Posts about hyperlocal

Sprouts from the ashes

May 28, 2020 by Jeff Jarvis
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Our house was already on fire; COVID threw gunpowder on the flames. In this piece for Tortoise, I surveyed the damage to our field. Now I will look at some hopeful sprouts rising from the ashes.

First, to be clear: There is no messiah that will save us overnight; our messiahs have all been false. We will not — and should not — return to journalism as it was; we must not lose this opportunity to rethink what journalism can be. Though I want to give them the benefit of hope, I fear the innovation required will not often come from incumbents as they are overwhelmed trying to save the business that was; but I still wish they’d try. The new journalism will not arrive big and fully birthed; it will grow from many small seedlings, many experiments, thus many failures. Patience is required.

Here I’d like to report on conversations I’ve had with three local examples I’m impressed with: Canada’s Village Media, Innocode’s transparency app, and a German paper’s experiment with delivery for stores.

Talk with Google’s senior VP for news, Richard Gingras, about local news (as I will be on June 10) and he will tell you that Jeff Elgie has the answer. I agree. He has a very good answer.

Elgie’s Village Media has the model of simple local reporting for three dozen towns of 50,000 to 150,000, some of its outlets owned by the Sault St. Marie-based company, some franchised to partners (including a few experiments underwritten by Google with McClatchy in Youngstown, Ohio, and with Archant in the UK). In Elgie’s model, the ideal town is a bit isolated, the kind of place where people are born, live, and work without commuting to the big city. Village Media isn’t perfect for tiny, uh, villages (though it has a town of 10,000 as a satellite to a neighboring market) or suburbs or big cities, at least not yet. Elgie says in his best markets residents have a local news habit; it’s easier to start a Village Media site in a town with competition or in which the paper just died, rather in one that has been a news desert.

Village Media sites provide just the value you’d expect from a local newspaper a few decades ago: town council doings, schools, crime, new businesses; it’s comforting in its familiarity. Each site has a handful of reporters covering what matters and Elgie firmly believes they should not waste time rewriting press releases; their sites post them, properly labeled. Village media provides the model and the technology.

Village Media sites are supported by — get ready for it — local advertising. It has not died. Elgie has creative offerings for local merchants beyond standard ad units, video, and sponsored content. There is directory advertising that is self-published by the local merchants, and “sponsored journalism.” That’s not as fearsome as it sounds. It’s underwriting as engaged in by public-radio stations: A sponsor is able to take credit for making it possible to offer coverage of, say, volunteerism or high-school sports or local arts. Village Media also has some programmatic advertising and — like McClatchy, Advance, and Stat — has instituted voluntary payment (read: contributions) in this crisis.

Now hold onto your hat: Even in the COVID crisis, Village Media’s revenue is *up* this April over last by more than a third, not counting growth in franchise fees.

Yes, Village Media sites lost advertisers in the shutdown. But it worked hard (like the German site I’ll mention below) to help them get customers. A major auto dealer that was ready to cancel has ended up spending more. Cities are advertising.

There are other, similar models out there. Patch in the U.S. spread like kudzu into 900 towns, blew up, and rose again from its own ashes, smaller. My area in New Jersey has TAPinto sites as well as independent blogs. In Geeks Bearing Gifts I extolled the hyperlocal blog as a building block of a new news ecosystem and then I confessed my over-enthusiasm, though there are still lots of great single-proprietor blogs serving towns. Every commentator about local news — and there are more commentators about it than reporters in it these days — is quick to complain that any model I propose doesn’t scale. Well, nothing will scale in an instant; that was Patch’s problem: thinking it could. Local is going to be spotty. For Village Media, the challenge is identifying and training the perfect local publishers; as a school, I’m drawn to help.

I’ve long taught our entrepreneurial students the C-A-R rule of media businesses: They must first build a critical mass of content before they can attract a critical mass of audience before they can get a critical mass of revenue. This meansan enterprise of the size of Village Media’s requires a low six-figure investment to get to break-even. Given that the model is proven and the revenue and margins are enviable, I see no reason that capital cannot be raised as loans to build new outlets all over the map. Think of it as a burger franchise and it makes financial sense.

