In 2020 race, Facebook winning the money game — again

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With the next debate looming, the field of Democratic presidential candidates is thinning fast, down from an eye-popping 23. And the only people who see a downside probably work at Facebook.

The unusual Democratic nominating process, made necessary by the large field, has delivered a financial windfall for the giant social network. As of early September, Democratic candidates had spent $29 million on Facebook advertising aimed at boosting their poll numbers and attracting new donors. That’s nearly 3½ times the $8.4 million Democrats spent on Google’s massive advertising network and the video service YouTube.

And even though President Trump faces no meaningful competition from his own party, he too is spending massively on Facebook — over $17 million so far, compared with $8.3 million for Google ads.

“It’s a necessity of politics that you be on Facebook now,” said Matt Corridoni, press secretary to Representative Seth Moulton’s unsuccessful presidential run. “Republicans are doing the same thing.”

It’s also a pretty ironic outcome, given the temperature among Democrats toward Facebook these days. The company is no longer the darling of Democrats, who used its vast troves of personal data to great effect in the successful campaigns of President Barack Obama.

These days, Democratic leaders are still angry about how Russian agents exploited the company’s policies to run ads to influence the 2016 elections. Some in the party are denouncing Facebook and other Internet giants as dangerous monopolists, while among presidential candidates, Massachusetts Senator Elizabeth Warren has called for antitrust action to break up Big Tech.

Yet despite the attacks, Democratic presidential candidates have flooded Facebook with ads — and money — thanks to the party’s own primary debate system. To appear in the televised debates, each candidate has to have a certain level of support in the polls, and a minimum amount of small-dollar donations; for Thursday’s debate, the threshold was 2 percent in four major opinion polls, and donations from at least 130,000 donors, with 400 each from 20 states.

According to campaign officials and political consultants, Facebook is, by far, the best tool for rounding up those thousands of donors.

“The reason Facebook is such a powerful platform is that people volunteer all this information about themselves,” said Reid Vineis, vice president of the digital ad firm Majority Strategies, which works with conservative candidates.

While all the major social media sites base ads on an individual’s online behavior, Facebook takes much of the guesswork out of it for advertisers. Millions already use it to talk about their fondness for one candidate, or dislike of another, so political ads can be aimed at exactly those voters most likely to respond. In effect, buying ads on Facebook should generate more bang for the buck.

If only. In fact, the cost of reaching an individual via Facebook is soaring, because so many candidates are vying for their support — as much as $100 in ad spending for every $1 in donations. And that means an even bigger payday for Facebook.

When you log onto Facebook, the ads you see are chosen through an instant automated auction. You see the ad of whichever advertiser paid the most to catch your eye. Voters spend only so much time online, and Facebook shows only a limited number of ads. So the competition for your attention is always ferocious.

But when nearly two dozen politicians all want to show their ads to the same audience of left-leaning voters, you get a bidding war, and much higher auction prices. Hence the $100 to $1 ratio cited in some press reports.

Jeff Greenfield, cofounder of C3 Metrics, a digital marketing firm in Portsmouth, N.H., said that when it comes to big Facebook ad buys, “the spend does not justify the means.”

Compared to Facebook, “the cost to reach a thousand people in radio and TV is actually less than the digital realm,” Greenfield said, so the campaigns’ heavy reliance on Facebook “just shows you that they’ve got a lot of money and they’re not smart with it.”

Moulton spent only $208,000 on Facebook ads before halting his campaign in August after falling short of the polling and fund-raising thresholds. Corridoni said Moulton’s late start, in April, meant that most of the available donors on Facebook had already chosen sides.

”That social media audience doesn’t get larger, but the number of candidates competing for their attention does,” Corridoni said. “We should have gotten in earlier.”

By contrast, Josh Miller-Lewis, digital communications director for the campaign of Vermont Senator Bernie Sanders, said the rules of the Democratic primary are tailor-made for his candidate. After all, Sanders used small donations collected via the Internet to launch his unexpectedly strong presidential bid in 2016.

“Because of his understanding of social media, he was able to build this massive following,” Miller-Lewis said. “It started on Reddit. It started on Facebook.”

So far this time, Sanders has spent $3.2 million on Facebook, more than any other Democrat except billionaire candidate Tom Steyer, who has spent $4.1 million. Miller-Lewis says the investment has paid off. “We’ve had hundreds of thousands of donations from day one,” he said.

As for the 10 Democratic candidates who haven’t cleared the debate threshold, there’s always October. If they can bring up their poll numbers, and round up 130,000 donors by the end of September, they’re in. But these candidates are short on time, and most are short on cash, making it unclear whether they can use Facebook ads to buy their way into the next debate.