Modern Media Revenue Strategies: A Panel From The Columbia Media Conference

Six of the sharpest minds in the business of journalism just sat down to discuss the strategies they’re using now, and where they’re laying bets for the future.

The FJP was in the audience, and has paraphrased the discussion below. 

The Highlights:

  • McKinsey & Co’s Jonathan Dunn saying that ALL of their print clients believe their future is in video.
  • The Awl’s Choire Sicha spilling the beans on which popular advertising unit is a huge waste of money.
  • Buzzfeed’s Jon Steinberg saying that young journalists should be considering making branded content for The New York Times, Huffington Post and everyone else.
  • Buzzfeed’s Jon Steinberg talking about where their traffic comes from.
  • Slate’s Matt Turck talking their multi-pronged revenue model.
  • McKinsey & Co’s Jonathan Dunn saying the tablet and smartphone advertising spend will grow from $1B in 2011 to $4B in 2012.

The Panel 

The conversation started with the panel members discussing the models they think are going to work.

Reminder; what follows paraphrases the conversation, with some omissions.

Matt Turck, publisher of Slate

When we first put a paywall up we had 20,000 people at $20 year at the first try. But that was not enough revenue to run a business.

If we’ve got the right people and ideas we can give the content away and it’s a viable business, that said we’re looking for new revenue; for example we’re in the events space. We syndicate a lot of our content, selling our high quality journalism to other publications at a low cost. We partner with YouTube, and there are a number of other small things; We’re experimenting with creating a membership program so that people who join get free entry to some events, and access to our editors that they wouldn’t get.

Buzzfeed’s president and COO Jon Steinberg.

The question is not how do you create a journalism revenue. It’s how do you create a robust business that can also support journalism. Conde Naste and Hearst have not made the transition to new models.

Harper’s Magazine, Vice President for Public Relations Jason Chupick

Any and all brand extensions that play off our tradition (which goes back to Mark Twain and Herman Melville) are on the table. Whereas a lot of people are focussed on short, quick journalism, we’re looking at going more towards long form. To re-invent what we have now would be extraordinarily hard, but we don’t need to be a big organization, we’re a non-profit.

Columbia Journalism School’s Dean of Academic Affairs Bill Grueskin.

(He said that despite having been the Managing Editor Online and Deputy Managing Editor of News for the Wall Street Journal, which had a very successful paywall, he said he didn’t believe that paywalls are a good solution for most publications) 

The WSJ now has more than 1,000,000 subscribers, paying between $75 & $150/year, but even when I was there we realized that the subscription model was a problem for advertisers, and this is the WSJ. Therefore we opened up so that google, email, social traffic could get in for free, and provide the amount of traffic that would be attractive to advertisers.

Paywalls are a defensive move, to protect the print products that represent 70-80% of revenue, but it’s time to go from defense to offense (actually it was about 5 years ago). 

McKinsey & Co’s Associate Principal, Media & Entertainment Practice, Jonathan Dunn

There are two big trends in the space: Video and the importance of data. 

Advertising revenue is breaking into two segments; premium (when you know you’ve got a audience with a particular ) and ‘remnant’, the low-end of not-particularly targeted. 

We don’t have a single print client who doesn’t see their future as video-based because the advertising on video is much more valuable. 

Regarding the importance of data; you must know in deatil who your audience is so you can effectively advertise them, and find relevant new opportunities. These days potential investors in media businesses don’t even want to talk to founders, the only thing they want to see is the analytics of the audience.

The AWL’s Founder and Editor In Chief Choire Sicha.

As a small independently-owned company, how big can we get? We aren’t expecting to scale. But that’s OK; The business models of each publication are intrinsically linked to their backgrounds and missions.

Buzzfeed’s  Jon Steinberg: 

Even in the glory days of magazines, most publications were never bigger than a mid-sized, but scale isn’t necessarily the key. For a recent advertising contract, Buzzfeed was competing with Awl, a much smaller site. But Awl still won contracts off the bigger buzz feed because their creative and audience was more attractive. Awl had enough inventory to fulfill that advertiser’s needs, because unless the client is the size of McDonalds, and is aiming to reach huge broad audiences, mid-sized audiences at OK.

