The Complex World of Digital Advertising – Shannon Chatlos (Strategic Partners & Media)

Shannon Chatlos:

The call came in at noon. We were up at 6:00 PM on St. Patrick's Day and ran all weekend, and were successful on Wednesday. So as long as you have a relationship with your digital consultant, we'll take that call and we'll get it done.

Eric Wilson:

I'm Eric Wilson, managing Partner of Startup Caucus, the home of campaign tech innovation on the right. Welcome to the Business of Politics Show. On this podcast, you are joining in on a conversation with entrepreneurs, operatives, and experts who make professional politics happen. Our guest today is Shannon Chatlass of Strategic Partners and Media, a full service advertising and consulting agency based in Annapolis, Maryland. Shannon leads the firm's digital team serving clients that include political campaigns, associations, advocacy clients and corporations. In this episode, we discuss the evolving paid media landscape online, how it's changing the way campaigns are run, and her advice for selling into the political industry. Shannon, you and I have known each other for a long time, and I know you've been in this industry before that. So you've seen a lot of changes in the media buying landscape when it comes to digital. What trends have stood out to you when it comes to digital media buying in politics?

Shannon Chatlos:

I think one of the trends as, as everything has evolved is that digital is now one of your, the first considerations, right? I mean, I don't know about you, but I feel like when, when digital first became part of the, the, the, the media spend, it was kind of the redheaded stepchild in the back of the room.

Eric Wilson:

You got what, what whatever was left over. Yeah,

Shannon Chatlos:

Yeah. Whatever was left or, you know, a relegated 10% budget or something like that. And now I feel like, you know, one digital is at the strategy table. Any candidate or, or a campaign that we work with, I'm one of the first people on the call. They don't even wanna talk until I'm able to weigh in. So that's a, that's a, that's a change. That's an important change. And the other trend I would say is that, you know, Eric, I've known, I, we've known each other a long time and, and I, I, the words a digital expert drives me crazy because digital change is so much that that is a trend that is going to continue. It is so important that your consultant or whomever you're working with is constantly talking to vendors. So I think that's really important if someone's, if someone is looking to get involved in selling their, their service to us, like we need to be listening to them because the ad tech industry just changes so much. I'd also say that data is just, you know, it cont it continues to be so important that you're really working with really good data.

Eric Wilson:

Yeah. I think the thing that jumps out to me the most is the fragmentation, right? And all the different options. So, you know, when, when this was, was just getting started, it was like, okay, banner ads, right? We're gonna do some, some Google Ad Network buys with, with banner ads, and then we say, oh, we can do social media now and we can do pre-roll. And, and now it's, we've got a dozen different streaming services that we're tracking that have significant usage from, from voters. And you know, like it's just totally ballooned beyond one, one network or one, one platform,

Shannon Chatlos:

Right? And we're seeing, you know, the, the walled gardens, I think there's gonna be more of those going up, not less. The, the programmatic platforms rely on a, a lot of cookies and ipsas and, and things are changing. And I think that you're gonna see more and more entities like what Hulu's done. Like you, it's very difficult to get Hulu inventory on the exchange. So there's gonna be more and more places you have to buy direct, and that's going to be a challenge, and it's just getting more and more expensive. Also, I think people who obviously make up our audiences, they spend time on a lot of different platforms. I mean, there was a time when, you know, only a few handful of people were on Facebook or Instagram, and now, you know, really almost everyone is, or, or only a few people had cut the cord. Now either people are cord stackers or use several different streaming services. I've got a membership to all of them, right? So I just think it's gonna become harder and harder to find your target audience with efficiency if you're not, if you don't have a really large spend.

