Battle in Seattle: ‘Indie’ West Seattle Blog vs. Corporate KOMO | Street Fight

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Battle in Seattle: ‘Indie’ West Seattle Blog vs. Corporate KOMO

18 Comments 01 December 2011 by

Seattle is arguably the most hyperlocalized metro region in the country, with more than 100 community sites in and around city. But one community is the crucible for what is shaping up as a dug-in competition for eyeballs and dollars that may have implications for hyperlocals everywhere. That community is West Seattle, a peninsula jutting into Puget Sound that is rich in nature, heritage, and civic involvement.

West Seattle has two major hyperlocal news sites, and they represent 180-degree-opposed forces in online community news: independent sites that entrepreneurs fund from their wallets, and big-media-financed sites that draw on millions of dollars from corporate treasuries.

The independent West Seattle Blog was founded and is run by Tracy Record (co-publisher and editor) and her husband Patrick Sand (co-publisher and business director), both of whom have strong news backgrounds.

Meanwhile, West Seattle KOMO is one of the 55 neighborhood sites in metro Seattle launched by local television station operator Fisher Communications, with  tech and advertising support from Seattle-based Web middleman Datasphere. The site has one full-time staff reporter, Rose Egge, a West Seattle native who, though only 25, has three years of journalistic experience in the area. Egge is backed up by other KOMO news staff.

Record, who is deeply embedded in West Seattle civic life and widely admired in the independent hyperlocal community nationwide, says, “There is no room for the corporations in here if they’re going to be templatized and cookie-cutter – which is what Patch and the Datasphere sites… have done.”

Gary Cowan, SVP of marketing and sales at Datasphere, is unfazed: “This is not a winner-take-all-type market. Some of our most successful community sites are those where other players are also strong. Scale is the future of hyperlocal.”

So how do these two hyperlocals with such totally contrasting visions stack up in serving the same, Web-savvy community? To find out, I examined a week’s worth of their West Seattle coverage (Nov. 19-25), looking at the type and amount of content and the community feedback it received.

WSB published more than twice as many articles as KOMO, and covered more topics (e.g., government, transportation and nature). WSB was also superior in audience engagement, with some of its stories attracting 15 to 20 and more comments.

Driving WSB’s numbers is its heavy use of social media — far more than West Seattle KOMO:

  • On Facebook, WSB pulls 5,209 “likes” compared to KOMO’s 132, and 509 “talking abouts”  to KOMO’s 2.
  • On Twitter, WSB has 37,908 tweets compared to KOMO’s 3,334, and has 11,957 followers compared to KOMO’s 341.
  • On its Forum, WSB’s open discussions have attracted 77,580 posts to the 7,319 topics.

WSB’s strong engagement with its users goes straight to the bottom line. The site’s 75 display ads — all small squares bought by local merchants — are behind Record’s 2009 assertion that revenue is in the “six figures.” WSB’s revenue surely has been increased by the site’s rapid increase in traffic in recent years.

West Seattle KOMO runs about 55 small display ads from local merchants. Datasphere wouldn’t disclose revenue from those ads, but Fisher’s 125 Web sites generate  about $5.6 million revenue annually, based on a projection of results in the company’s third-quarter 2011 report. That averages out to about $45,000 per each Fisher site. Is that enough to cover costs? Cowan says current advertising revenues make West Seattle KOMO and Fisher’s other 119 community sites “sustainable.”  He adds: “Why do you think the cost of running one of these sites is anywhere near close to $45,000? Remember, the basic premise of our approach is that we leverage existing assets and spread fixed costs across a large new base. Yes, there are definitely incremental costs associated with setting up and running these sites, but nothing like what would be required to set up and run a single standalone site as a compelling business.”

In short, KOMO expects to benefit from the network effect, which West Seattle Blog’s independent-minded Tracy Record happily rejects.

Pick your winner.

Tom Grubisich authors The New News column for Street Fight. He is editorial director of LocalAmerica, which is developing a Web site to rank communities on their livability across 20-plus categories. The rankings will be dynamic, going up and down daily as they are updated through a combination of open data, journalism and feedback from local experts and users of the site.

