Hear Me the Money: If News Organizations Embrace Engagement, Will $$ Follow?
The potential connection between revenue and engagement is a hot topic in journalism right now, for good reason.
Whether and how the news media, long beholden to increasingly unreliable scale-based, ad-driven business models can find success with high-touch membership and subscription approaches “optimized” for virtues like loyalty and trust is the big question of the day.
Engagement — however you might define it — suggests a rosetta stone, a solution that unlocks other solutions and, possibly, a financially sustainable path for media.
Such at least was was the underlying promise of a day-long confab I attended recently at Toronto’s spanking new Globe and Mail Centre. The roster of speakers was impressive, and I was eager to sponge up every scrap of wisdom from “industry leaders collaborating on current challenges and emerging solutions in journalism.” And maybe along the way I’d learn something useful in how engagement can lead to ever-elusive revenue.
The day, organized by the Online News Association, was divided into two tracks, one on revenue and the other engagement — I moderated an afternoon discussion on “difficult conversations.” What interested me was the opportunity to peek under the hood of media orgs with strong or promising business models and see whether “engagement” is or isn’t helping drive those efforts.
I was especially curious to hear from opening keynote Britt Aboutaleb, the newly named general manager of Eater and Curbed, the food and real estate/home decor sites at Vox Media (she’d been previously been editor-in-chief of Racked, their fashion offering). The session, moderated by Matthew Ingram of the Columbia Journalism Review, promised to explore a range of issues, including “honing your editorial voice as a business strategy and positioning yourself for growth.”
With the entire industry immersed in a collective struggle to achieve profitability, the Vox approach seems primarily focused on scale as its not-so-secret sauce.
Vox is generally considered a healthy news organization, despite having laid off 50 employees (5 percent of its workforce) in February. With the entire industry immersed in a collective struggle to achieve profitability, the Vox approach seems primarily focused on scale as its not-so-secret sauce.
In a recent statement, the Vox company chair declared that “trust, engaged communities, authentic voices and financial discipline are in,” but didn’t elaborate. And Vox is not among the news outlets I’d seen featured in deep dives into questions of audience revenue and engagement strategies.
I wondered: Does engagement play a part in the Vox revenue model? If so, how?
“We write about the stuff that we’re obsessed with, for people who are obsessed with stuff.”
Aboutaleb said that one of the things that appealed to her about the Vox sites she’s helmed is that each has a singular focus. “We write about the stuff that we’re obsessed with, for people who are obsessed with stuff.”
She talked about creating quality content, zeroing in on niche audiences, such as millennial women shoppers and about developing a strong brand. “There’s no pressure to be everything to everyone,” she said.
She described her decision, while at Racked, to stop using Chartbeat and instead focus on measuring audience growth through newsletters and Facebook video. The latter led to huge leaps in audience but no revenue (Racked’s video team was scrapped as part of Vox’s February retrenchment). She talked about Curbed’s Instagram feed, and about affiliate linking — articles containing content links to a service or good in exchange for revenue, saying that Vox was “the first place I’ve worked where we’ve disclosed them.”
All the while I waited for the mention of “engagement,” eager to hear how a well-funded, forward-thinking news provider was transforming its relationship with its audience, and thus escaping the ad-driven race to the bottom (and the bottom line).
Voice “is everything. People will follow that voice wherever it goes. That community, that loyal audience, is how you make the magic happen.”
Aboutaleb did give a passing shoutout to an Eater newsletter with “super-high engagement.” But the closest the conversation got to a substantive discussion of the topic was her emphasis on the value of “voice” — a particular tone and perspective that audiences might have formerly associated with a blog and now might seek out in a newsletter or social media feed. Voice, she said, “is everything. People will follow that voice wherever it goes. That community, that loyal audience, is how you make the magic happen.”
She also said, with a note of surprise, that while she was at Racked some newsletter recipients emailed back. “That had never happened before,” she said. “That was really cool.”
Yet there was no sense that this giant hint from the audience had led anywhere, and when Ingram asked Aboutaleb to name the top referrer for Curbed and Eater, she said she didn’t know. “That’s a good question,” she said. “There’s a very diverse flow of audience. A lot of people just go straight to the site.”
I found the absence of a stated connection between voice, engagement and revenue puzzling, and during the Q&A I asked about Vox’s revenue model. Aboutaleb listed Vox’s branded in-house content studio, display advertising, events, podcasts, affiliate links, a range of television and other video programming including Netflix, Twitter and CNN, and their ad marketplace, called Concert, which other businesses can buy into, thus enhancing their scale.
Only one of these — events — is directly tied to engagement. Noticeably absent was any mention of a deeper dive into audience desires (these are, after all, sites focused on things to buy), or the kinds of membership or subscription models that many news organizations are embracing.
When I followed up with a question about whether Vox is profitable, she said no. But they’re aiming for profitability within the next few years, she said, and are “doing very well in a not-great market.” In response to another question she said that Curbed’s short-term Small Fix newsletter is intended to engage with audiences, but not as a revenue generator.
So is Vox banking on engagement on its path to profitability? I’d say, at least for now, the answer is no. Hmm. For a conference focused on engagement and revenue, this was a surprise. And, maybe, emblematic of a disconnect between old habits tethered to the blunt instrument of scale and new habits that have yet to be fully understood, much less embraced (building relationships with audiences, gathering feedback, having a conversation).