Eric Wilson:

Yeah. So I'm gonna go back and just explain some, some, some lingo to folks who, who are listening. The, the Waled Garden idea is that, you know, you, if you want to buy Hulu ads, you have to go to a representative from Hulu or go to their self-serve platform if the, if the company has one and say, I wanna buy based on these parameters. Whereas with programmatic buying, you can buy across different publications, different platforms from, from one interface. And, and so with, to, to your point with the, the data and the, the control and the privacy, more of these companies are saying, look, I I want to control the, the data and get the revenue. These, these streaming platforms are no longer lost leaders for, for the big, big brands that run them. And, and that makes our job difficult is, is campaigners, because you have to buy across multiple platforms.

And, and, and we don't necessarily always have the resources to do that. I think, you know, one of the, the key findings from our, our post-election polling with this center for campaign innovation was that you ba basically have, you know, voters divided into to three buckets. So they're the third who, you know, you can, are only reach on tv, they're not streaming. There's the third who are only streaming. And depending on the platform, you're able to reach them with ads. And then there's that third that, that have the both where, where you've gotta reach them. And then you've gotta figure out how, to your point, how do you get the frequency? It's not enough to just like, oh, we're gonna go out and buy Hulu. You may only get one impression per week off of, off of Hulu, but you really need to wrap it all together. And it's just gotten so much more complex.

Shannon Chatlos:

And, and it's, and no one's, it's not like one is less expensive than the other. I mean, right? I mean, it's your, you're, you're, it's, it's your have to buy all three in order to ha have efficiency. So that's the challenge. The budgets are just, you know, they're enormous.

Eric Wilson:

Well, speaking of budget, the, the question that comes up about digital advertising, every que conversation I have about this, I've had this question come up earlier this week. You know, what should my budget be? You mentioned the, the 10%. I'll give it an air quotes rule that we use to have. And, and now some people say that's 30%. How do you start to answer that question for a client of how much money should they spend on, on, on TV versus digital? Which platforms, that sort of thing.

Shannon Chatlos:

So to me, this is a classic math problem. So I like to start with who is our target audience and, and how many people make up that target audience or target audience is and then how many times we need to reach them, right? How, what do we think that that, how many times are they gonna need to hear that message for us to either go on to the next message or for them to have general awareness or education? And, and it really depends on what the goal of the campaign is, right? So, you know, but I'm talking in like, usually it's, we're just getting started. No one knows who I am, brand ID type name ID, and brand id. And then how does, how much does it cost to reach them X amount of times? And does that align with the budget?

Because everyone does actually have, you know, a, a, a budget number in mind, whether they say they don't or not. And then if, if it's not the right, if that's not the right number, then you need to adjust your target audience or your budget is that simple. So it's just a math problem. Now wh where, which platform can we find them on? That goes back to what we were just talking about, that it's extremely difficult. Like that is the big question. We do everything from surveys to, you know, I, I, Eric, some of the, the platforms I use, you actually can upload your audience and it tells you, it sort of shows you like, okay, they're here. Like we see, right? See, this is how many CTVs match that audience, or this is how many mobile devices match that audience. So then I start to know, or, or I can reach them online. And then I also like to be sure that we're thinking about, okay, who can we not reach? Can I have the data back that tells me that they didn't match in my programmatic system, and then I have to come up with a way to reach that, the, that audience. And that kind of gives you that one third only on, on broadcast number or you know, do we need to go knock on

Eric Wilson:

That? Or the, the people who are on those, the platforms that are not ad supported or don't allow political ads. And, and the, I think the, the, the challenge, the, the math also varies depending on where you're advertising. So in a place like the DC media market where we live you, you're probably gonna have to really rely on, on, on digital. Fortunately, you've got a lot more connected TVs, a lot more streaming than you might in, in other parts. And so it, it, it's not a partic perfect one size fits all number, like the, the, this idea of like, oh, well, 30% of your budget. Yeah,

Shannon Chatlos:

<Laugh>, that's a really good point. And, and you know, when you buy a, a lot of the broadcast buys what you're watching on Hulu Live or any of your, your, your live streams, that is a, that's a broadcast buy. So that gets very confusing too to people, you know, they're like, oh, I've, you know, I don't watch, like, when you're asking a poll, and like you're saying, we survey folks to find out where they're, where they're getting their media from, and they think that they don't watch any broadcast tv, but they have purchased