What about tiny burgs that don’t fit the Village Media model? On my last trip outside New York, I got to sit down with Richard Anderson, the founder of Village Soup (no relation) in Maine and a great pioneer in online local journalism. He had thriving local digital sites and then unfortunately bought the local newspapers just before the crash and ended up selling the business. But he remains an innovator, working on how to serve towns’ needs for local government transparency and accountability without wasting time and resources on distractions. Anderson is working on an exciting idea I’ll tell you about another day, when he’s ready.

Anderson and I are inspired by a 2018 paper by Pengjie Gao, et al, that contends: “Following a newspaper closure, we find municipal borrowing costs increase by 5 to 11 basis points in the long run…. The loss of monitoring that results from newspaper closures is associated with increased government inefficiencies.” That is, transparency is good for local towns, schools, businesses, and taxpayers. In my state we have something called Sustainable Jersey, which certifies towns on a number of criteria — including public information and engagement — and they compete to improve.

This inspired another thought: call it transparency-as-a-service. What if transparency services offered a start — just a start — on the way to a healthier local information ecosystem? What if that could be a business? What if the client is the town? Is that a conflict of interest? Sure. So is advertising. Bear in mind that Benjamin Franklin was not only the publisher of a newspaper in Philadelphia but also the official printer of Pennsylvania and the postmaster at the same time. If Ben could manage it, we can.

I was sharing this thought with a Scandinavian media executive I respect and he told me I had to talk with Morten Holst of Innocode, which provides technology for many media companies. I mentioned my thoughts on transparency-as-a-service to Holst and he showed me the Sandefjord Citizen app they’ve already built. The client is the local government. The users are a third of the population of the town. The product is local data. With the app, users can sign up for alerts when building permits are filed (the town would rather people raise objections before v. after it is issued), get data on water temperature and snow plowing (it’s Norway), and send out messages on behalf of their local clubs and organizations.

No one would say such data transparency is sufficient to assure local government accountability. Journalism is needed atop this data. The Citizen app is just one piece of an impressive, larger local strategy Innocode has. In any case, why waste journalists’ time rewriting press releases about snow plowing? Why not, too, follow the lead of Chicago’s City Bureau and make citizens collaborators in covering meetings and gathering data? The journalists should devote their time to true accountability journalism, not just filling space. The more informed and engaged citizens are in their local government, the better for journalism, the better for the town.

My point here is that we need to cut journalism up into component parts so we can start smaller. As I said in this post, one of my students argued that when faced with building from ground up, one must choose whether to build transparency or service journalism and I would add community. You want to end up with all three, but you need to start somewhere. The Citizen app is an example.

Finally a note on local business and community. This headline in Germany’s Die Zeit struck me:

Translated: “The newspaper now brings beer. Many local papers are fighting to survive. But in the middle of the pandemic, the Mindener Tageblatt had an idea.”

I emailed the publisher, Carsten Lohmann, to learn more. What impressed me is that he empathized with the needs of his local advertisers and their customers and brought to bear what he could: his own newspaper delivery staff. The company had already decided to take a cost center — delivery — and turn it into a revenue stream. Then came COVID. Lohmann told me:

With our daily newspaper we reach about 45% of all households in the distribution area and pass through about 70% of all mailboxes. So it made sense to take other products with us on this route.

Since we have to collect business mail from our customers during the day and also deliver it for our printing plant and office supplier (a local Staples), we decided to offer this service to external customers as well.

In this respect, our logistics department is certainly already experienced. Nevertheless the project is a challenge. For example, we have invested in a new logistics software.

They have been delivering beer (it’s Germany), plus about 80 pair of shoes so far, and office supplies. Will this make him rich? Is it the elusive messiah? Of course not.

It’s not gonna make us a fortune. But it should and does help us to share our own costs with external customers and to intensify contacts with local retailers on several levels — or even to establish them for the first time. At kauflokal-minden.de(buy local — Minden) companies have registered with which we have had no business contacts so far.

