To be fair, Omidyar is focused on re-inventing news media generally. While no one really knows what Mr. Bezos has up his sleeve, it may be a more transformative approach if the newspaper itself stays largely the same. Omidyar is preparing to create a national or international news entity, while Bezos is retooling a large metro newspaper with a national brand.
Is anyone reinventing smaller local newspaper franchises?
Certainly, Advance (itself owned by a family of billionaires) is taking a whack at it by reducing print frequency and creating new, digital-only news and marketing operations. The traditionally tight-lipped media company has not revealed much about what informed the strategy or how it has played out so far.
While smaller-market newspapers are healthier than their big-market brethren, their long-term future, too, is in doubt without a fundamental rethinking of the franchise. It would not take the resources of multi-billionaires (perhaps just a cadre of civic-minded local millionaires) to build a successful, for-profit, local media organisation. If I had the luxury of starting a relatively well-funded local media enterprise from scratch, this would be my blueprint.
Note: There are many traditional media organisations that are implementing and executing on strategies and approaches outlined in this blueprint. These organisations, along with innovative digital news startups, provide ideas, approaches, lessons learned, and departure points for our own business and product strategy.
The context for this blueprint is an acknowledgement of a range of market “truths” including:
- The era of mass media is on life support as the new world order of personal media has arrived.
- The news ecosystem has been disrupted by deep vertical players, wide technology-based aggregators, and pervasive connectivity.
- As such, traditional media organisations cannot compete if wedded to their historical organisation, processes, and cost structures.
- As community has splintered into a range of special interests, the only segment that is somewhat defensible is local.
- News is no longer primarily consumed at a single destination. Rather, it is consumed across a continuum, increasingly starting with social media or on a mobile device and progressing through more traditional channels to layer on context, additional information, and related content.
- The media environment is just as (if not more) complex for marketers as it is for publishers.
- Those organisations that provide customers with the best return on time, attention and financial investment win.
I would start, as with all new construction, with the foundation. And that is this: To meaningfully connect individuals and local communities with information, tools and insights that will help them better navigate their lives today and plan for the future.
At the core, the franchise will be in the audience aggregation and exposure business and will generate revenue from consumers who find value in what we offer and from marketers who want to communicate with the audience segments that we reach at scale.
The architecture would be based on these principles:
- Be the hub of all local activity.
- Create a platform, not just a site.
- Serve the needs of targeted audience segments.
- Be a clearinghouse for all relevant information.
- Provide solutions on the most appropriate channel for targeted segments.
- Be profitable and sustainable.
That also means that we will not attempt to be all things to all people. The franchise has to stay focused on core competencies and the local community.
The strategy will assume that the audience is grazing through a variety of media channels and brands to stay informed. I won’t compete with ESPN for national sports or WebMD for health information or Marketwatch for business news. I acknowledge that the company has neither the resources nor expertise to do it all, and partnerships with suppliers, other media companies, community organisations, etc., will be required.
Our value will be in providing context, relevancy, authority, presence, proximity, personality, and trust.
The bricks and mortar of this new entity will be data and analytics. My most critical investment will be in the collection, manipulation, understanding, and effective use of insights to drive everything we do: product development, marketing, editorial approach, sales, ad targeting, performance measurement, customer service, inventory optimisation, distribution, customisation.
Content creation and aggregation as well as sales will be built on a deep understanding of consumer and advertiser characteristics and behaviour. This requires that we own and have a direct connection to our customers in any partnerships we pursue.
As a new organisation, I have the luxury of hiring talent with the right skill set and mindset from the outset. This will be a streamlined operation that will outsource everything that makes sense to outsource. I’ll invest in an experienced, digital-savvy, audience-focused leader and manager to head up all consumer-facing operations and a digital-native, experienced, creative sales executive to lead revenue generation.
The leadership team will include a technologist who will help build a robust platform as efficiently and inexpensively as possible. I will also hire a scary-smart data scientist to develop our data management, analysis, and application capabilities.
Everyone — from content developers to sales reps to engineers — will be responsible for collaborating on audience, product, and revenue development. And all will be required to have an entrepreneurial spirit.
Many will argue that the incumbent media franchise’s infrastructure, relationships, and brand are huge competitive advantages. I would argue that part of legacy organisations’ struggles are due to the challenge of extricating themselves from entrenched practices. And brands in this environment are tenuous — particularly among younger generations — if they are not consistently delivering a solid value proposition.