Eric Wilson:

It. Turns out they do. Yeah,

Shannon Chatlos:

They do. Exactly. So

Eric Wilson:

Well, and, and there, there's always been this tension between like digital buyers and, and TV buyers. There's mm-hmm. <Affirmative>, you know, it's sort of this idea that TV didn't wanna touch digital and digital, you know, was always trying to take money away from Tim tv. And I, I think the, it was <laugh> clearly happened to be true. I think where we have, we have ended up now is we need both, right? So, you know, I, TV broadcast undeniably has a role Yes. Getting more expensive and, and reaching fewer people, right? And so we have to supplement that, that with, with other things. And so again, going to that budget formula, you may, you know, you've gotta do tv, your media market may be very expensive, and you, you, your digital budget, it does not hit that 30%, you know? So it's, it's hard to do a formula like that. So, on the political side how would you rate Republicans paid digital efforts in 2022? Are we where we need to be in terms of reaching the right audiences?

Shannon Chatlos:

I don't, I, I, I, that's a, I see this as a two, two different answers. So on the point,

Eric Wilson:

All of your clients did it perfectly, everyone who else, everyone can work with you, everyone. We were perfect. That the answer, the two prong ok,

Shannon Chatlos:

<Laugh>. Yeah. So I think, I think to, to your earlier point of making sure that consultants are not fighting over budget. I mean, I, that is, that is really important. We, at our firm, we are integrated, so mm-hmm. <Affirmative>, if I find that like there's a lot of success in one area, or that we really need to be up on these certain platforms that are more expensive, and I can go and say, Hey guys, can we reallocate some of the TV budget or, you know, maybe come down on the weekends and shift that to digital or whatever it is, we can have those honest conversations. So, and it's all under one roof. And that helps with, you know, that's very helpful, very helpful. And that's not always happening. And so, you know, that's a problem. So that's, and, and I don't think that's a Republican problem.

That's just a problem. Right. And then as far as are we reaching our target audiences? There's so much data in the programmatic platforms, I don't think people realize, like, you know, as you're, as you're layering all this data in, and you're, and you're segmenting out, you know, you're buying some programmatically, you're buying some direct, you're buying some on, on Facebook and on YouTube, and you're, so, your reach and frequency is not completely transparent. So is there waste? I think there is. I think there is. How do we solve that? That's up to, to really smart people and data scientists to help us figure out <laugh>. But again, back to the wild garden problem, do I think that's gonna be an easy one to solve? No, I don't.

Eric Wilson:

Right. We don't, we don't know who, who, who is who. And, and you know, we had Keith Norman from PreOn mm-hmm. <Affirmative> on the podcast a couple weeks ago talking about O T T C T V, and, and I put the question to him of who should be buying this? And, and you, you know, he, he was very diplomatic about his answer. But I think you, you highlight one of the benefits of going with a, a hybrid firm that knows TV and knows digital because it's not one or the other. Yes. The content, the, the creative is, is tv it's being displayed on the big screen in the, in the home, but the targeting and the, the metrics that you get back, yeah, yeah. It's digital. And so it, it really does you know, helped have it in, in one place. And you don't, you, you kind of avoid that tension of, well, if I shift my budgets accordingly, then my firm loses and your firm gain kind of thing.

Shannon Chatlos:

Right? And you also just wanna be able to do it smartly. So you want, like, I, we should be sharing those metrics and, and, and the, what we're seeing on an O T T platform. Like, let's imagine, you know, your, your O T T completion rate was a 70. Well, that means people are literally like turning off the ad. And don't you think the TV buyers would wanna know that <laugh>? I mean, you know, like, Hey, this ad's not working, or, you know, this ad's really, really great. Go ahead and run the 60, you know, right. Like burning the message even more. So I think those conversations are really important. You can use the metrics to influence your broadcast by as well. Yeah, I mean that's, that's just doing things, the, the, the right way, working together as a team and communicating.