This is not the only line extension the paper has developed. In 2003, it founded MR-Biketours and is now the largest provider of guided motorcycle tours to the U.S. By the way, when I told students in our News Innovation and Leadership program at Newmark about the Minden paper, my colleague Anita Zielina said the paper she once worked for in Austria, Der Standard, bought a local bread company and offered daily delivery of papers and rolls. Who wouldn’t want a nice Zimtschnecke with the news?

Many years ago, when I was still consulting, I set up a meeting with eBay and PalPal (they were still together) to investigate whether local newspapers could help local businesses sell online and deliver locally to compete with Amazon. The eBay executive said the problem was that local stores did not generally have inventory digitized, so it could not be presented for sale online. I wrote a business plan for a stores’ equivalent of OpenTable, which had to build a system for restaurants to manage reservations so those reservations could be offered online. It almost got investment and a team but then didn’t. More recently, at the Newmark J-School, we started a professional community of practice for ecommerce with a not-so-hidden agenda to convince and help publishers to open online stores (à la Wirecutter) to build a new revenue stream and a new set of skills around individualized user data. The group convinced one company to do this and it gained a new revenue stream of a few million dollars.

My point is that we need to build new journalistic enterprises, new models, new services, and new revenue in small ways. This is why I like the dialog-driven journalism of Spaceship Media, the collaborative journalism of Chicago’s City Bureau, the answers and advocacy that come from Detroit’s Outlier, the listening inherent in Tortoise’s Thinkins, the power-sharing of The City’s open newsrooms, as well as innovation from the incumbents: Advance’s texting platform Subtext; McClatchy’s and Archants experiments above, and service journalism from the Arizona Daily Star’s This is Tucson. They build a piece at a time.

At Newmark, we just announced that we are also thinking small to train individual, resilient journalists in our new Entrepreneurial Journalism program. It will prepare journalists to serve passionate communities by making email newsletters, videos, events, sites, texting services, books, and more — and to support their work by making money via Medium, YouTube, Patreon, book publishers, events, and so on. My colleague Jeremy Caplan will head the program.

None of these journalists is likely to get venture-capital funding and return 100x. None of them will instantly serve every town in America. None of them will solve all of journalism’s woes overnight. None of them is a messiah. But any of them could serve a town’s transparency needs or bring together a community to share with each other or find creative ways to earn money by serving local merchants. Any of them could rebuild journalism from the ashes as small sprouts. That’s what it’s going to take, when the fire is out.

Geeks Bearing Gifts: Beat Businesses as Building Blocks of News Ecosystems

March 5, 2015 by Jeff Jarvis
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The latest chapter of Geeks Bearing Gifts: Imagining New Futures for News is posted free on Medium. The topic this time, one of my favorites: beat businesses (hyperlocal, hyperinterest, vertical sites serving specific communities) as building blocks of a new news ecosystem. The opening:

Screenshot 2015-03-01 at 4.35.23 PM

In research conducted at CUNY’s Tow-Knight Center in 2009 and again in 2014, modeling the news ecosystem of a market the size of Boston and then of New Jersey, we found that beats can indeed be businesses. We found examples scattered across the country — and I emphasize the word scattered — of hyperlocal blogs covering towns or urban neighborhoods of about 50,000 people that were earning upwards of $250,000 to $350,000 a year, mostly in advertising revenue. It is grindingly hard work. To serve, attract, and maintain a loyal audience of sufficient size within the community, the blogger must feed the beast not merely daily but many times per day. She must constantly be out in the community, talking with people. She has to perform not just journalistic functions but also commercial functions, getting over the journalist’s common phobia of business — specifically of arithmetic, advertising, and sales. To do all that alone is nigh unto impossible, so the hyperlocal blogger often works with partners — sometimes spouses — and has to earn the trust and affection of members of the community as collaborators. She also has to grapple with conflicts of interest more easily compartmentalized in large news organizations with their still-sprawling organization charts and lawyers on call — namely, how to deal with a local merchant as a reader, a subject, a source, and often an official of the town as well as a customer, while maintaining her own independence and credibility. It’s tough. It’s exhausting. It defeats many who try it. But still, there are many examples of success — from Baristanet to the West Seattle Blog to Red Bank Green, from The Batavian to The Lo-Down to Watershed Post. These are people who care about their own communities, who want to serve them, who sacrifice their days and any prayer of vacations, who pour sweat equity into their enterprises with no hope of the exits that other entrepreneurs work toward. And thank goodness for them.

