• by Wayne Friedman , Staff Writer, July 3, 2008

The good news? Presidential candidates will spend more money on advertising than ever before. The bad news?  Automotive advertising, the largest TV station advertising category, is still weaving all over the road.  

While General Motors may seem to have regained some of its swagger in June -- maintaining its sales lead over Toyota Motor --  industry analysts believe all this is short-term news glow. One report from Merrill Lynch says that GM, still the biggest automotive maker in the world, could continue its overall slowdown --  possibly even toward bankruptcy.

GM reported an 18.2% drop in sales from a year ago in June. But it retained its traditional U.S. sales lead over Toyota, which posted an even bigger 21.4% decline.

Decline isn't a word local TV advertising station executives want to see. So instead, stations will cling to the news that more advertising dollars from political campaigns will save the day -- more likely, their year.

But what comes next?  In non-presidential, or non-political advertising seasons, local radio and TV stations, have been known to crash -- going negative. Next year, the Television Bureau of Advertising is estimating all local and national spot dollars will be down anywhere from 2% to 4%. And while stations' digital media efforts are growing at a high double-digit pace, they come off tiny advertising revenue bases and won't make a dent in quarterly results.

The reality is that many stations are pulling back, cutting local newscasts, laying off other production staffers. Tribune Broadcasting has been one of many local TV station owners doing this.

Back to the good news: Political network and local TV advertisements are expected to rise between 2% and 3% in 2008, while cable TV advertising is expected to rise 6%, according to ZenithOptimedia.  Estimates are that presidential advertising could go to $800 million, with $3 billion in overall political marketing.

Typically in political years TV stations expect overall double digit percentage ad revenue growth, which makes those single digit losses the following year look OK. The TVB 2008 estimates are that national and local TV advertising spot revenue will climb between 9% and 10%.

All this is a way for TV advertising trade organizations to talk up the "two year cycle" average, which hopefully ends with conservative to moderate single-digit average gains in the 2% to 5% range.

But the somewhat failing economy might make those goals tough to meet -- and high-spending presidential political campaigns only come around once every four years. Maybe.

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