Too Many Local Journalists Are Missing The Big Story: Revenue
Journalists, bless them, are passionate creatures. They are committed to goals, issues and people that never have enough guardian angels — like fairness and justice, good government, the underdog. And, not least, freedom of the press.
In the new digital era, which requires journalists to widen their lens far beyond the next big story, they are beginning to channel their passion into how to engage users, embrace technology and examine the limitations of their traditional “Fourth Estate” role is in the community. All good. But there’s one area where journalists have yet to bring the full measure of their passion — revenue. There are bright spots (some of which were highlighted in my column last week), but overall journalism is just not focused enough on how to pay the bills.
The Reynolds Journalism Institute recently held a conference called “Five Years Past…Five Years Forward,” seeking to close the passion gap. There were more participants from journalism schools than print and digital publications, but it’s in the schools where future editors and publishers have to start seeing how their noblest aspirations depend on dollars (from advertising, subscriptions, events — somewhere) and learn the skills that will generate those dollars. The revenue roundtable included two experts who have been immersed in the digital space — Reade Brower, publisher of the Village Soup publications in Midcoast Maine, and Ron Blevins, VP of digital strategy at Novus Media, a subsidiary of the new ad conglomerate Omincom-Publicis that helps regional and national advertisers find customers through community-based sites (whose audiences may be micro-sized but are more engaged and therefore more likely to click to business messages). I was happy to be among those who helped put together the roundtabl, which was moderated by Pekka Pekkala, a research fellow in hyperlocal journalism at the University of Southern California Annenberg School of Journalism.
On the panel, Brower said “banner advertising alone just doesn’t cut it” at the local-hyperlocal level. His three Village Soup sites generate a total of $360,000 annually in “native” ads, where restaurants and retailers make announcements about specials they’re offering in four- or five-line self-published items. Because they’re self-published, the ads don’t require salespeople or production work. Brower’s Village Soup sites also have a modest pay wall — “8 cents a day,” as he likes to say. But 8 cents a day from the 5,000 subscribers adds up to $145,000 a year, or about $48,000 for each of the publications.
Blevins said community news sites should be cautious about moving too sweepingly with the trend toward content personalization. A prominent chunk of the homepage should consist of common content “on the key things the community needs to understand,” he said. Then, he went on, the rest of the page can be tailored to personalized content. The result, he said, is “you create a fan. You start to create an audience. That’s the number one thing in sustainability and monetization … creating a value proposition for the advertiser.”
Pekkala talked about the surprising conclusions he and his USC Annenberg research team reached after they looked at the ad programs of 10 hyperlocal news sites: “Business owners have to realize you are part of the business community,” he said. “Once they realize you’re doing good for the community by publishing news, they are willing to buy an ad. Once they do that, they don’t ask, ‘How many clicks did I get, or page views?’”
After the Sept. 9-10 conference was over, I asked Brower, Blevins and Pekkala whether they saw a spark of passion from participants during the revenue roundtable.
Brower: “I don’t think people are focused enough on revenues. People were open to discussions on revenue and sustainable models but I was disappointed not to get any direct feedback about the BizBriefs and the revenue they have created. The Village Soup platform could help a lot of [sites] and should at least be checked out by those who are looking for way through the tunnel.”
Blevins: “I thought there was engagement. However, I’m not sure they grasped the urgency with which local publishers need to act….Publishers should focus on what will enable them to tap into national ad dollars in the short-term while building out their value proposition and premium sales initiatives long term. Supply-side platforms [which can be automated to connect with ad exchanges looking for inventory for placement] are a good way to do this, but a lot of local publishers aren’t leveraging this tool. In short, they need a monetization strategy.”
Pekkala: “Journalists only see the newsroom, not the whole publication they work for….The
whole idea of revenue models is such a new thing for journalists in general and they have no tools, skills or even the language or discourse to talk about revenue streams or profits inside their own industry.”
Bill Densmore, an RJI consultant who helped organize “Five Years Forward,” summed up the dilemma diplomatically: “The history and culture of journalism has not integrated business thinking very well.”
There are so many new, often interlocking components of business thinking that have to be integrated into digital journalism: big data, social media, third-party ad exchanges, geo-location of the user and, increasingly, the user’s behavior right wherever she is at the moment.
It’s a Herculean task, and that’s why journalists have to bring their considerable passion to it.
Tom Grubisich authors The New News column for Street Fight. He is editorial director of LocalAmerica, which is partnering with InstantAtlas to develop sites that will present how communities rate in livability. Local America is featured on the Reynolds Journalism Institute’s Pivot Point site.