If you can’t wait for the rest of the book, then you can buy it here.

The almost-post mortem for Patch

December 16, 2013 by Jeff Jarvis
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Screenshot 2013-12-16 at 9.25.59 AMDavid Carr all but writes the obit for Patch today. One could quibble and say it’s not quite dead, that Aol plans partnerships for the ill-fated ganglion of local sites. Fine, but it’s still not wrong to look back and ask what went wrong.

Before he started Patch — and before he went to Aol and brought it along — Tim Armstrong called me into his office asking me to advise Patch. I was listed as an official adviser but never was; I just offered what advice I had for free, over coffee, as I did for many others working in hyperlocal. Patch didn’t take it anyway.

I still believe in Armstrong’s vision that local communities need local information. But now I fear that its slow, tortured fall could — in the words of a friend — bring nuclear winter to hyperlocal. Radioactive hyperlocal cooties. It shouldn’t be. The problem with Patch wasn’t Armstrong’s vision about the value of local information. It was execution.

1. Patch did not get its business model in shape before multiplying its mistakes times 900. The essential business assumption — that having one reporter and one sales person in a town is inexpensive — is right, as many mom-and-pop hyperlocal blogs have demonstrated and as we modeled at CUNY. Patch wanted to scale that. But it went about that the wrong way.

2. Patch could have been a network of independent local sites. That’s what I advised, using the model of Glam, which Samir Arora built into a top-7 internet property not by creating and buying and owning content but instead by building an ad sales network and technology platform that now serves 4,000 independent and sustainable sites (triumphing over iVillage). Patch could have been the local version of that, but in the model of old media, it wanted to own everything. I heard executives there vow to kill the queen of hyperlocal, Baristanet. Now the queen has the last laugh.

3. Patch never played well with others. It was secretive and aggressive. In the NJ News Commons — an open network that I helped start (with aforementioned former queen Debbie Galant and others) — a few dozen sites across the state are now sharing content and audience (and soon, I hope, advertising) using Repost.US and BroadStreetAds. Repost enables sites to make their articles embeddable on other sites. It also enables sites to blacklist other sites that can’t take their content. Most sites I know wanted to blacklist Patch because it had been so nasty to them. In an ecosystem, what goes around comes around to bite you in the ass.

4. Patch sold advertising on its sites in the old-media model. The local advertisers I talked with said it was too expensive and, given the audience, didn’t perform. What Patch could have done was sell not only a network of local sites with more audience, but also a menu of digital services to local advertisers. Our research at CUNY shows that local merchants need more than ads; they need help with their digital presences in Google, Twitter, Facebook, YouTube, and so on. That’s what I’d like to see local sites working on now.

5. Patch was patchy in its editorial quality. This one amazes me. Patch had staffs of editors. It could have trained its local reporters in a system like About.com’s. It could have templated basic coverage — e.g., here are the 10 things you must do when a big storm hits. Some Patches did good work. Some were dreadful. In my first meeting with Patch, I also advised them to get some life, some humanity in what they did. But they thought they were a technology company, that the secret to their success would be their proprietary content management system. No, the secret to success in hyperlocal is passion: caring about your town. That’s always what Patch lacked.

After the fall of Patch, some will say again that hyperlocal has failed but they’d be wrong. Hyperlocal works in town after town. What doesn’t work is trying to instantly scale it by trying to own every town in sight. That was Patch’s fatal error: acting like an old-media company.

Hyperlocal works on a hyperlocal level. It’s damned hard work, as any hyperlocal proprietor will tell you. Last week, I went to the first Christmas party for the NJ News Commons and like a proud Frankenstein, I scanned a room filled with people who work hard to cover the towns and topics they care about. This term, I had two hyperlocal sites from New Jersey in my entrepreneurial journalism class at CUNY and they both need help to get their marketing and revenue strategies working. Next term, we have a handful of would-be hyperlocal entrepreneurs and we’ll work hard to get their model right. Hyperlocal is a matter of fighting for the next hill.

