Prescription for Patch: Become an All-in-One SMB Marketing Solution

Kirk Caraway is a guest author.  To submit a guest post, click here.

There has been a lot of criticism hurled in recent months at AOL’s hyperlocal news experiment Patch. It seems that some new “dramatic” tidbit is always showing up in the trades about how Patch is failing.

Some of this criticism is deserved. I don’t think the folks at Patch would claim there haven’t been mistakes made. But part of the reason it’s in focus is that the company makes an easy target for those in the news business who are shell-shocked by the changes transforming the industry.

I think there is a lot of value in the network approach to hyperlocal news. Many small startup publishers are challenged by the technical details of web publishing — and by the need to offer the kind of polished, powerful, digital product that online readers have come to expect. Tech and design can suck up huge amounts of time and resources. By centralizing the technical details, Patch achieves an economy of scale, and frees its local editors to concentrate on content.

Putting content aside, though, it seems the big problem for Patch is sales. With only $20 million in reported revenues for 2011 across the 850+ sites, it’s clear that something is missing. This report from Business Insider quoted a Patch sales team member who said that 70 percent of salespeople were not hitting their targets. Another report estimates that the average member of Patch’s 152-person outside sales team is only bringing in $52,022 a year in ad revenue.

Patch’s problem is the same one that affects many other local news operations: in pinning its focus so heavily on display ads, the company isn’t offering local businesses the kind of comprehensive marketing service they really need.

Let’s back up a minute. Before the web, newspapers were the kings of local. If a you had a local business and needed to get the word out, you just called up the newspaper to place an ad. It was that easy. But newspapers don’t have the monopoly they enjoyed in the past. Not only are there many other sources for local news, newspapers also have to battle for readers’ attention against Facebook, YouTube and the entire Internet, as well as 500+ channels of television, Netflix, video games, etc. The days when a local business could successfully market itself to new customers by simply buying an ad in one publication are gone. Yet online news organizations — including Patch — are still by and large using the same old newspaper advertising model.

The mission of any newspaper or other advertising-supported media operation is this: Help your clients communicate. That is what they pay for. In today’s media world, display advertising is just one method of communication. These days social media, public relations, search engines and other online marketing vehicles all play a role as well (in addition to advertising). Those in the local news business might despair at this fragmentation, but they are actually missing a huge opportunity.

If you talk to local business owners about all of these online promotional vehicles, you will find that most of them are confused and frustrated. They know they should be using Facebook and Twitter, or updating their websites, or doing more PR, or sending out email blasts. They are constantly hit up by salespeople promising to put them on the front page of Google, or selling them Yellow Pages listings online, or a hundred of other types of advertising. But they don’t have the time or the knowledge to handle all of these things. Too often they fall for scams, or rely too heavily on one vehicle, only to find that it doesn’t pay off.

Unlike other local start-ups, [Patch] has the resources to build this kind of integrated system, and can use the power of its network to create effective marketing and sales programs to push out to all their sites.

Businesses don’t need more online advertising options. They need a solution. The real opportunity is to offer businesses a service that bundles together as many of these promotional vehicles as possible into a simple, low-cost package that makes it easy for them to communicate with their customers.

The service I envision is one where a business manager can do something as simple as writing an email, and have that message pushed out through multiple channels. He or she can write, “Hey, we’re having a sale today!” and have that message automatically formatted into an advertisement on the news site. In addition, it could also be pushed out to his or her blog, as well as posted to Facebook, Twitter, Google+, etc. In the process, that same message could be emailed out as a press release to all the local news media and/or blasted out to the business’ customer email list.

The next step would be to integrate this message into the news site. Press releases can be automatically imported in the site, and displayed as sponsored blog posts. Those messages that have dates tied to them can be included in the site’s event calendar. Messages could also be marked as coupons or specials, and given different display options, or included into the news site’s email newsletters and social media pages. The service could even create local advertising networks to place these ads on other sites, or allow clients to book and manage ads on Google, Facebook, Bing and others.

If business managers are too busy or not savvy enough to pump out the messages themselves, then a fully managed service could be offered to do it for them. Now, you have something that is worth a lot more than CPM-based banner ads.

There are other services available that try to make it easy for business to update different social networks in one step. But the advantage local news publishers would have with a system like this is the ability to combine their clients’ communications with advertising and content, and present them to a local audience. Just as advertising alone is not the answer, neither is social networking. This is where local news sites like Patch can offer a service that others can’t.

If Patch decided to go this route, the company would be well-positioned to make the service work. Unlike other local start-ups, it has the resources to build this kind of integrated system, and can use the power of its network to create effective marketing and sales programs to push out to all their sites.

