Financial sustainability is one of the most debated issues among those in digital hyperlocal media. Observing the various business models created to serve hyperlocal communities, many industry outsiders have questioned the feasibility of media outlets that rely on small audiences and engaged local merchants for survival.
But industry-accepted standards and revenue models formulated over the past century — created largely for print media — lack common sense when it comes to hyperlocal. Nonsensical comparisons between “print dollars” and “digital cents” cloud the big picture.
Let’s take a brief look at the history of communication to explain:
- Many thousands of years ago, local media at its base level existed through animated story-telling. Eventually, written language was invented, but continued to face limitations due to an inability to mass-produce and a largely illiterate population — thus media in spoken word dominated. Influential figures in government, educators, and even the town gossip controlled the “media.”
- Fast-forward to the largest historical shift in communication with Gutenberg’s invention of the printing press in the 15th Century. A new hyperlocal media business model is formed with locally distributed pamphlets, leaflets, and eventually newspapers. This drastic increase in community information for the common man empowered social change, gave birth to the Age of Enlightenment, and arguably was a major stepping stone in the road to the Industrial Revolution.
- The Industrial Revolution and the continuation of innovation throughout the 20th Century provided the hyperlocal media industry with the tools to thrive through various forms of rich local media outlets — television, radio, newspapers, and print media such as area guides, coupon books, and local directories. Improved communication, a global supply chain, and technological innovation allowed the media business as a whole to drastically expand. Even in suburban communities, such as my hometown in Bucks County, Penn. (outside of Philadelphia), the local market supported four local newspapers, four printed lifestyle magazines, a half-dozen area guide booklets, local radio stations, and more. And that’s completely separate from regional Philadelphia media outlets. Local media thrived.
- Today’s digital revolution, with the creation and ever-growing accessibility of various forms of online communication, is again driving radical changes in the way communities receive information. New tools like social media, group buying platforms, and mobile & tablet technology are giving birth to innovative business models that are currently fighting to figure out the best way to provide information and services to communities.
“Why,” you ask, “is this relevant to the financial sustainability of digital hyperlocal models?”
This trip down memory lane clearly displays something many people are ignoring: the consistent market opportunity to provide relevant information at a community level dates back thousands of years, and it grows with each technological innovation. Yes, the tools have changed, but with each level of innovation a feasible business opportunity exists.
We do not compare business models that flourished pre-printing press to those sustainable post-Gutenberg — yet many people are stuck on comparing print media models directly to those of the budding digital age, failing to consider changing factors like lower distribution costs, as well as the value of targeted reach and trackable data.
As online and mobile gain more and more traction, there’s no doubt that the public is moving in a digital direction. As media innovators have done in the past, the hyperlocal industry will adjust their business models to fit the evolving times. The business community can stop debating whether hyperlocal sites are sustainable and begin concentrating on defining its value and creating superior models.
Tina Paparone (along with Angela Giovine) is a co-founder of Happenings Media, a quickly growing network of digital hyperlocal lifestyle magazines. Run by local publishers, each digital magazine serves as the lifestyle resource for a HAPPENING community while providing innovative digital marketing services to local, regional, and national advertisers.