Planning for revenue growth ft. Tom Lappas and Simon Owens

There are more revenue options than ever available to local independent publishers, from selling ads to launching a membership program to holding events to publishing sponsored content.

Of course, having more options also means having to make more decisions — and creating more opportunities for a revenue stream to fail.

In this episode of News Guest, our host Candice Fortman talks with LION member Tom Lappas and news business expert Simon Owens about how publishers can determine the right revenue sources for their business and avoid learning the hard way that a monetization strategy wasn’t a good fit. 

Tom Lappas is founder and publisher of the Henrico Citizen in central Virginia, and Simon Owens is a longtime journalist, marketer, and PR professional who hosts The Business of Content podcast and publishes Simon Owens’s Tech and Media Newsletter on Substack.

See below for a few excerpts from their conversation, and learn more about planning for revenue growth by signing up for LION’s newsletter and following this month’s series.

On making a revenue growth a priority as a fledgling news business

Tom Lappas: I was naive [when we launched] and thought, ‘hey, if we do a good job with this product, people will gravitate toward it and we will just get advertisers coming our way.’ A year or so later, I realized that wasn’t exactly how things worked. And then I started thinking more about ‘how are we going to generate the money that we need to keep doing this?’ But it took me probably two and a half years to even hire anybody on the revenue side. So just crazy.

On preparing for revenue growth by ‘owning your audience’

Simon Owens: If you look at conversion rates for both advertising and paid subscriptions and memberships, it’s about how much of a direct relationship you have with your audience. That’s why you’re seeing a lot of emphasis [on] things like newsletters, where you have a direct connection and there’s no Facebook-like algorithm separating you from your reader. 

Candice Fortman: What does it mean for a newsroom or a newsletter writer to own their audience?

Simon: A big part of it is having them opt into a newsletter and voluntarily give [their email address] to you. That’s incredibly important – that you don’t just spam people or add people without their permission. Another part is them actually knowing who you are, not just as a headline popping up on their Facebook feed, but [knowing] your name or the name of your publication so there’s some actual brand affinity there. 

On deciding to hire someone focused on revenue growth

Tom: I’m a journalist, and I had no training at all in revenue generation. It was not something that I wanted to do, but I’d just done it out of necessity over the years. [Before making a revenue-focused hire], I think you have to be in a place where you have done your homework. You need to know what audiences you’re reaching. You need to put together a whole plan for what that person is going to be doing, and who they are going to be targeting. You have to understand what their pay structure is going to look like. There are a lot of different ways to hire folks, and I’ve probably tried all of them at one point or another.

On doing audience research and using the insights to attract advertisers

Tom: About three years ago, we did a really in-depth survey with a university here in Virginia. It largely confirmed what we thought our readership looked like, but it was nice to be able to say, ‘here’s 1,200 survey respondents, this is who they are, and if you advertise with us, you know you’re going to be reaching people like this.’ It’s an investment, but if you’re going to get into the advertising game, it’s probably an investment you have to make.

Simon: Every time someone becomes a paid subscriber to my newsletter, I have an automated email that goes to them with the subject line, ‘what do you create and how can I help?’ The vast majority of the people who receive that email respond to it, they tell me what they do, what company they work for, all that kind of stuff, and then I take that and plug it into a spreadsheet along with their name and email address… I was able to utilize that information when creating my advertising page.

Listen to the full episode on Apple Podcasts, Spotify, or wherever you get your podcasts.

And here are four other ways that LION is helping our members and other independent publishers plan for revenue growth in September and beyond. 

• The LION-GNI Sustainability Audits and Funding program offers personalized business advice and up to $6,000 of funding to help independent publishers build more sustainable businesses. The deadline to apply for the next round of audits is Oct. 10.

• Our News Entrepreneur Academy includes a lesson on Launching a New Revenue Stream, and later this month we plan to add a new Assessing Growth Opportunities course that will provide frameworks for identifying different revenue opportunities and deciding whether an idea is worth pursuing.

• The Independent News Sustainability Summit in Austin this October will feature sessions on planning for growth, assessing revenue opportunities, launching advertising and sponsorships, growing advertising and sponsorships, optimizing your audience funnel and other revenue topics. The full schedule will be announced in early September, and you can register here.

• The 2022 GNI Startups Lab includes programs focused on managing money and risk, building and managing a team and planning for revenue growth. Applications are now closed, but we will announce the organizations chosen to participate soon. 

Want to learn more about planning for revenue growth? Sign up for the LION newsletter to get updates on this series and other resources and opportunities for independent publishers.