So, to continue to beat this metaphor to death, let’s frame each of these principles.
Be the hub of all local activity.
As communities continue to fragment and become more isolated, the local media franchise will provide the connective glue. Everyone in the organisation (top to bottom, but especially top) will be required to listen to and interact more directly with the community (including advertisers).
We will serve as moderators and facilitators to raise the level of community discourse. We will provide mechanisms that will allow the community to help direct coverage of what matters most to it.
Our brand must be everywhere. Our physical presence is our key competitive advantage.
We’ll host frequent “town hall meetings,” hold regular Webinars, tutorials, and online conversations on local topics of interest, plan local concerts and other events, promote contests, honour community activists, have a presence at local sports events, and provide a “speaker’s bureau” of staff and other experts for local meetings.
We will provide incentives (e.g. “free stuff”) for users to “friend” us, make us their homepage, and download our app.
Create a platform.
Futurist Paul Saffo, in his 2005 essay Farewell Information, It’s a Media Age, described how “big company mono-culture” was being replaced “with a new creator-centric business ecology in which the success of the big players is directly dependent on the participation and good will of multitudes of small players.”
As such, I’ll build not just a media entity, but a technology-based platform supported and enhanced by staff, community, customer, and business partner engagement and contributions.
This will become a powerful local information franchise the way eBay became a commerce behemoth and YouTube became a video empire.
I’ll provide publishing tools to all of our constituents that will allow them to contribute content, opinion, requests for help, filters, personalisation, recommendations, sharing, and more.
Serve the needs of targeted audience segments.
Newspapers, in the words of one analyst, “traditionally skim the surface of dozens of verticals and own none of them.”
In reality, we must be both wide and deep, continuing to be the connective thread that ties the community together, but also drilling down to serve large, high-value audience segments — high-value in the sense of being loyal consumers, willing to pay (with their time, attention, and wallets), and highly desirable to key advertisers.
This doesn’t mean we will become an elitist organisation. Enterprise journalism and content curation will serve the entire community, and our platform will help the community inform itself. But the allocation of resources must also provide quantifiable ROI.
Again, the investment in data will help us identify what those high-value, scalable audience segments are and what topics and categories we will own. That might include prep sports, information related to the industry of the community’s largest employer, education, even weather and traffic.
Whatever the vertical, I will be prepared to invest additional resources to cover that area better than any of our competitors.
Be a clearinghouse of all relevant information for those audiences.
Our editorial mission will be to focus on key issues and topics that have high impact on the community and provide information that can’t easily be gathered (i.e. readily available) elsewhere. That inherently means people, businesses, events, governmental agencies, and activities that are locally based or that impact the local community.
Jan Schaffer, executive director of the J-Lab at American University, believes local media’s new mission is “requiring journalists to embrace new partners, validate supplemental news channels, and support — without always controlling — a vibrant local news-scape.”
Quality content development is an expensive proposition, and, to keep costs aligned with revenue, we will define the right balance of resources between original reporting and aggregation of relevant content.
Data will be key to understanding audience interest and trending conversations and for making recommendations.
The organisation will need:
- Editors that are skilled observers and who, by nature of their training and experience, have the insights to help elevate and provide context for issues impacting the community.
- Multi-media journalists/category experts who have the potential to be stand-alone brands, each with their own social media accounts, e-mail lists, contributors and, perhaps, even micro-sites.
- Skilled content managers to: aggregate the most compelling and relevant content from other publications, blogs, user comments, our own events, social media networks, etc.; partner with other content providers; and manage a network of vetted, independent freelance writers.
- Writers outside of the newsroom (internally or freelance) focused on developing human-interest content of high interest to potential sponsors.
- Data scientists to provide insights to editorial staff and recommendations to users.
- Tools to allow users — “Reddit-like” — to comment on and impact the placement of certain categories of stories through voting, “liking,” sharing, or just volume of usage.
Provide solutions on the most appropriate channel for targeted segments.
The franchise will be platform-agnostic. That is to say, I will invest in the tools and systems to distribute the right content to the right platform for the right audience. The Web site will be our hub, but our spokes will reach into social-media platforms, blogs, customer sites, e-books, etc.
Our brand awareness strategy will stretch into content distribution to ensure we reach our current and prospective audiences across multiple channels.
And, yes, one of those channels will be print.