Slate’s Matt Turck.

The unique solution that you build for your advertising partners is the key.  

Buzzfeed’s Jon Steinberg

The reason that there’s a debate about whether banners are good is that they’re crap. If a product is good there’s no debate.

At this point, the conversation moved on to whether tablets are a real opportunity.

Harper’s Jason Chupick

We’re on zinio, but it’s a stop-gap for most magazines, the PDF-like experience isn’t good enough. Tablets are the place to be if you’re a long-form magazine. Interactive firms need to hire better content creators. Making high quality interactive experiences is going to get cheaper. [Cited The Atavist, a tablet and smartphone-native publishing platform]

You’re going to have to show growth across all platforms for advertisers to be interested.

McKinsey & Co’s Jonathan Dunn

Our best guess is that $1B of advertising went to tablet or smartphone advertising in 2011, which is basically ad agencies’ experimental budget, but in 2012 we calculate that figure will be $4B, and in 2013 it’ll be $5B-$8B.

Buzzfeed’s Jon Steinberg

I don’t think the app thing is worthwhile. 40% of our site traffic is from mobile. Having a mobile strategy is like having a laptop strategy five years ago.

When asked about apps, ‘there are a lot of things people think that aren’t based on data’.

If people looked at the data which says no-one remembers the welcome screen advertisers, they’d be a lot better off.

The Awl’s Choire Sicha

No-one ever sees the advertisements at the top of a webpage. We’ve seen the research that shows everyone immediately scrolls down a little bit when they visit a page for the first time [to hide the top banner ads].

Columbia Journalism School’s Bill Grueskin

One of the big problems from the newspaper industry is that they’ve asked how they can repurpose their print content, but most newspaper content doesn’t work well and it stymies them from developing new content that is native to the new platforms.

The Awl’s Choire Sicha

There is no right answer about whether to put print content online for free; it depends entirely on the product and category.

The conversation turned to social media.

Buzzfeed’s Jon Steinberg

We get double the traffic from Facebook than we do from google, and that’s the same throughout our network.

Google’s algorithm is too unpredictable. So Facebook, which is real human beings sharing your content is a much more sustainable way of building audience.

Slate’s Matt Turck

 We’ve got 450,000 followers on twitter, 250,000 on Facebook. We’re having more and more conversations with readers on Facebook, our editor gets questions from the Facebook audience for his interviews.

At this point, the conversation moved on to the skills young journalists should get themselves.

Columbia Journalism School’s Bill Grueskin

You still need to know how to get information, verify it, present it in a compelling way, and understand what your audience needs.

I’m not a fan of the swiss army knife journalist who can do a hundred things, but none of them well.

Being able to engage readers on social media, not just as a distribution process, but to help you understand what your audience needs and what your community knows about the story you’re working on.

If you can do all of that you can go to a news organization and make a compelling case about why you should be hired.

Buzzfeed’s Jon Steinberg

There are a whole lot of journos, (Nate Silver, Ben Smith) who have become little industries in themselves.

Advertising is an amazing industry, that you can love and be inspired by.

If you read the advertising titans’ books you’ll be inspired.

There’s a massive need for journalists to make branded content. If you can do that, you can go to everyone, Huffpo, NYT, Buzzfeed who will need your ability.

Slate’s Matt Turck

Now more than ever before the individuals have become brands. If you can build a following, there’s not a publication out there who won’t take a look at you.

You’ve got to keep changing so fast with the industry. Embrace Change.

Buzzfeed’s Jon Steinberg 

Going back to the branded content topic; you need to have a solid wall between branded content and the rest. At Buzzfeed we have an absolute separation, between the two sides of our business, both in the organization and on the site. Every day we put content up on our sites that will annoy our advertisers.

As noted above, this paraphrases the discussion and omits some of the conversation. If you can add, or refine the article, please email Fergus Pitt.

Disclosure: Bill Grueskin is the author’s masters thesis supervisor.

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  5. respective said: I sit on the Advisory Board to the Journalism Department at Cal Poly San Luis Obispo, and I’ve sent this article to faculty and the department chair. Thanks for this coverage!
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