For more than 20 years, local news organizations around the globe have been trying to make a go of it in the new digital economy. And most, as we read day after day, are still struggling. Layoffs are constant, bankruptcies common, and storied local brands face uncertain futures. This has fueled low morale and heightened cynicism in many local newsrooms. In fact, when the subject turns to local news, we’re more likely to hear what isn’t possible than what is. Local can’t scale, critics say. Local sites can’t build large enough audiences to generate meaningful revenue. Local advertisers don’t get digital. Many think the local news opportunity is too small to be worth much effort.
But this is no time for surrender. As someone who has spent most of the past 20 years working in local digital news—the last two running Billy Penn, a mobile news site in Philadelphia—I say now is the time to refocus on what local can do instead of what it can’t, and to build a new ecosystem on that foundation. Now is the time to take advantage of what makes local unique instead of trying to follow the footsteps of a national business model that will never work for local. Now is the time for a local digital news revolution.
For revolution to happen, it’s going to take a major shift in how local journalists think and operate. Too many local news organizations—both legacies and startups—likely are already doomed by a business model that is simultaneously keeping them alive and dragging them under. As Walt Kelly said: We have met the enemy, and it is us.
It’s not as if media’s economic problem hasn’t been staring us in the face for the past decade. In 2005, according to the Newspaper Association of America, US newspapers generated $47.4 billion in print revenue. That number has dropped every year since, and, in many, precipitously. By 2014, US print revenue had declined to $16.4 billion, marking a 66 percent drop over nine years. In that same time period, digital revenue for US newspapers increased only from $2 billion to $3.5 billion.
Yet, if you talk to many local editors and publishers, you’ll hear a long list of reasons why local hasn’t transitioned effectively to a digital world: We should have charged readers from the start! Google is stealing our content! Aggregators are stealing our content! We can’t compete with social media! Unethical ad blockers are killing us! Clickbait! The common theme of most of these statements is, “It’s not our fault.”
But it is.
We had plenty of time to adapt to the new digital world. Newspapers have been online since 1995. Google was founded in 1996. Craigslist launched on the Web that same year. Facebook was founded in 2004, Twitter in 2006, and Snapchat in 2012. If you look at some of the more editorially focused startups, Vox began operations as SBNation in 2003, Huffington Post and Mashable launched in 2005, BuzzFeed was formed in 2006, and Mic began life as PolicyMic in 2011. There was nothing stopping media companies—who were there before all of those companies—from being the innovators. And, almost completely, we missed the boat.
Most successful digital startups have focused on building national audiences and businesses. Most local markets remain open for innovation. But the first step toward local success is to stop acting like we’re helpless victims of changing times and begin dictating our own futures. To do that, local news organizations need to re-focus on things many have forgotten about along the way: their customers and communities.
In my view, it’s been a long time since local news organizations have focused on their consumers in a meaningful way. The huge profit margins of newspapers between 1970 to 1995 meant they didn’t have to listen to the reader. Beats and sections were added to generate still more revenue, even if the subjects weren’t important to a majority of readers. Yes, news organizations still served their communities journalistically during those days, but they fared poorly when it came to a two-way dialogue with readers. Many news organizations seemed to take the position they wanted to be of the people, just not with them.
It’s been a decade since the digital revolution made it untenable for a news organization to keep its distance from its audience. Consumers have an infinite number of ways to occupy their digital time. They now hold the power. The day of the local media monopoly is over, and over forever. Standing around lamenting how great things used to be may feel cathartic, but, frankly, it’s a useless exercise.
Let’s start by owning the mess we’ve made. Because until we do, we cannot fix it. To me, there are five major issues that continue to hamper local journalism, some of which overlap: 1) a continued lack of commitment to digital, 2) a fatally flawed business model, 3) brutal user experiences, 4) lack of a deep relationship with our audiences, and 5) sclerotic newsroom cultures. So let’s unpack those a bit.
When it comes to digital, let’s be honest: Many local news organizations embraced the medium with the aggressiveness of a Tryptophan-addled Thanksgiving glutton. When we were still relatively fat and happy—from 1995 to 2005—we did just enough to make it look like we cared about digital, but not enough to ever disrupt our legacy businesses.
By the time the bottom really starting falling out in the mid-2000s, and the push to grow digital became more than a throwaway line in earnings press releases or company all-hands meetings, it was too late for most. What digital businesses we did have by then were based mostly on a display ad model that required aggressive growth in pageviews and/or ad impressions. And, for many reasons, it was our pursuit of those metrics that led local to where it is today.
Why? Well, for most, the only way to achieve massive pageview and advertising impression growth was to stop worrying about local readers—or, put another way, whether readers were actually local. Where readers came from became less important than that they just came. This led to local news sites being overloaded with stories that had little or nothing to do with the communities they were ostensibly serving and, in many cases, were published purely to drive pageviews.
This need for more pageviews and impressions also led to what can only be described as the excruciating user experience of most local news sites. Slow load times? Check. Pop-up ads? Yes sir! Auto-play video? Of course! Forty-page slide shows? Why not? User experience? Sorry, not familiar with that term.
According to a Reynolds Journalism Institute article from October, the average load time for all US websites was five seconds. For US newspaper sites, that same average was 17 seconds. Yes, almost three-and-a-half times longer. If you think quality content is enough to convince people to wait that long for a page to load, stop right now and count out 17 seconds before you continue reading. It’s a long time.