The printed product will be a premium product for that still significant audience willing to pay to access content in that form. It will be part of a portfolio of products we produce to serve high-value audiences.
The product will be specialised, based on audience preference, and focused on the “scanability,” portability, high-bandwidth, and relaxed nature of reading in print. It will not be available in printed form every day, and all production and distribution will be outsourced.
But I will channel resources to ensure we are focused on platforms and devices that provide the greatest growth opportunities. As such, I will invest in the development and curation of compelling video, and equip editorial and sales staff with low-cost video production and editing tools.
The centerpiece of product development efforts will be an optimised tablet product. Although that will, in the near term, provide the lowest penetration of any platform, it is where we need to be headed. We must learn and experiment now and get ahead of our competitors.
Our initial approach will be to develop an HTML5 product and, based on usage and feedback, determine whether or not to make the investment in a native app. I will also invest in experienced content producers who know how to create compelling, tablet experiences.
The tablet experience will flow back into our Web product, which will be broad, general, and available to everyone in the community.
We will provide — as we do on the tablet — both quick reads and in-depth, multi-media presentations of high-value news and information:
- The smartphone and e-mail product presentation will provide quick-read summaries of top stories identified by editors (for relevance) and readers (for interest).}
- The mobile product will highlight content most critical to an “on the go” audience (weather, traffic, crime scenes, events, sales, etc.)
The publishing platform will allow us to easily create two versions of most articles: a “lite” version for smartphones and external distribution (e.g. social networks), and a more complete version for our own products. The “lite” version will provide essential information and tease the complete package. It will be surrounded by promotional elements to elevate exposure of our brand, and hype the most compelling content on our site that day.
Be profitable and sustainable.
The advantage of a local benefactor is the runway it provides to focus on our core business mission: audience aggregation. It will give us valuable start-up time to build product expertise and grow our audience base without the overhang of rapid ROI.
But my expectations are that within 12 to 18 months, we will have a compelling proposition for both consumers and advertisers that will get us to profitability.
As with the product side, we will leverage our core assets: connection to the community, data-driven insights, ability to drive store traffic, access to high-value, local audiences. We have to find defensible revenue streams and provide value in ways that Google, Facebook, and other digital revenue leaders can’t — which is not solely through technology, but human touch.
Our approach will be to:
- Hire digital-native sales and yield optimisation specialists.
- Focus on account numbers rather than size (in other words, engage as many local merchants as possible).
- Use data to target as precisely as possible, by geography, demographics, behaviour, or whatever other appropriate criteria based on advertisers needs.
- Become a full-service advertising and marketing agency for a segment of our advertiser base.
- Be the “scale creators” in our market by investing in audience extension strategies, selling inventory beyond our own products.
- Develop solutions for the faster growing “below-the-line” marketing opportunities, including events, business-to-business, public relations, direct marketing, consumer promotion.
- Consistently track, experiment, and execute on inventory optimisation strategies.
- Produce content that puts consumers in more of a shopping frame of mind and provide content to help marketers better engage our audiences.
- Drive more national and regional advertising by providing advertisers with a consistent value message, common metrics, and easy-buying process across markets. That will require meaningful industry collaboration.
- Partner with platforms that will help us build a local marketplace for goods and services that we can help promote and directly sell.
We will also relentlessly pursue consumer revenue by experimenting with and identifying products and services worth paying for.
The print product will be sold at a premium. We will develop exclusive events, classes, and networking opportunities that leverage our expertise and community connections. We’ll create customisation and alert capabilities that we’ll ask both consumers and businesses to pay for. We will offer transactional services that provide us with commissions, fees, or revenue shares.
As with any new construction, the path from breaking ground to backing up the moving van can be circuitous and filled with unknowns. The blueprint often is unchanged, but the final outcome might be modified along the way. That would be the expectation for this franchise, as technology continues to evolve, customer behavior shifts, and competition increases.
There is no P&L for this organisation, yet, but one can certainly be constructed. While this is not a shoestring operation, it will not require the resources of a New York Times. Much of the technology and other resources needed can be acquired off-the-shelf, via software-as-a-service, using open-source platforms, through partnerships, outsourced or even free (see this piece and Apps for Media).
But we won’t scrimp on talent, data, and marketing. Funding this operation will require a local version of Pierre Omidyar, Jeff Bezos, or other financial backer (including a traditional media company) with a vision for the long haul.