going to have to tell the family story. It's pointless. They will still need negative advertising. The campaign is going to be scorched-earth.”
Trump brings an unpredictability to campaign spending — and that includes a possible increase in dollars from the Republican Party in support of Senate and House candidates fearful of being pulled down by a crushing loss at the presidential level. Trump is shown running behind Clinton.
“The Republicans know they are in trouble,” Sabato said. “One of the recommendations from the party to candidates running for Senate and House seats is to spend, spend, spend.”
Political advertising has become a major profit center for TV stations in hotly contested swing states like Florida, Ohio and Colorado. Presidential election years in particular can be bonanzas.
But if Trump decides to just rely on his celebrity and advertise less than a typical candidate in the general election, TV station owners could miss out on a bounty of revenue usually expected in a race this heated.
“Most broadcasters think they will net out coming close to expectations, but they are really nervous about it,” said Bill Day, a vice president for Frank N. Magid Associates, a consultant firm with a number of broadcasting clients.
“They have so much baked in on the back end of the year, and if they are wrong there is no recovery time,” Day said.
Trump has played his celebrity to the hilt.
“In an environment like this where somebody is proving a disruptive model — Trump is saying ‘I'm a reality TV star and I know how to move things without using television advertising' — it's a scary space,” Day said.
Trump's confidence in his free media skills could result in him spending less than the $492 million that 2012 Republican nominee Mitt Romney put into TV ads, said Elizabeth Wilner, senior vice president of Kantar's Campaign Media Analysis Group, or CMAG — but not a lot less if he wants to be competitive against Clinton.
“He may not spend what a typical Republican nominee would spend and he will get a lot of earned media,” or free airtime through news coverage, Wilner said. “But the Democratic Party is going to be on his case every day.”
The projected increase in political advertising is due in part to the Supreme Court decision that removed limits on spending by independent expenditure groups that include corporations and unions.
According to CMAG, local TV stations can expect to get $3.3 billion in political advertising this year, and some analysts have predicted an even higher take. National TV networks see little presidential ad spending because campaigns use their money to target the battleground states that will get them closer to the 270 electoral votes needed to win the White House.
Those robust projections were made before a Trump nomination emerged as a real possibility. During the primary season, Trump has spent just $17.5 million on paid advertising (TV, radio and cable) through March 24, according to CMAG and Ad Age Datacenter.
That's much less than the amounts spent on behalf of his vanquished opponents Jeb Bush ($80 million) and Florida Sen. Marco Rubio ($70 million) and below the totals for the remaining GOP contenders, Texas Sen. Ted Cruz ($32 million) and Ohio Gov. John Kasich ($18.5 million).
“If you're a TV station group owner and you have a lot of competitive House and Senate races in your state, then you're OK,” Wilner said. “If you're an owner who has
a lot of stations that have nothing else going on but the presidential race, you're worried.”
The uncertainty over how much Trump will spend on advertising comes with the billionaire's ability to lead in the Republican delegate count largely through his skills as a TV personality to get free airtime.
A study by research firm MediaQuant said Trump has received $189.80 in free TV exposure for every dollar he has spent on ads this year through February. Cruz, by comparison, has received $14.20.
“Trump's rise to prominence was media-driven,” said Chuck Todd, NBC News political director. “Whether it was as the [United States Football League] guy, as the Atlantic City guy, as the New York City developer guy, as the ‘Celebrity Apprentice' guy — it's what he knew. It's what he was comfortable doing.”
If Trump decides to be less outrageous to become more palatable to general election voters in the fall, he may not be as entertaining for TV viewers — another reason that he may need to buy advertising and run a more conventional campaign.
“If he becomes the nominee and he starts becoming more presidential and his interviews are not exciting, you're not going to see as many of them,” said one veteran network TV news producer who was not authorized to speak publicly on the matter.
Wall Street analysts have pressed publicly held TV station groups to address the business impact of Trump beating Cruz or wrangling enough support for the nomination at a brokered Republican convention in July.
Companies such as Sinclair Broadcasting Group, E.W. Scripps, Tegna and Nexstar Broadcasting are among those counting on the two parties to pour money into TV stations in the 10 or so battleground states such as Florida, Virginia and Ohio.
Sinclair's current lineup of stations took in $254 million in 2012 ad spending and is looking for more in this cycle.
Although station group executives told analysts that they were still generally bullish about overall political ad spending for the year, they acknowledged that a Trump nomination is a wild card.
“He [has] obviously spent less right now than some of the others and it remains to be seen what he will spend by himself,” said Brian Lawlor, senior vice president for television and radio for E.W. Scripps, which is expecting to top $150 million in 2016 political ad sales for its stations compared with $143 million in 2012.
After touting Scripps as being well positioned to take advantage of political spending, Wells Fargo analyst Marci Ryvicker recently downgraded her rating on the company's stock. Trump was not cited as a factor.
Sinclair, which acquired stations in battleground states in recent years with the stated strategic aim of getting a larger share of the political ad pie for 2016, told analysts that it's hoping for the best if the Republican Party ends up with Trump.
“I would suspect that if [Trump's] the nominee, the [Republican National Committee] is going to have no choice but to back him, and the money will flow,” said Steven Marks, Sinclair's vice president and co-chief operating officer. “The prize is too big.”