Ad blockers are another example of how news organizations have mishandled the relationship with their consumers. Partially as a result, the aforementioned junking up our user experiences, the use of ad blockers has skyrocketed in the past year. The response from many news organizations—national as well as local—is to block or limit the access of readers using ad-blockers. But does the “we’ll-show-them” philosophy work in a world in which there are hundreds of news sites that won’t make the same user experience mistakes? And don’t for a second fall into the trap of thinking, “but we’re the only site that has that information.” That philosophy only works if that information is indispensable to your audience. Most local news sites no longer have enough of that kind of journalism to prop up an ad-driven business model.
So how did local news organizations find ourselves in this bind? Because we keep trying to play the same game as national brands, which is not only silly but suicidal. The definition of “local” shouldn’t be “national, just smaller.” Local is its own beast, one that comes with plenty of advantages and opportunities that national brands don’t.
Too many local news sites are, to paraphrase Sean Connery in The Untouchables, bringing a knife to a gunfight. If the past decade has shown us anything, it is that we cannot compete in a pageview-driven, ad-revenue-fueled marketplace. National brands can get away with more aggressive ad experiences—though the smart ones understand it’s a bad idea—because, when your market is the globe, there are always more potential consumers out there.
Local sites don’t have that luxury. We begin with smaller potential audiences than national sites, and local consumers are just as impatient with bad user experiences and irrelevant content. Local sites have to play for loyalty and depth. And we have a better chance to do that than national brands because of our one major advantage: Our audiences are largely massed around a single physical location. This is why, to me, events remain the most promising local revenue opportunity.
Local news organizations have always served their communities by keeping them informed and generating conversation. Why not make that conversation part of a business model by creating and monetizing events around local news? At Billy Penn, 84 percent of our revenue in 2015 came from events, and we expect that number to be similar in 2016.
But events only work if the consumer is given an active role. At Billy Penn, we have a rule that no more than 20 percent of an event’s time can be programmed. That means we rarely hold events that feature panels or speeches. Instead, we play the role of convener, putting interesting people in a room and getting out of the way. The best example is our monthly “Who’s Next” series, where we honor 15 to 20 Philadelphians under the age of 40 in areas such as health, education, or politics. We begin by highlighting the honorees and then let the sponsor say a few words. After that, the attendees talk to each other for the remainder of the event. Billy Penn’s other events run the gamut from beer tastings, to voter education seminars, to our annual ticketed Billy Penn Gala. This summer, we’ll be launching a Philadelphia film series and will hold monthly trivia events in various Philadelphia neighborhoods.
And maybe the best thing about events? You make money in a way that deepens your relationship with your consumer. At best, display advertising is a quid pro quo. At worst—and there’s a lot of worst out there—it has a negative impact on your brand.
That said, I’m still a believer that ads are part of a diversified revenue strategy. But only if we strike the right balance between user experience and revenue. The answer is not to block the ad blockers, but to move to a cleaner and more navigable user experience that, over time, builds a loyal local audience. Local news sites need to be thinking about monetizing a reader over a lifetime, not a single visit.
But none of the ideas or concepts mentioned above are remotely possible if one crucial thing doesn’t change: the culture of most legacy newsrooms. I have spent almost 21 years in digital journalism, 15 of them pushing for change inside legacy newsrooms. For years, I used the phrase attributed to management guru Peter Drucker: “Culture eats strategy for breakfast.” Except I think he was too kind. Culture also eats strategy for lunch, dinner, and snacks. Culture is central to any newsroom, and I think it’s the main reason we have not adapted quickly enough.
So, as you might guess, I’m dubious legacy cultures can change. That’s why I decided to go off on my own after leaving Digital First Media, where I lost most of my battles over user experience to publishers who cared more about cashing in an advertising impression than in making one locally. But even where you have publishers who understand the digital economy, most are still stuck with a business model almost fully dependent on display advertising. Making long-term changes to that model is virtually impossible without accelerating short-term revenue declines.
That’s why I think now is the perfect time to start a local digital news operation. There are few greater gifts in journalism than a blank sheet of paper. Billy Penn started with nothing. We had no history, but no baggage. We had no brand recognition, but no brand fatigue. We didn’t cover everything, but we didn’t have to cover everything. Every disadvantage is an opportunity to create an advantage.
That’s why it’s so encouraging to see so many entrepreneurs out there trying their hands at local. On the for-profit side, there’s Billy Penn and The Incline, its soon-to-be sister site in Pittsburgh, plus Berkeleyside, Charlotte Agenda, Mission Local, ARLnow, Baristanet, the Watershed Post, the upcoming Denverite, and many others. On the nonprofit side, there are early pioneers like Texas Tribune, Voice of San Diego, and MinnPost, plus new sites popping up seemingly every week. Spanning both models are members of the Local Independent Online News Publishers group (LION), including sites such as The Batavian, Richland Source, The Lens, and many more. Journalism consultant Michele McLellan tracks the growth of local sites at Michele’s List.
But there’s room for so much more—unlike in national, the local digital field remains relatively wide open. So here’s to hoping that the coming months and years will continue to see new approaches, new models, and new life in local journalism. For all we’ve done wrong, there’s still time to get it right.