But not all was lost: The next session was a complete 180. It featured the New York Times’ newsletter guru Elisabeth Goodridge and Scott Adams, the Globe and Mail’s director digital subscription product development. Both are laser-focused on the role of engagement in shoring up relationships with their audiences. “Yes people hate email,” Goodridge declared at the start (not rubbing her hands together, but she could have been). “But they love email newsletters.”
The session kicked off with moderator Kim Fox, managing editor of audience for the Philadelphia Inquirer, letting the audience know there would be no discussion of proprietary revenue numbers (so much for that glimpse under the hood). Still, there was a clear sense from both Goodridge and Adams that revenue was very much a part of the engagement equation.
The New York Times has found that email newsletter subscribers are twice as likely as non-newsletter subscribers to become digital subscribers to the paper, and Adams said that the Globe and Mail has just substantiated a similar finding — it is significantly more likely to retain digital subscribers if they also subscribe to a newsletter.
Adams said some Globe and Mail newsletters are headline-driven and low-touch, where “the purpose is to drive people into the meter,” meaning the user exceeds the free content threshold and then pays for continued access. Others, he said, are much more interactive, including Amplify, a new offering written by a rotating cast of women staffers at the Globe and Mail, created after ample testing and listening to what the audience wanted.
In general, Adams said, “People aren’t going to come to the Globe and Mail to pay for the newsletters, which don’t lead to subscription conversion. The role of a newsletter, he said, is as “a tool for engagement. It makes it easier for people to find the content they want.”
Now we were getting somewhere! The notion that engagement can help news organizations meet people where they’re at, understand their needs, and deliver the content they need or want, when and where they need it is a promising one (I’m not impartial on this point — it’s what drives GroundSource, the engagement platform where I’m chief storyteller).
Other speakers throughout the day echoed the emphasis on engagement as a key to revenue. Jeanette Agesen is chief revenue officer at The Tyee, an independent online news magazine based in Vancouver. At The Tyee (a word which means both large salmon and chief), there’s a focus on master classes and skill-building workshops, and nearly a third of the publication’s revenue comes from reader contributions — the company lays out its revenue model on its website. A couple of times a year, Ageson goes to editorial with the message that “okay it’s time. It’s time to sing for your supper,” she said. “They just know.”
Another example of an engagement-driven newsroom is The Discourse, a Canadian site which recently reconfigured on a membership-driven model. “We try to set the table for conversation and foster dialogue,” said Anita Li, director of communities. And yet another is WhereBy.Us, which runs local news sites in four U.S. cities (and which is in the beginning stages of using GroundSource to connect with audiences and communities). Storytelling director Anika Anand identified engagement as a key stage in the company’s “growth funnel,” which starts with awareness, then moves to engagement, subscription, ambassadorship, and, finally, membership.
And so, by the time I sat down to moderate an afternoon session my head was full of revenue models. While the bulk of the conversation focused on the impressive audience engagement work of Sarah Alvarez, founder of Outlier Media in Detroit and Stephanie Brown, senior producer at CBC Indigenous, we carved out a chunk of time to touch on revenue as well.
“The journalism that is the most engaged is often treated like a pet project or a charity project,” Sarah Alvarez, founder of Outlier Media, told attendees. “That is not the way I think we should think about this work.”
Alvarez was frustrated with the day’s separate tracks for revenue and engagement. “The journalism that is the most engaged is often treated like a pet project or a charity project,” she told attendees. “That is not the way I think we should think about this work.”
Alvarez is focused on Detroit’s housing crisis, and she reaches residents directly via text (using GroundSource), sharing customized property information she’s gathered through government documents and FOIAs. That work yields stories like this one, about a woman at risk of losing her home for less than the cost of an iPhone. After Alvarez’s story was published, the state promised to look into the case.
Alvarez’s entire journalism enterprise emerged from, yes, engagement. Now, she says, her biggest challenge is finding a way to financially support the work. “I really was focused on getting the journalism right, and the news product right first, and so now my challenge is okay, time to grow up. We got that, now what’s next?”
And so, by nightfall, a clearer picture had presented itself of how the industry is working through the engagement equation.
Broadly speaking, engagement strategies and the media organizations who employ them fall into three groups: Group one includes Vox and a subset of other large news outlets for whom “engagement” is still very much measured by the numbers — a model which may prove workable for a few of the big guys who join forces with the other big guys to become the even bigger guys, and whose offerings include commodified sites centered on things people want to buy.
The second group includes the New York Times, the Globe and Mail and most other participants at the event, who don’t see a future for themselves in ad-driven, scale-based media business models and are deep into developing new revenue models built around engagement.
At engagement-driven public service news outlets the work is clearly worthy, but how to pay for it?
Outlier’s Sarah Alvarez belongs to what might be considered a third group: those driven by a journalistic commitment to a social good that begins with listening to communities — especially those historically under-served by traditional media — and meeting their information needs, but which has no clear path to monetization. The work is clearly worthy, but how to pay for it?
That’s among the many questions that remain unanswered. Sometimes progress is more about the search for questions than answers, though, and on this score, there are many in journalism dedicated to pressing ahead.