But to get there, Patch will have to change its advertising-centric mindset and focus on providing a service with real value to local advertisers. No business can be successful unless what it offers to its target customers is something they need. Solving their clients’ communications needs would go a long way toward patching the hole in AOL’s ship.

Kirk Caraway is founder/publisher of CarsonNow.org, and mother site of the Nowtown Network that includes SouthTahoeNow.com. He grew up in the newspaper business, and is an award-winning writer and editor. He started building and managing local news websites in 1994, and has witnessed firsthand the evolution of local online news. He can be contacted at kc@carsonnow.org.

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  1. Ron Stitt
    April 20, 2012

    I could not agree more.  Very well said.

  2. Mark
    April 20, 2012

    They’re doing it now but they’re giving it away for free. The SMB community loves free advertorials with almost no strings attached! Of course they do. But we’re pretty sure that if AOL starts asking for money in  return for that same kind of advertorial work, that interest will wane. 

    1. April 23, 2012

      “Free advertorials”?! LOL

      Now there’s a classic oxymoron-doing-a-double-backflip. I always told staffers that “advertorial” is verboten on publications I run because it is a hoary portmanteau invented expressly to mislead and confuse the market. It’s salesmanship at its most cynical.

      If it’s paid space — text, art, display, article, no matter — it’s advertising. If it’s not, it’s editorial. -30-

  3. Vilma
    April 20, 2012

    Excellent article. I freelanced for Patch for two years and a product offering like this would differentiate them. As a writer, I help small small businesses with their marketing needs. Many of these businesses find advertising too expensive and utilizing social media too overwhelming and time consuming. I hope Patch makes it but I do agree they are giving some of this away for free. A two pronged approach offering a less expensive advertising product with some of the bells and whistles (you mentioned) for small business owners and a focus on building regional advertising would be a better plan.

  4. April 20, 2012

    Love it.  Many very good points…  help them communicate… simplify things.  Most local business owners just want to run their business, whether that’s a salon or a restaurant, or a being a plumber if that’s what it is.  They don’t want to be advertisers or marketers, particularly in the fragmented online space.  They don’t have the time for it.

    We’re trying to help them to that with EggZack, an automated local marketing solution that lets them enter the information once and push it to all the places that it needs to be.  

  5. gregsterling
    April 23, 2012

    This is an agency “one stop shop” approach that is already being pursued by numerous channels in the market.

    1. April 23, 2012

       There is a subtle but important difference between the agency model I’ve seen other publications adopt and what I’m talking about. I believe the key is to not just act like an agency, but to offer a service that very tightly integrates the publication’s advertising with these other services. The problem with the agency model is that if you are just selling the same services as other ad agencies or pureplay web companies, then you will find it hard to compete, as they don’t have the overhead of the news production to worry about. Local sites need to offer a service that can’t be easily duplicated by non-content producers.

  6. howardowens
    April 24, 2012

    “I think there is a lot of value in the network approach to hyperlocal news. Many small startup publishers are challenged by the technical details of web publishing — and by the need to offer the kind of polished, powerful, digital product that online readers have come to expect. Tech and design can suck up huge amounts of time and resources. ”

    I’m calling bullshit on that one. There simply isn’t a lick of truth to this unsubstantiated statement.

    Yes, the smbo is looking for a lot of help in digital marking, but they’re also looking to do business with people they trust — advantage local publisher.

    1. Scott Brodbeck
      April 24, 2012

      Ironic the “challenged by the technical details” statement is being made on a website that seems to be glitching in the comments section (at least on Chrome and IE).

      But to the point, would you write that a local indie coffee shop doesn’t have the technical means necessary to keep up with Starbucks? Probably not, because they’re perfectly capable of ordering espresso machines from a vendor. Likewise, local publishers — who are businesspeople, after all — are perfectly capable of spending a couple grand on a spiffy custom-designed WordPress site.

      1. April 24, 2012

         I’m also having problems with seeing the comments, on Firefox. I can’t reply to Howard’s comment because the reply link is hidden under an ad.

        I’m sorry that Howard thinks this is unsubstantiated BS. I’ve run my own local site for almost three years, and before that managed the websites for seven local newspapers, and I can tell you through personal experience that the technical details can suck up huge amounts of time. Every minute spent chasing down website bugs is time not spent creating content and selling ads. In theory, if you can centralize the tech stuff for a group of sites, you can free up those sites to concentrate on content and sales. This can, in theory, give a network like Patch an advantage.

        Howard IS right about SMBs wanting to do business with someone local they trust. Without putting real boots on the ground, local sales people who can build relationships with local businesses, Patch will still have a tough time making it. They also need to sell something that local businesses need, not just the same old banner ads on yet another website.

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