Hyperlocal will scale — as it is only beginning to in New Jersey — by helping these independent sites in a larger news ecosystem bring together their content, audience, advertising sales for mutual benefit. Patch could have been that network. Instead, it thought it could own — it could be — the ecosystem. Nobody can do that.

Patches

August 7, 2013 by Jeff Jarvis
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Tim Armstrong says he will close, sell, or find partners for 300 local Patch sites to reach profitability.

I have a fourth option, Tim: Invest. Set up independent entrepreneurs — your employees, my entrepreneurial graduates, unemployed newspaper folks — to take over the sites. Offer them the benefit of continued network ad sales — that’s enlightened self-interest for Patch and Aol. Offer them training. Offer them technology. And even offer them some startup capital.

You could end up better off than you ever were by being a member of an ecosystem instead of trying to own it. It can grow faster — just look at how Glam became gigantic: by supporting a network.

I still believe in hyperlocal. You’ve always believed in hyperlocal. I don’t want to see retrenchment of Patch give the naysayers as chance to nya-nya us.

So please consider another path: shrink the company but grow the network.

Hyperlocal cooties

March 8, 2013 by Jeff Jarvis
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Another hyperlocal venture is struggling, and each time this happens, I fear hyperlocal gets more cooties. But I refuse to give up hope because there’s a reason for each fall, there’s much still to do, and it’s still early.

The latest: Carll Tucker’s Daily Voice (née Main Street Connect) closed 11 of its sites, lost its CEO and other executives, shut some offices, and fired a bunch of people to cut its burn from $500k to $150k per month, according to Street Fight.

In hyperlocaland, Tucker was known to be particularly cocksure, saying he had the secret and — in the surest sign of hubris — raising large amounts from investors. Some smirk at his fall. But if he can now survive, then I’ll celebrate.

Tucker’s mistake, like Patch’s, I believe, was in thinking too big too fast. Before they nailed the business and knew what worked, they multiplied the model and thus the mistakes, which only threw accelerant on their burns. Perhaps they also thought too big. I’m not sure hyperlocal can be big — that it can scale, in the argot and desire of investors. More on that in a minute.

But first, in other cootie news: Patch recently cut staff and I’ll argue as I long have that they are creating closed sites when they should be building open (and more efficient) networks. NBC* closed Everyblock, though I was never sure why it fit there. Village Soup died, and I would still like to know more about its specifics. TBD was murdered before it ever had a chance to live thanks to parental politics. Add these to earlier cootied corpses: The Chicago News Cooperative had neither a business model nor cash from donors. Bayosphere failed sometime ago and I think its founder Dan Gillmor would acknowledge a lack of a business model. It was sold to Backfence, and its founder, Mark Potts, has very generously shared his lessons learned. There’s a reason behind each one of these.

At the same time, there are hyperlocal sites that are proving to be sustainable. Unfortunately, it’s pretty much the same list we’ve had for sometime: Baristanet, West Seattle Blog, NJ’s TheAlternativePress, Red Bank Green…. We analyzed these blogs a few years ago at the Tow-Knight Center for Entrepreneurial Journalism at CUNY, and found local blogs that then were able to bring in upwards of $250k in ad and other revenue.

There’s something that ties the survivors together:
1. They are small.
2. They are the products of a great deal of hard work by very dedicated journalists/publishers.
3. They are very much a part of their communities (which makes it difficult to parachute in any kid just out of J-school, I’m afraid).

Hyperlocal is going to be built this way, a town or city neighborhood at a time, I think. Are there enough dedicated journalists willing to do this hard work and to risk and sacrifice better paying alternatives (read: PR or flipping burgers, for that matter) and to learn how to do culturally distasteful things for journalists like sell ads and do business? In New Jersey alone, we have 565 towns and given this state, each is an opportunity ripe for corruption that needs to be covered. Even if we say that one hyperlocal site could cover three towns (some are small), that’s still more than 150 bloggers needed. I’d say we have a bit more than a dozen in the state now. Is it reasonable to think we could get 10+ times more? No. But I’d be ecstatic three three or four or fives times more.

