Mike Bloomberg is outspending his rivals in the 2020 presidential race in campaign ads. For Facebook (NASDAQ:FB), the update is great news. Bloomberg is spending big on Facebook platforms. Currently, he has emerged as the company’s top political advertising client.
With a net worth of more than $62 billion, Bloomberg has deep pockets to fund an expensive campaign. He made a late entry into the Democratic presidential nomination race in November last year. As a result, he’s spending a fortune to catch up with Democratic rivals who are ahead in national polls.
Facebook benefits from Bloomberg’s deep pockets
Bloomberg has spent $42 million on Facebook campaign ads since he joined the presidential race. So far in 2020, the Bloomberg campaign has spent $36 million on Facebook ads. He’s ahead of all the 2020 presidential candidates, including President Trump. So far, the Trump campaign has spent $6.0 million on Facebook ads in 2020—second after Bloomberg.
As Bloomberg floods Facebook with political ads, Axios reported that President Trump’s campaign is allocating less for Facebook. The campaign is diversifying to other platforms beyond Facebook. President Trump’s campaign used to be Facebook’s top political advertising client. The campaign spent big on Facebook ads during the impeachment proceedings.
Tom Steyer is another important client for Facebook’s political ads. So far, he has spent about $6.0 million on Facebook campaign ads in 2020.
Revenue from campaign ad sales in 2020
Advertising is Facebook’s main business. However, selling campaign ads isn’t a big business for the company. Still, Facebook is on course to make some good money from campaign ad sales this year. The company expects campaign ad sales to contribute about 0.5% of its total revenue in 2020.
Facebook’s annual revenue hit $70.7 billion in 2019. Wall Street expects about $86 billion in revenue in 2020. Therefore, 0.5% of revenue from campaign ads sales would be about $430 million for Facebook in 2020.
In addition to Bloomberg’s deep pockets and his campaign liking Facebook platforms, there is another advantage for the company during the election cycle. Some of Facebook’s major advertising rivals decided to stop selling 2020 campaign ads. As a result, there’s limited competition for Facebook in the political ads market.