|Pubs' Revenue Dips 2.3%|
|It’s been hard out here for digital publishers in 2020. According to the latest Digital Publishers Revenue Index (DPRI), publishers’ revenue declined 2.3% YOY compared with Q1 2019. Overall, digital revenue fell by 4.0% on a 12-month rolling basis.
Display and recruiting advertising fell 22.5% and 12.8% respectively in Q1. And while subscriber revenue grew to an impressive 20%, it just wasn't’ enough to make up for the drastic revenue losses.
We heard the very same thing from a Zoom roomful of publishers who told us they had to turn up their subscription revenue strategies full throttle during the early months of the pandemic to mitigate revenue losses.
|Those same publishers we spoke with talked at great length about the importance of diversifying revenue and cutting costs for the rest of the year, even with programmatic making a slight rebound.
For example, Publishers like Digital Trends, have put more emphasis on a service-driven approach to commerce—and it’s been working for them. Many pubs have also turned to employing self-service platforms to capture smaller budgets. And some others are figuring out their first-party data strategies.
The Association of Online Publishers (AOP) board members also report prioritizing non-advertising revenue growth and reduction strategies. Almost 90% of publishers cite non-advertising revenue growth as a high priority for the next 12 months, while as much as 78% said cost reduction would be a high priority for the next year, up from 44% in Q2 2019.
There’s been a shift in advertising revenue accounting for the majority of publisher revenue for some time now, but it has only been exacerbated by the onslaught of COVID-9.
According to DPRI, on a 12-month rolling basis, subscriptions and miscellaneous revenues grew strongly by 18.8% and 25.9% respectively, while online video revenue grew by 10.7% and sponsorship saw a slight increase of 3.2%. But still, it wasn't enough to make up for the overall 2-month decline.
It would behoove any pub looking to move past this unwieldy beast to immediately stop sticking to the rivers and the lakes that they’re used to.
|A Viable Model for Local News?|
Image sourced from Twitter
|Long before Auntie ‘Rona overstayed her visit and opened a can of whoop ass on local news, community newspapers were already endangered as circulation and advertising have been free-falling over the last two decades.
Fortunately, it looks like Andrew Wilkinson, Co-Founder of Tiny Capital, has a solid idea that just might save local news. Last week, he tweeted about a wildly flourishing daily newsletter (á la Morning Brew, theSkimm, The Hustle) he created focused on his hometown of Victoria, Canada last year. In one year, the newsletter skyrocketed from 5K subs to roughly 40K.
In Wilkinson’s own words, here’s the short of his success: “I spent $200k on FB ads, $50 on Mailchimp, and $60k on a writer and BOOM! Now I own the largest daily audience in the city, with no gatekeepers (direct to inbox, no FB or platform risk). I expected to burn money, but now advertisers are lining up and we’re realizing it can not only break even but be profitable…”
|While Wilkinson’s model isn’t exactly novel, it’s a step in a promising direction. To that point, it wasn’t long before others joined in on the Twitter discussion debating their own attempts at turning local news over on its head.
One of the biggest concerns raised in the discussion: Does the local news refashioned as a millennial newsletter scale?
There were an ample amount of both yays and nays, but the most interesting response to that question came from Ryan Heafy, COO of 6AM City, a hyperlocal media company activating seven communities in the Southeast through daily email newsletters that aggregate local news + events.
6AM City has even rebuilt traditional classifieds with a self-service platform enabling local businesses—without a large budget—to promote their products and services. The listings are hosted on 6AM’s sites and then pushed to the appropriate newsletters.
“We've scaled @6amcity to 7 cities in the southeastern U.S. It is hard. Every city is different. Revenue, process, culture all play a big part and must be the top priority. We've just gotten into our groove. 250K+ subs, avg. sub lifetime 20 mos., 30-40% daily open rate,” Heafy said.
Though not completely rock-solid, the proof couldn’t be more clear that it’s a viable alternative local news model. If there’s nothing else the pandemic has taught us, it’s that local news is the most trusted and meaningful to people’s lives. So, we’d love to see some recently laid off local news journalists band together and give it a try.