  • http://twitter.com/benilfeld Ben Ilfeld

    Network effect definition: “In economics and business, a network effect (also called network externality or demand-side economies of scale) is the effect that one user of a good or service has on the value
    of that product to other people. When network effect is present, the
    value of a product or service is dependent on the number of others using
    it.”

    It would seem by your numbers that Tracy is happily benefiting from network effect with her larger and more engaged local community while KOMO is struggling to build a network of engaged locals.

    It would also seem that the size of each operation works to the advantage of each. Tracy’s goals are quite different than Datasphere’s goals. Tracy’s operational scale helps her maintain the best connection with her community while Datasphere has been successful raising funds by scaling technology and tele-sales. Each is a success story in their own arena.

    • http://www.facebook.com/tomeditor Tom Grubisich

      Ben,

      You make a good point that WSB has its own network effect, but will it work as well with regional advertisers as it does with community-based ones (which WSB has captured so well)?  What happens if and when KOMO succeeds in building enough engagement to make its 55-community Seattle sites attractive for clustered buys by regional advertisers (e.g., health cares, supermarkets and others fighting for a marginal market edge)?  Those advertisers, if they go with KOMO, may decide to add WSB to their buys, but that’s not axiomatic if KOMO should be in the driver’s seat.

      • http://twitter.com/benilfeld Ben Ilfeld

        2 responses:

        1. As we run a regional ad network, SLOAN, here in Sacramento I can tell you that regional buyers do exist and there is a market for that kind of reach.

        What that might mean for WSB or KOMO? I have no idea. WSB would be the perfect leader for such a network because it has the engaged local audience that makes premium pricing possible (you can’t afford to run that kind of network for $1CPM). At this point, KOMO has more than just an engagement hurdle for that kind of network.

        The most significant hurdle is actually the technology and sales process. KOMO is working with Datasphere. The ads you see on these sites are sold not by KOMO, but by Datasphere through a phone bank to small business. If you do research (I recommend you write about it) about how Datasphere prices and sells ads you will find they are positioned to help TV stations like KOMO attract local advertisers who are usually too small to make them worth a call from the usual TV ad sales team.

        The other significant hurdle is something that TBD ran into in DC. They ran an ad network of highly engaged blogs out of a TV station, but there was no dedicated digital sales staff. this meant that sales people who were more familiar with broadcast and made more commission selling TV ads had no real incentive to sell the network – so it didn’t sell.

        KOMO might be able to overcome all of these challenges if they wish and if they put up the resources. Datasphere could see an opportunity and change how they do business for more of a regional focus. WSB could decide to form an ad network with other sites. But that is all just hypotheticals.

        I imagine in the short term KOMO would be happy just having incremental revenue from businesses they used to not sell to at all through Datasphere and there will be no great increases in the quality or engagement on their sites. And that won’t really present a problem for KOMO or Datasphere unless churn rates for advertisers in their original markets get unmanageable.

        Knowing the folks at WSB, I think they would prefer to deepen their relationship with West Seattle while providing better services for advertisers and benefiting local small businesses rather than risking the headache of running a network and diluting small local ads with regional ones. And I highly doubt that WSB would ever join a KOMO led ad network. Just my 2 cents.

        Whew!

        2. What I meant to point out was that the term “network effect” does not mean advantages firms get from scale whether on the cost or revenue side of the coin. It refers to advantages users get from being connected to a community of other users. Firms do have the ability to build business plans to capture some of the value created, see: Facebook, The.

        As I looked at the situation you described above, WSB likely does benefit from network effect in that its users are engaged, likely know each other and trust both WSB and each other – all in a local news ecosystem with WSB as the firm at the center of the action. On the other hand, it would seem the KOMO site you described does not provide this kind of extra value for it’s users at this time.

        Not everyone has to benefit from “network effect.” This does not make or break the business plans of WSB or the KOMO site. And as I mentioned above, I think both Datasphere and WSB have been successful to date – maybe the most successful example of each type of business in the whole USA.

