An indie publisher on monetizing local news with sports, mobile and agency services
Steven Ludwig, the CEO of BIGR Media in Tennessee, is a local independent online news publisher, a LION member, and
Steven Ludwig, the CEO of BIGR Media in Tennessee, is a local independent online news publisher, a LION member, and a speaker at and sponsor of the 2017 LION Summit in Chicago Oct. 26-28. We asked him to share his experiences in helping pay for local journalism through monetization of local sports coverage, mobile strategies and serving as a marketing agency for his company's small business advertisers.
1. You've thought a lot about how to scale or grow your local news business. What advice do you have for publishers who want to grow but not necessarily expand their geographic reach?
Digital brands have the unique ability to develop communities around affinity. For us, that has meant developing/partnering with sports- and things-to-do-based brands so we can build additional communities around high school football, college or pro sports teams, and community events. Each of these tends to have passionate audiences and passionate advertiser groups that allow us the potential to grow without expanding our geographic footprint.
Out into the future, I also think we’ll experiment with developing brands that are specific for lead generation. One of our local partners has already designed two verticals: real estate and HVAC. Leads generated (home sellers, home buyers, homeowners who need a new HVAC system installed) are monetized by selling them to customers on a per-lead basis.
2. You'll be speaking at the LION Summit about monetizing local sports coverage. Should sports be a staple of every local news site, do you think it works particularly well in your market, but maybe not others, and how does a publisher determine whether the investment is worth the potential return?
We’re very metrics-driven, so the simple answer for me is if the audience wants to read it then it should be part of the site; if the audience doesn’t read it, it can go away without fear of loss. High school football in our area is a big deal; therefore, an opportunity for both readers and revenue. It’s also very competitive in our area because there are no less than four media outlets covering it. We are constantly assessing what kinds of coverage meet these criteria: (1) Can we do the best job on this content (compared to our competitors)? (2) Do people like to read this content? (3) Do advertisers like the idea of sponsoring this content? If we can reasonably answer yes to all 3 criteria, then we’re excited about it. If not, we need to re-evaluate.
Back to the example of high school football, we realized that our strength was never going to be long, detailed game summary articles. So we work with a crowd-sourced scoring partner to provide a real-time scoreboard of all 16 schools we cover on game nights. It’s popular, and people like to sponsor it. We also realized that the bulk of the page views were going to whomever published the final score first, so we have concentrated on being first with the score and basic game details. That’s working well in our competitive situation. We also developed a relationship with SONIC that allows us to compensate parent/student reporters at each school who feed scores, photos, and game information for each team (home and away games) in exchange for SONIC gift cards as compensation. That’s working pretty well, and I think we’ve set the stage for 100 percent participation next year. This keeps our investment low and means we can do high school football coverage profitably. It required creative thinking, though.
3. You've branched into providing web development, social media and creative services for advertising clients. In what ways does the mindset of a local publisher need to change in an "agency" model like this?
It’s really an entirely different business. About 40 percent of our revenue is now tied to services. And since we are committed to local implementation, that means our cost basis is high; but we’re growing into our capacity and we’re roughly three to five additional clients away from reaching our goal of 40 percent gross margin on service business.
When you’re providing key services like web development, directory management, SEO, etc. you really make clients more bullet-proof. In our case, all services customers are also advertisers; but obviously not all advertisers are services customers. Another asset is that we have more landing points in the sales process. A prospective customer may not be in the mood to talk advertising, but has a particular pain point we can fix, and that moves the selling process forward.
Small and very small business customers are generally overwhelmed by the complexity of marketing, and it keeps getting more complicated. Customers don’t know what works, and every time they feel like they’re making headway it isn’t long-lived. Our company’s vision is to simplify marketing, take that off the plate of entrepreneurs, and focus on just delivering quality leads they can convert to customers. Being able to provide content and advertising using our own platforms, Facebook, Google, and other third-party platforms, and optimize each customer’s digital footprint (to be found and be useful to consumers) so consumers have a great experience when they engage is ultimately what will drive our business. Affinity-based content (news, sports, things to do) is how we’re building the audience and credibility it takes to bring it all together.
Ultimately, we’re betting that the audience awareness of our news, sports, and things to do brands will differentiate us as “trusted local experts” when it comes to services. If businesses believe we’re influential with consumers, they’ll see us as an important resource that can help them create new customers. We started 6 years ago with the idea that display advertising was not a long-term business model, and we still believe that. So diversity in our revenue streams will be important as display evolves, and keeps us from strategically relying on just one thing for our survival.
4. What percentage of your audience and revenue are mobile, and what advice would you give to other publishers on whether to launch apps or just focus on a mobile-optimized website?
We have had evolving opinions about mobile apps. First of all, let me say that two-thirds of our traffic any given day is mobile. We’ve invested heavily in making our sites as mobile-friendly as possible, focusing on Google’s AMP format – but making concessions for our advertising positions and other things important to our business model. We originally designed apps about three years ago, but decided against them because analysis showed we were going to severely reduce our advertising impressions (mobile app would yield about three ad impressions per page view, versus 11 ad impressions per non-app page view).
Today, we’re moving rapidly back in the direction of mobile apps; mainly because we see that as a way to improve the user experience (users ask us all the time if we have apps), and to begin registering users (creating accounts). Apps have the potential to open up per-user revenue streams through things like anonymous data aggregation that are recurring, have no cost of sales, and don’t involve intruding on the user experience. As a result of shifting environment, something we were running away from three years ago we’re now running toward; ironic.
We’re also intrigued by the potential of beacons and other technologies that will allow us to close the loop between advertising and the point of sale. What I mean by that is, we want to be able to go beyond clicks and CTR to actual foot traffic generated. If you think of ad impressions (and/or native content) as the top of the funnel, right now we show clicks, and that’s the “bottom” of the funnel. But if we can follow users and determine by geo-location or beacon pings who actually shopped our clients, then we can move the funnel down another level and show actual foot traffic converted. We think that has powerful potential. Apps help us do that, too.
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