Eric Wilson:

So it's March, 2023, the, the rest of the country's watching basketball, but that means we're getting ready for the 2024 presidential race. It's looking like another crowded primary on the Republican side. So what are some paid media tactics or strategies that you think presidential contenders will be be using to stand out or, or, or differentiate themselves?

Shannon Chatlos:

I think, I think going local, getting more local is gonna be really important. I think, you know, paying attention to what, what, what people are talking about and running ads contextually is gonna be really important. Certain communities are much more in tune with gas prices, for example, than others. Or maybe you know, in Ohio with all of the, the, the railway stuff, you know, right. Being sure that you're, your, your, if your ad is talking about that, can you align yourself within an article that is talking about infrastructure? Cause there's lots of them in there, right? So I think getting local and using contextual in a really smart way to make your buy more efficient is gonna be something that they should be thinking about to stand out and, and, and be less cluttered to be more relevant, right? So you're on the local pub that's talking about a local issue when you're talking about, you know, changing up leadership. I think all that makes a lot of sense.

Eric Wilson:

And not just the message, the, but the, the, the visuals and, and so much personalization.

Shannon Chatlos:

Yeah, you can like, and, and making it, you know, if you're talking about leadership change to, to voters somewhere that's, you know, knowing what they've been going through lately is gonna be really important, I think. So, so using those kind of tactics to make your, your ads even more personalized in an authentic way. Not in, like, we made, we made 400 ads and we're gonna optimize to the best performer. You know, like really taking time to make sure that the creative stands out, I think is gonna be really important. Remembering that, that what's old could be new again, right? Tele-Town halls you know, they, they work really well. And people, you know, I think the pandemic kind of changed the way that we, we actually appreciate longer format content sometimes now. Definitely. And, and I think that taking time to really communicate people are, are, they want that. That's why I believe podcasts have become so popular because people want to go to dig deep and go deep, and people appreciate that. So I think that's something that should be used.

Eric Wilson:

You're listening to the Business of Politics Show. I'm speaking with Shannon Chalos who leads strategic partners and media's digital practice. Shannon. Meanwhile, you know, we, we've got the presidential race going on. We, we've got issue advocacy both at the state and federal level. What role are you seeing paid digital playing in those policy fights right now?

Shannon Chatlos:

Yeah. you know, so this happens. We, we do a lot of this actually, and it's just the ability to take action really quickly when things aren't going well, or, or hopefully they are going well, but, but more often they're calling us because they're like, all right, this bill is, is about to, to be passed or, or not passed, and there's these eight legislators that are holding out, what do we do? And digital can step in and make a huge impact. Anything from like a creative that has the actual, like senator that's about to vote nos face on it that says, tell Senator, you know, X to, to, to vote to support this bill. And put a lot of pressure on them. We've been doing, you know, robocalls into the office again, like what's old is new again. Because it's digital. We, we can, we can pull the actual data file and, and use that to target, but we've been, we've geofenced folks homes blown up their neighborhood with digital ads to just their neighbors, which can be very distressing to, to, to a legislator who's, who's needs their, their neighborhood support, right? So that's the kind of stuff. So

Eric Wilson:

Is the, the, the advantage with digital on that is that it, it, it's, there's precision and it's, it's quick turnaround time. Is that, that why it's so valuable in those, those contexts?

Shannon Chatlos:

Yes, because we, like, we got a call on Friday to make a difference that for a vote this Wednesday, the call came in at noon. We were up at 6:00 PM on St. Patrick's Day and ran all weekend and we're successful on Wednesday. We also did robo calls Monday and Tuesday into the office. So, you know, I think that is a very quick turnaround, and as long as you have a relationship with your digital consultant we'll take that call and we'll get it done. Right.

