Don’t expect any ads for President Obama across the top of Prospect.org, the online incarnation of liberal monthly magazine the American Prospect. However warmly editors there may feel about him, it is blocking ads from his campaign as part of a pricing dispute that has pitted many political Web sites — on both the left and right — against their ideological allies.
The standoff is an unintended consequence of a broad shift in political advertising this campaign season. More money is going into online ads than ever before, with estimates topping $100 million. But much of this bounty is being distributed through advertising exchanges, such as AOL’s Advertising.com or Google AdSense, that serve as middlemen, bypassing the direct buys that long have been key sources of revenue for Web publications.
The ad exchanges have given campaigns greater precision in targeting voters — 30-something women in swing states who visit parenting Web sites, for example. But the exchanges also take a cut of every buy, leaving less for politically oriented sites in what once was their most lucrative season. They say the trend threatens to starve a diffuse ecosystem of online publications that nurture political conversation.
“I can get 20 cents on the dollar anywhere. I don’t need Obama to get 20 cents on the dollar,” said Ed Connors, advertising director for Prospect.org and the American Prospect. “We’re not going to put the Obama ads on the site on the cheap. If they want access to our niche audience, they’re going to have to pay full freight.”
The Obama campaign declined to comment for this article.
Surging spending on online ads has spawned a new generation of campaign consultants, skilled in new targeting tools and less inclined to spend money on Web sites merely because they support a partisan message. They are increasingly mimicking the tactics of commercial advertisers, which often aim ads not at particular sites but at certain kinds of users and whatever they happen to reading at the time.
This is made possible by cookies — bits of code created by Web browsers — that show advertisers basic demographic information on users and track them from site to site. Zac Moffatt, digital director for Mitt Romney’s campaign, said most of its online ads are bought that way.
“We’re not buying a site. We’re buying an audience,” Moffatt said. “The power of the Internet is targeting.”
Moffatt and other political operatives see this shift as part of the growing sophistication of online political advertising, which in previous elections was mainly a tool for fundraising and now is used to persuade and mobilize voters.
Campaigns are still making some direct buys from politically oriented sites and other online publishers, as Obama did by taking over much of the Web site for the Columbus Dispatch on Tuesday, when early voting began in Ohio. Obama also has bought ads on the Nation, the New Republic, Daily Kos and some smaller sites, said a campaign official, who was not authorized to publicly discuss media buys.
But the overall move away from direct ad buying has extended to unions, political action committees and campaigns at the state and local levels, depriving political sites of revenue they had expected. Ads that come through exchanges often pay between 5 percent and 20 percent of the price charged when sites sell ads directly.
“We’re talking $100 million on a campaign. Are you telling me there’s not $100,000 to spread around?” said John Amato, founder of the left-leaning CrooksandLiars.com. “We’re here. Hey, don’t forget us.”
He blogged about the issue last month in a post titled, “Democratic and Progressive Groups Now Advertise on Cheap Google Ads.” At the bottom of the entry was a plea for donations to help make up the lost revenue.
Ire runs particularly high against Google, which runs the largest of the ad networks. It has moved more aggressively into political markets in recent years, creating separate teams catering to Republicans and Democrats.
“As long as they continue to dominate, and as long as they continue to drive down the price, they will put free press out of business,” said Alex Treadway, senior vice president of sales for the Daily Caller, a right-of-center news and commentary site. “As a player in the market, it’s hard to compete.”
Google serves ads through its search engine, through display spaces it hosts on Web sites and through YouTube, the video site it owns, which has become an especially popular venue for campaign messages this year. Using the distinctive Internet addresses on computers, Google also can target users by state, congressional district, even Zip code, something not possible when a campaign buys ads on an entire site. Other advertising exchanges offer similar services.
“Google, and Google’s competitors in the advertising market, really see political advertising from both sides of the aisle as a revenue opportunity,” said Rob Saliterman, a former George W. Bush White House official who now leads Google’s Republican political ad team. “The industry, in general, has progressed by leaps and bounds from 2010.”
Other political operatives express skepticism that the loss of revenue from direct ad buys will drive politically oriented Web sites out of business, even if the shift hurts their bottom lines. “I don’t think you’ll see these political conversations go away,” said Chris Talbot, a former Google executive, now a Democratic political consultant.
For sites inclined to take a stand against the political ads flowing through exchanges, technology has a role in that, too.
Many sites have premium display spots and less-prominent ones that are filled by ad exchanges. They typically give sites control of the kinds of ads that appear in these spots.
Prospect.org has traditionally blocked pitches for alcohol, tobacco or gambling, said Connors, the advertising director. When it became clear to him that some campaigns were getting cut-rate access to the site through the exchanges, he decided to block one more genre — political ads.