  • http://twitter.com/jseattle jseattle

    It looks like your math also assumes komonews.com generates the same amount of revenue as say rainiervalley.komonews.com. Seems unlikely. You can probably slice their per site number in half and then some.

  • Michelle

    I question whether local’s future is scale. KOMO news runs on the back of cheap 25-yr-old (bet her salary is in the low 5 digits) with little news experience and who likely doesn’t care so much about all the neighborhoods she is in charge of. Record lives and works in her coverage areas. That spells all the difference.

    Also, I question the old school model of display ads (born in that ancient era of printed newspapers) for online publications. How much traffic do the businesses get from their ads? This is ultimately the question to ask, because they are paying for the publication. I think there is still opportunity for more hyperlocal options in Seattle that serves local businesses better.

  • http://twitter.com/welocally WeLocally

    Great article. I see the indies looking to dominate of corporates in revenue two primary areas, curation (directories that matter to readers) and as a real estate portal. When it comes to taking the basic ad salesforce that they already have and adding a “hyperlocal” up sale the Corporates may have an advantage. 

  • http://www.facebook.com/profile.php?id=1037175800 Chris Wilson

    I’d like to know many return visitors each site has

    • http://twitter.com/westseattleblog West Seattle Blog

      Caveat, I am not an analytics expert. We scan very top-level to see how we’re doing – I could dive way down into the analytics but I wouldn’t have time for anything else. We mostly keep an eye on key indicators to see what’s going up, what’s not, what’s drawing the most interest. That said, I don’t know if this is good or bad for what we do, but for the past month in G/A, it was 78% returning, 21% new. I would imagine that’s not unusual when you’ve been doing this for a few years. (I don’t believe Tom mentioned it, but we have been doing news fulltime since 2007, two years after the site started as something else entirely; DataSphere launched its sites in fall of 2009.) – Tracy

  • Steves

    According to this article, “West Seattle has two major hyperlocal news sites (…) On Facebook, WSB pulls 5,209 “likes” compared to KOMO’s 132, and 509 “talking abouts”  to KOMO’s.”

    The West Seattle Herald has nearly 7,000 “likes” & “friends” on Facebook, with a rapidly growing fan base. This online news resource has been contacted by the BBC, and all major national networks for our take on stories ranging from our hyperlocal resident, Amanda Knox, to the pilot who survived the West Seattle built B-17 crash in the Illinois cornfield (we scooped the Chicago Tribune and CNN on that one).  Recently, our online story about a clothes drive for Nickelsville helped reunite a homeless pre-teen resident there with his uncle who helped give him shelter. 

    While I am in no way stating that http://www.westseattleherald.com is better, the same, or worse, overall, than the other two news sites featured in this article, I feel that by your ignoring our strong presence, and impact, in the West Seattle community in your article is journalistically embarrassing, if not irresponsible. 

    Thank you.

    Steve Shay
    West Seattle Herald

    • Anonymous

      Steve,

      I should have pointed out that I was comparing all-digital publications serving West Seattle.  The weekly Herald has an 88-year print history.  Comparing the Herald’s website, which benefits from the staff-produced content of the print Herald, to West Seattle Blog and West Seattle KOMO wouldn’t be a fair match-up.

      • Steves

        Valid point!  Thanks for the gracious reply.- Steve

      • http://www.facebook.com/wsherald West Seattle Herald

        The competition for eyeballs and dollars (at least at the digital level) means the comparison and match up IS in fact valid. You compared a two person operation with another multi person operation in your story. KOMO benefits from staff produced content all the time but is far less read online than the Herald’s site. It all boils down to viability and an ability to serve the community with news from a business structure that is not only sustainable in the short term but capable of being handed off or sold at some point to provide the community with continuity. KOMO isn’t an “all digital publication” its part of an enormous broadcast operation. To ignore the Herald in this equation is incorrect as Steve accurately pointed out.

        • Anonymous

          There are multiple valid ways to make this comparison. but I do think it’s a common, lazy assumption that every legacy news outlet, or every news outlet that publishes in print, is inherently outdated. You can still innovate with print, too, as you can with broadcast. They’re shrinking distribution channels, but useful ones — I guarantee WSB gives its advertisers a print copy of their price kit.