Eric Wilson:

Right. Not enough time to send mail, not enough time to cut a tv Yeah. And get it in rotation.

Shannon Chatlos:

That, that's, and you know, that's a really good point. So I think it's really important that, you know when people are looking for a digital partner, you need to ask questions like, Hey, what's the, what's, what resources do you have in-house? Do you have, do you have a graphic design artist? Do you have someone that can build a landing page quickly? Like, what's your turnaround time for things? That's a, that when you're, when you're interviewing your consultants, those things need to be sitting in the same room because Right. You, otherwise you can't, you can't turn things around that fast.

Eric Wilson:

So obviously with the, the boom around o t t over the top and connected TV advertising seems like all the focus in paid, paid digital is around video. But what are you seeing in terms of other formats in creative? You've mentioned robocalls and tele-town halls already are, are there other paid formats that are, are important right now?

Shannon Chatlos:

Well, yeah. I mean, not everyone can afford a video. And not everything calls for a video. And you also have to remember that if you're looking for call to action and you're trying to, you know, drive acquisition or drive engagement on something, o t T and CTV might not be the best choice. Because, you know, you're not clicking through to a landing page as you're watching Ted Lasso, right? So, you know, I think, I think each, each form of digital, the question is what needs to happen when someone sees this ad? So I think that the, the format of the ad or the creative used has to ultimately be accountable to that question. So do we need people to go to a landing page to learn more and sign a petition? Do we need someone to donate? So I think that, that there, there's a place for video and, and, and especially in that top of the funnel, but as you get, as you get through that funnel, then that's when you know you, you're gonna have to use ads. That engagement is, is easier on now. I am seeing a ton of QR codes on, on the ott.

Eric Wilson:

Yeah, I'm hearing that a lot

Shannon Chatlos:

Too. And it's nice cuz you can pause it, right? Like, we all know how to do that now we know how to pause it and, and, and snap the, the the QR code. I did it this morning when I was watching the Today Show. So

Eric Wilson:

I really like text messaging too, like that that short code text messaging is a, is a good bridge. So speaking of measurement, obviously one of the benefits of digital is that we can measure and track everything sometimes to our detriment. Is there a metric that you would add that's on your wishlist that you think is, is the most valuable insight that you could, could gain?

Shannon Chatlos:

I think you and I were talking about this about a year ago, right? Like I was saying, like, Eric, have you found anybody that can do this? But it, I would say competitive is one of the missing metrics,

Eric Wilson:

Being able to see what other people are doing.

Shannon Chatlos:

Exactly. Digital is still such that the, you know, Facebook has their transparency platform and Google and smart people like you have been able to put those things together into a dashboard that we can see, but I still can't see how much someone's running on a programmatic or how much someone's running on a platform, an O t t walled garden or I, it's just, it makes it very hard for, for us to say, like, how much are they spending on O T T or ctv

Eric Wilson:

Mm-Hmm. <Affirmative>. And just to contextualize that for listeners real quick, Shannon, you know, when it comes to broadcast TV and broadcast radio, the TV stations as part of their federal Communications Commission license are required to publish Who's spending, what, what are they advertising? And so for, and then that, that carries over in some extent to cable zones. And so to our, our friends in the TV world, they ha they, they were able to go to the campaign manager, the general consultant, the candidate once a week and say, look, they're spending this much money against you, and here's what they're saying. Whereas in digital, we don't have that. Because, you know, some of it's on Facebook, some of it's on Google, some of it's on these ad exchanges, some of it's on, you know, name all the different platforms. And, you know, because they're private enterprises, they're not required by the government to share that information,

Shannon Chatlos:

Right? So that's still my, that's my number one wish. And you know, again, I think this has been the theme of this, this conversation we're having, but right, <laugh> fragmentation causes problems, and that's one of, you know, competitive on the digital side in this super fragmented digital landscape. It's a problem. And it would, I would love for it to be solved.

