Instead, Owens runs the site like a “pennysaver”—every advertiser appears on each page, in long columns running down both sides of the site. Their positions rotate during the day to make sure every merchant spends some time near the top. And to encourage scrolling, every article appears in full on the site’s front page, with the most recent items at the top. It is possible to absorb all of the day’s news without ever clicking beyond the home page. Owens doesn’t have to worry about driving traffic to various corners of the site to deliver impressions to different advertisers. He designed this approach based on his experience at three newspaper companies, with access to online data for more than 100 local papers. “I saw that it’s very hard to get people to move past the home page,” he explains. “So I decided to base my business on that.”
A national brand probably would not place its ad alongside 100 others. But Batavia’s merchants have the sense that they are sponsoring a popular local resource at a reasonable price. Local boosterism makes a difference, Owens insists: “Some advertisers just want to support community.” His advertisers rarely ask about click-through rates, though Owens says some are pleased to learn that, say, a total of eighty people clicked on their ad over the course of a month.
A useful metric for evaluating this approach is not CPM, but RPM—revenue per 1,000 impressions. Assuming The Batavian earned $125,000 in 2010 (the middle of the range Owens claims) and averaged 600,000 page views per month, it achieved an RPM of $17, an impressive figure for a news site serving a small and far-from-affluent community.
A similar formula applies at Baristanet, one of the most successful local news sites in the country. Baristanet has one decisive advantage: its audience of affluent, media-savvy professionals in the retail-rich bedroom communities of suburban New Jersey, anchored by the towns of Montclair and Maplewood. (The area scores well on AOL’s algorithms—six of the seven towns Baristanet serves have their own Patch sites.)
Baristanet, launched in 2004, keeps costs radically low. Everyone involved with the site has another job—even the two founders, Liz George and Debbie Galant. “Everyone’s freelance,” George explains. She and Galant act as top editors, giving the final word on every article; one other editor is paid by the month.The rest of the site’s dozen or so freelancers—many of whom “daylight” from salaried jobs— are paid by the piece, usually about $50 each. “We don’t want long articles,” George says. “If they spend half the day on a story, that’s too long.”
Then there are people who write for free, submitting opinion pieces, comments, bulletins, and photos. Baristanet offers roughly the mix of content that a community weekly would; one Friday in March 2011, for instance, some political news about local budgets was sandwiched between pieces on “weekend highlights” for kids and a major markdown at the local cheesemonger. George explains that many smaller items require no reporting at all, just a photo and a blurb. The combination of paid articles, opinion, aggregation, and “things that come in over the transom,” yields more than enough material to keep the site fresh, she says.
Altogether, editorial costs run to $5,000 or $6,000 per month—higher than at The Batavian, but still fairly modest for a site that runs about eight longer articles per day and, according to George, attracts 80,000 unique visitors monthly. Most important, costs are far below the roughly $20,000 in advertising Baristanet pulls in each month. For several years, according to George, the site’s profits have provided a sizable second income for the two founders and their hired editor.
Baristanet also eschews cost-per-thousand pricing in favor of a simple calendar model, and, though rates run higher than at the Batavian, an advertiser can get on the site quite cheaply. Merchants pay from $150 to $1,600 per month (weekly rates are also available) depending on their ad’s size, placement and frequency of rotation. George says businesses in the area have no interest in buying by the impression or by the click, though Baristanet does report such statistics to them.
Because Baristanet rotates ads across its available inventory, a merchant’s exposure is limited by the amount of traffic the site gets. According to George, consultants have advised against ad rotation, but so far the hospitals, car dealerships, real estate agents, restaurants, and other businesses that advertise on the site don’t seem to mind. Merchants occasionally call wondering where their ad is; George advises them to refresh the page a few times until it appears.