Mary Beth Cahill, who spoke at Harvard University's Kennedy School of Government with Ken Mehlman, President Bush's campaign manager, said the Massachusetts senator's campaign initially thought there would be "no reach" to the ad from Swift Boat Veterans for Truth.
Instead, the ad, which initially aired in just three states, became a central issue of the campaign, eventually forcing Kerry to personally deny the group's allegations that he did not deserve his combat medals.
"This is the best $40,000 investment made by any political group, but it was only because of the news coverage that it got where it did," she said.
"In hindsight, maybe we should have put Senator Kerry out earlier, perhaps we could have cut it off earlier."
Mehlman said that it was natural that the ad had the reach and impact it did, because Kerry decided to make his Vietnam record a central part of his campaign.
"Because Senator Kerry was so focused on that part of his biography, it came out as an issue," he said.
Mehlman acknowledged that Democrats scored points against the president, such as raising the specter of a draft reinstatement, which got the attention of young voters.
"I think that was something that worked. It wasn't true, but it worked," he said.
The Swift Boat Veterans for Truth, a group of Republican-funded Vietnam War veterans who patrolled the same Mekong Delta in Swift boats similar to the ones piloted by Navy Lt. John Kerry, challenged Kerry's accounts of his medal-winning service and anti-war protests.
In the first ad, former sailors who served on boats near Kerry's in Vietnam said he lied about his war record. In a second, veterans criticized his subsequent anti-war activities. A third attacked Kerry for throwing away the medals he earned in Vietnam.
Cahill said the Swift boat ads show the power of news coverage, particularly cable news stations, which she said amplified the ads by running them repeatedly.
She said it was frustrating that the first ad continued to eat up so much air time even after the central allegations were debunked.
"For me, this was a very big change. The fact that it was disproved and it was still shown every day as part of the (campaign) coverage," she said.
Cahill said if she could change one thing about the campaign it would be the timing of the conventions. By scheduling their convention about five weeks after the Democrats, the Republicans gained a fund-raising advantage and dominated the news going into the final stretch.
"That was a huge hill to get over," she said.
Both sides agreed the debates were a crucial moment in the campaign.
Mehlman said he felt Mr. Bush was comfortable because he had gone through similar debates in 2000 and had gained confidence as president.
Cahill said Kerry practiced "mock debate after mock debate" and tried to avoid political zingers given the seriousness of the debates while the country was at war.
"This was not an election where 'You're no John Kennedy' was going to turn a debate," she said referring to a quip used by Democratic vice presidential candidate Lloyd Bentsen against Republican Dan Quayle in a 1988 debate.
Both sides also agreed that the Internet and other emerging news technologies have transformed the political process by making it more democratic and encouraging more people to become involved.