Eric Wilson:

I do think, and I'm curious to hear if, if you, if you agree that acr, the automated content recognition that we're seeing on, on Smart TVs is, is starting to help. Because we can know if an ad was still doesn't get us, it's starting what, what, you know, the spend. But yeah, I think it's starting to help.

Shannon Chatlos:

It's starting to help, but it's still, again, like I feel like it's still very, like fra it's just fragmented. You, you'd have to go to so many places, it, it'll happen. I mean, and the other, the other thing that's going to happen, and I I'd love to, I think it's gonna happen, so I'd love to know if you think the same is, is it's only a matter of time before we buy tv, like we buy digital mm-hmm. <Affirmative> broadcast television. I mean, it's, it's going to change and, and it's going to, everything's going to move towards, you know, the, the CPM and the streaming model. That's what I see.

Eric Wilson:

You start to see how in the political space, how we buy ads and, and build plans. It's all around audiences, right? So at a certain point, from a strategic perspective, you don't care where the person is seeing the message, you just care that the right person is seeing the right message that's right at the right moment. And, and so it is a little bit different in, in commercial advertising by the way, because, you know, I, I can buy Tide every day of the week. I can go to any store and buy Tide. It's not like, you know, I have to vote on this day and I can only vote for these people where we the audience and, and where they live matters a lot. So we do have a kind of unique challenge there, but I think you're right. It, it's, it's definitely you know, the more data, the more processing power we get, we can sort of say, look, we're, we're buying audiences, not necessarily, you know, there are people who still owe buy, oh, I wanna buy the, the evening news, and that's my strategy, right? It's not about the audience that, that may be the right thing to buy, don't get me wrong.

Shannon Chatlos:

Right. That, you know, the, the for consumer goods too. I mean, they, they can measure, you know, marketplace attribution and they can measure mm-hmm. <Affirmative>, you know, they have, they have, we measure on election day,

Eric Wilson:

Right?

Shannon Chatlos:

<Laugh>. So we don't have the benefit of seeing our a a lift in sales. I mean, we have our polls and we have things that can indicate the right direction, but at, at the end of the day, you know, the point of sale is election day.

Eric Wilson:

All right, Shannon, I don't wanna let you leave without getting some advice from you. You've been a, a sales leader for as long as I've known you. And, and selling for me isn't something that comes naturally, nor is it to a lot of folks in our industry. You know, you get into politics for, for some reason or another, but then you eventually find yourself in sales. What's the most impactful thing that an entrepreneur in this political industry could do to be more effective at sales?

Shannon Chatlos:

This is a relationship business. And so we care. I care very much as someone wants to really understand what I'm working on and take the time to learn. Like this is, this is the campaign that I have, and what, what is your, what are you selling that could create that, that could create solutions for me. I'm always looking for individuals that have enough political acumen that they can become a strategic advisor to me as well, and make me smarter. I'm always looking for differentiation. That's the most important thing because, you know, I'll get, you know, requests for meetings, but if you can quickly tell me, you know, like, Hey, you need to look at this because this does this different, or this does this better, or you're first best or only in a certain category, then I wanna hear about it. So I think taking the time to really lead with your differentiator is important. Mm-Hmm.

Eric Wilson:

<Affirmative>. Yeah. Well, that's a, a, a good note to end on. With that, I'll say thanks to Shannon for a great conversation. There's a link to Strategic Partners and Media in our show notes. You can see about more about their work. Get in touch with Shannon if you're interested in continuing the conversation. And if this episode made you a little bit smarter or gave you something to think about, you know that all we ask is that you share it with a friend or colleague and you look smarter in the process. It's a win-win for everybody. Please remember to subscribe to The Business of Politics Show wherever you listen to your podcasts. That way you'll never miss an episode. You can also get email updates if you want, at our website, business of politics podcast.com. With that, I'll say thanks for listening. We'll see you next time.

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