          The fact that KOMO also operates broadcast TV and radio stations means that its main revenue source is just as endangered as the Herald’s.

          • Moi

            My experience with trying to get ad rates from Patch, KOMOnews and WSB has been a bit surprising. They won’t even email rates, let alone print them. It’s all conversation about page views, which is confusing for small biz operators who are busy enough without having to make a decision about their dollars when they don’t have solid ground to stand on. Page views are useless for biz owners. Page views are excellent for publishers. To justify their ad rates, they use page views (which vary month to month) instead of unique visitors… which is a bit more meaningful—but still doesn’t guarantee that a unique visitor will see a display ad that sits at the bottom of a page when the article has ended further up… I just don’t believe the print model translates at all to the online model for businesses… yk, the people who pay for the existence of the publication. Scanning a printed page and scrolling down an online page are two very different experiences, and I think the coyness of how the online versions handle their sales reflects that difference. It’s just a matter of time before businesses start understanding this.

          • John

            Two points, which may be contrary…

            First, it isn’t just page views or unique visitors that are important, it’s a combination of the two. I will argue that a unique visitor who sees an ad 10 times (ie, 10 page views) is more valuable than a unique visitor who sees the ad once. After all, repetition is a very firm component of introducing something into memory. Which is where repeat traffic comes into play and a wise advertiser is going to have to start asking for that sort of thing. It’s nice to know that my ad gets displayed 75k times a month. It is also nice to know that 50k unique people see that ad. But what I want to know is how many times does my ad get shown to each unique visitor. And yes, I understand that unique visitor is *very* hard to pin down in the age of proxies and no, I don’t expect most small business owners to be able to navigate those waters. In fact, I expect the small business owner that is the website to help their fellow local business understand what all these glossary terms mean. If they don’t, I wouldn’t advertise there.

            Second, I personally would never want to pay for views. Click-Through Rates are really the bread and butter and where I’d be willing to pay. And it is one of those things that are more discoverable in this day and age compared to paper days. I can look at my logs and see how much traffic came to my site by way of your site. If you bill me for 100 clicks and I only see 50, I can give you my logs and say ‘Uh, no.’

            Personally, on the site I share with my wife (or she shares with me), we charge advertisers a flat rate. No log discussions, no disagreements, just ‘We charge you X. We may charge you less based on our traffic numbers. We can’t guarantee you traffic.’ 

          • http://www.facebook.com/wsherald West Seattle Herald

            WSB and KOMO do not in fact give printed copies. It’s all negotiable. The Herald’s rates have been printed from the beginning. No games about the price. It’s all up front. That isn’t to say prices are not negotiated but at least advertisers know that everyone starts at the same place. As for endangered revenue sources, KOMO is doing just fine with a major news presence and broadcast outlet on both radio and television. It’s a very large scale operation. The Herald is actually doing just fine too despite what the drumbeat in other media tells you. West Seattle is a unique area with geographic isolation, enough mom and pop local ad decision makers and enough people to make it place for vibrant community involvement and thus the need for shared news.
            The Herald is available on our own iPad app (know many newspapers with that?) and our own iPhone and Android apps. We’re on Twitter (with a primary and a crime only feed) and on Facebook with two accounts. We’ve innovated since we began and keep doing what we’ve always done as many competitors have come and as they all do…fade and then stop, we just keep telling West Seattle stories and delivering the best possible value for our advertisers. In the end, that’s what works.

  • http://RiverheadLocal.com Denise Civiletti

    Gary Cowan says: “Scale is the future of hyperlocal.” No, Gary. Scale is the future of guys with job titles like “SVP of marketing and sales” at corporate ad networks and corporate ersatz-local news websites.  Local is the future of hyperlocal. And local doesn’t scale — at least not in the way corporate board rooms want it to scale.  

  • http://twitter.com/westseattleblog West Seattle Blog

    Postscript to all this: WE WON!

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