I think we see a model for what’s possible in blog-rich Brooklyn, where there are scores of local blogs. CUNY runs The Local there, now solo, after The New York Times pulled out of its hyperlocal endeavors (another cootie). One of my entrepreneurial students is on the way to starting what I think will be a great service there (more bragging about him when he’s ready). It is possible. But they all need help.

This is why I worked with Montclair State and the Dodge Foundation (where — disclosure — I’m an advisor) to help start the NJ News Commons in New Jersey. My hope — OK, call it a dream — is that it and others (like NJ.com, which — disclosure — I helped start and where I’m now an advisor) can help make it feasible for an unemployed journalist — and we have lots of them — or a caring community member to start a site to serve a community bound by geography or interest. Among the things the Commons will do to help:
1. Aggregate, curate, promote, and distribute the best of the content created by independent members of the New Jersey news ecosystem. Debbie Galant has started a content sharing network enabled by Repost.US.
2. Train local publishers in the skills they need: new media, journalism, and especially business. That’s just beginning.
3. Coordinate collaborative projects so the independent members of the ecosystem can do together more than any one can do apart. That is beginning and I think it will grow with coverage of Hurricane Sandy recovery, which will be helped along with grants coordinated by Dodge and the NJ Community Foundation.
4. Provide services, which we hope may include everything from health and libel insurance to technology platforms to make it easier for sites to start with less effort and risk.

All that is well and good but it doesn’t address the key question, the only question of hyperlocal: revenue. This is where commercial endeavors must enter. In our modeling at CUNY, we saw the need for this work in revenue:
1. Better ad sales by hyperlocal sites serving merchants with more than just banners but also helping them with their digital presences. At CUNY, we looked at the digital lives of 1,000 merchants in a city neighborhood and a suburban town and saw great opportunity to help them. I don’t expect every hyperlocal publisher to innovate this. They need help. But I see big business opportunity here for entrepreneurs (or Patch).
2. Ad networks that aggregate audience from independent sites so they can for the first time get a piece of revenue from larger advertisers. This is likely something that needs to be done by a larger local media company (e.g., a newspaper or broadcast outlet).
3. Explore new revenue opportunities, such as events and newsletters. We are sharing lessons from sites that have found these to be surprisingly successful.

Still, this is hard work. It’s guerrilla warfare, a hill at a time. And that gets us back to the question of scale and one more need: funding. Hyperlocal ventures are caught in a terrible chicken-egg omelette. Funders will back ventures only if they scale, if they’re bigger than one town. Promising scale is how Daily Voice, Patch, Backfence, Everyblock, and other local ventures got funding. Striving for scale is what made them each perhaps grow too far too fast. Maybe the truth is that hyperlocal won’t scale. One entity won’t own thousands of towns and their sites because the successful site is very much a part of the community. OK, but each of those small ventures still needs funding to at least cover loses until an audience and a set of advertisers can be served. Where will that money come from? Journalists aren’t rich — especially now — and don’t have rich friends and family.

The more we can create the hyperlocal-site-in-a-box for would-be local entrepreneurs, the better — giving them membership in larger revenue networks, methodology, technology, and services like insurance. That will lessen the start-up cost and the risk. But they’ll still likely need some money to get them started.

This is where I believe that local patrons, local media companies, and especially foundations should be putting their resources: not into supporting journalistic charities or into building yet more gee-whiz cool tools but into helping to start sustainable journalistic enterprises with grants or convertible loans. Some will be gifts. Some will be investments — not big, scalable, exit-strategy, Silicon-Valley, technology platform investments but investments the size of a bakery. We need more bakeries for news.

When it comes to the information needs of communities, I’m less concerned about national coverage — Washington will always be overpopulated by scribes and cable will overcover disasters — and more concerned about local, especially the very local. That is where I hope we turn our attention. I also hope we do not get discouraged by the occasional cooties.

* Note: I changed the reference to Everyblock from MSNBC to NBC at the suggestion of Everyblock founder Adrian Holovaty.