I finally got around to some long-delayed reading today and am currently working through the “Blueprint for Complete Community Connection,” a document that’s been making its way through the journalism world since it was first published late last month. The blueprint, as I’ll call it, was written by Steve Buttry, the director of content for The Gazette in Eastern Iowa. Anyone interested in the future of journalism should read the whole thing. It’s well thought-out and contains dozens of fantastic ideas.
I was really interested by the third section, when Buttry begins to talk about revenue:
Revenue generation traditionally isn’t a journalist’s job, but helping develop a business model for the future of journalism is every journalist’s job today… Content and revenue must be planned together, so any innovation plan must address both needs.
First, I think a lot of old-school journalists would balk at the first sentence and to be honest, mixing business and editorial makes me queasy as well. But at the same time, Buttry is 100 percent correct and more and more journalists are beginning to accept this idea. A lot of the courses Christopher Wink is suggesting should be offered here are based around journalists becoming more informed about business models, etc.
Buttry goes on to offer several ideas on how to better link content and advertising. Basically, these ideas all revolve around goods being sold from a news organization’s website. The news organization would then take a cut of the profit. Buttry explains the underlying ideas:
Our approach will offer businesses a chance to pay based on performance, which gives them higher confidence as well as higher value. More important, it turns our company from an expense line in its customers’ budgets to a revenue line. The current advertising decision is a choice of making a commitment up front to a substantial investment based on the hope of generating significant business. In this recession and in the economic vise of a community recovering from disaster, we are seeing that when businesses are cutting expenses, advertising is a large expense without an obvious dollar-for-dollar connection to revenue. It becomes an inviting place to cut. But advertising works, so the business that cuts advertising sees its revenue decline (but may not recognize the decline’s relationship to the decision to cut advertising, since the economy is such a handy scapegoat). So the business needs to cut expenses again and there is that advertising expense line — a bit smaller than last time but still inviting.
Generally, I think these are all quality ideas. But I do have three critical thoughts:
- This gives the news organization a lot of incentive to sell the product, which raises all sorts of obvious ethical concerns. Yes, journalists can consider the business side of the operation while still remaining ethical, but putting links to make reservations or buy gift certificates next to restaurant reviews seems to be a step too far. After all, that means a negative review could directly lead to decreased revenue for the news organization. Bulwarks against this need to be installed.
- This also gives the business free advertising, because even if people don’t buy a product right away, the business is still getting their name out there and possibly leading to future business that doesn’t come directly from the newspaper’s website. But the news organization doesn’t profit from this. There are ways around this, of course (i.e., charging a flat rate and getting a smaller cut of the revenue).
- Lastly, they’re based off what I consider to be a flawed premise: people won’t pay directly for news content. Buttry – and a lot of other innovative journalism thinkers – don’t think people will be willing to pay for content. Their reasons for thinking so are certainly sound, but I’m not so convinced. People have paid for content in the past and will (or at least could) be willing to do so in the future. A recent PricewaterhouseCoopers survey indicates that people are willing to pay 62 percent of what they pay for print content for online content. The survey has caveats – younger users are willing to pay less than older ones, but it still indicates that charging people for content can at least be a part of the solution.
Perverse and Often Baffling 