Media

How an Advertiser Boycott Campaign Helped Push Glenn Beck Off the Air

How much sooner would Fox have been forced to drop Beck if the media had done its job and forced News Corp to explain why it was propping up someone who's bad for business?

When we launched our campaign to hold Glenn Beck accountable for his vicious, baseless, and repeated race-baiting in July 2009, it was based on a simple theory: Beck's rhetoric was so egregious, so far over the line of decency, that few advertisers would want to associate their brand with Beck. If we could convince advertisers to abandon Beck's show, and stay away, this would make Beck a financial liability for Fox News Channel, ultimately leading to his show's demise.

The theory proved true: 285,000 people signed our petition to Beck's advertisers, and hundreds of major companies made sure their ads would not appear during his show. Beck could not attract major advertisers for more than a year, so demand for ad space (and hence, the price of ads) on his TV show plummeted, hurting Fox's bottom line. Eric Boehlert of Media Matters explains it well:

 

The television industry is built around supply and demand. Glenn Beck has supply in the form of roughly 20 minutes of advertising time sold each episode. And it wants to build demand. Usually, healthy ratings drive that demand since advertisers want to reach the masses. But if suddenly hundreds of advertisers raise their hand and announce they'd be happy to spend money with Fox News, but not on Glenn Beck, then the show's demand plummets, but the supply — the 20 minutes of advertising inventory — remains the same.

Boehlert quotes an ad buyer who backs up this analysis, saying: "Ad rates are predicated on supply and demand, not ratings. If the show has low demand and an oversupply of advertiser inventory, the show will not get premium ad pricing no matter how many viewers." In some of our conversations with advertisers during our campaign, we heard that this was exactly what was happening. Representatives from one small company told us that they bought time during Beck's show because it was so inexpensive they couldn't pass it up.

But even as our campaign grew more successful — as the number of dropped advertisers grew from three to a dozen to more than 300 — many media commenters succumbed to the lazy conventional wisdom that our campaign could not generate the financial pressure necessary to dislodge Beck. Some, like CNBC's Jim Cramer, bet that Beck's mighty ratings would entice advertisers to return. He had this to say about the campaign back in 2009:

 

Unlike his colleagues on sister network MSNBC, Cramer didn't portray Beck as a racist hatemonger and said that eventually all the advertisers forced away from his program would come back.

"So my take is that advertising worked, but it only worked if you're not – I mean look, I think, I used to follow Glenn Beck when I had a radio show," Cramer said. "He's a nice guy, Philadelphia and I've been on his show. You know — I think they all come back in the end."

The goal of the boycott, instigated by Color of Change, was to hurt Beck and Fox News' advertising revenue. However, according to Cramer the campaign was failing and NewsCorp was not struggling in any way from the boycott.

While Cramer's opinion was based in little more than uninformed speculation, others in the media accepted the idea that the campaign would not hurt Fox financially for a far worse reason — simply because Fox News said so. As we attempted to document and estimate the impact of hundreds of advertisers refusing to advertise during Glenn Beck's show, Fox News assured everyone from reporters to NewsCorp shareholders that the boycott was having no impact on the network's bottom line. Of course, Fox refused to open up its books to scrutiny to verify this. And many reporters accepted it without digging deeper. For instance, Mediaite's Steve Krakauer, in a piece entitled "Sorry Haters: Fox News Still Unaffected By Beck's Lost Advertisers," wrote:

 

Two differing opinions – and Fox is very likely in the right. While companies are pledging to boycott Beck's show, two simultaneous events are occurring. First, Beck's show still has advertisers. They may be "Beachbody (creator of P90X Exercise Equipment), Egg Genie and Telebrands (creator of Jupiter Jack)" as Rucker points out in the press release, but they are still there. Beck's program continues to draw enormous ratings, and advertisers must pay for the wide audience. And it's not just a month-to-month comparison. When looking year-to-year, FNC at 5pmET is drawing well more than double the amount of viewers it was in 2008 (when the program was America's Election HQ) – and at times nearly three times as many.

Krakauer asserts that because Beck's ratings are high, even his second-rate advertisers must be paying a premium to reach his "wide audience" — this simply isn't true and ignores the law of supply and demand explained above. He continues:

 

The other point is, Fox News is still not being boycotted as a network. These "industry sources" that estimated the loss figures for ColorOfChange very likely didn't talk to the FNC ad sales department – because the loss for the network couldn't possibly be anything close to the numbers estimated. While companies can request not to be included during Beck's hour, by spreading their advertising over the rest of the FNC day and prime time, they are still paying a hefty premium.

It's an admirable effort to get nearly 200,000 signatures of support, and continue to tally up companies refusing to touch Beck's program and rhetoric. But to say it's affecting Fox News is a mischaracterization. It's just not...yet.

Krakauer's argument falls flat in several ways. First, he presumes the word of the FNC ad sales department is to be trusted, and he assumes he knows what they'd say without even attempting to get word from them or directly researching the point on his own. And when he says that Fox hasn't lost money because advertisers have moved their ads to other Fox programs, he's basically repeating a Fox talking point that doesn't hold up when you look at how advertising on TV actually works. While orders made for ads during the first months of the campaign could be moved elsewhere on Fox, the spots would have to run in other ad space that couldn't then be sold — thus costing Fox money. And when new orders started to come in, because Beck's show was prohibited by major advertisers, Fox had less high-value inventory to sell, and thus less revenue.

It's also important to note that our campaign was intentionally focused solely on Beck and not about pulling advertisers away from Fox News altogether. The point was to diminish the ad value on Beck's show, making Beck a financial liability for Fox and creating an opening for industry analysts and shareholders to begin raising questions about why Beck was being kept on the air.

To be fair to Krakauer, he was by no means the only media reporter who didn't take the time to investigate how the price of advertising is determined on television — much of the media coverage at the time ran Fox's statement in response to the advertiser pullout without questioning it: "The advertisers referenced have all moved their spots from Beck to other day parts on the network, so there has been no revenue lost."

Fast-forward 20 months. Beck is now on his way out, and the conventional wisdom has actually shifted — most of the current coverage of Beck's departure from cable news has noted the advertiser exodus as a significant factor. But some reporters still parrot Fox's talking points, without digging into their logic, blindly taking the channel's denial of any financial impact as the truth. For example, Politico's article:

 

But it's not clear that the advertiser boycott had much to do with the breakup. Last year, when an analyst asked News Corp. chairman Rupert Murdoch how long Fox would "subsidize" Beck's show, which was "filled with house ads," Murdoch stood by his man, the Los Angeles Times reported.

"It's not subsidizing the show at all," Murdoch said, adding that Beck gave "a terrific kickoff" to the Fox News evening lineup.

Unfortunately, too many in the media are still all too eager to take enterprises like Fox News Channel at their word without doing independent research and demanding hard evidence to back up their claims.

We knew all along that if we could make sure advertisers stayed away from Beck, it would eventually catch up with Fox. And it has, finally. But we'll never know how much sooner Fox would have been forced to drop Beck if the media had done its job and forced Fox and News Corp to explain why they were propping up someone who is bad for business.

James Rucker is an American social entrepreneur and co-founder of Color of Change.