I thought a lot and blogged a lot. I traveled to Denver, where I got to talk a lot. I gave birth to my kid nearly a year ago, and when the fog of labor and delivery lifted, I returned to thinking and blogging and talking. But one vital thing was missing: I wasn’t doing a lot. Classes were taken, presentations were attended, but I wasn’t applying what I’d learned. I was book smart, street stupid.

But that’s about to change. Right fucking now.

From this point forward, The Hyperlocalist blog won’t be a retrospective analysis or an experiment conducted in a vacuum. Instead, it will follow the development of my new hyperlocal venture — The Jackson Heights (NY) Herald. This will be an online business plan, a test of whether my ideas and those learned along the way will work in the real world.

Wish me luck. I’m going to need it.

Future blog posts will explore the presentation’s seven fists of revenue fury: expertise, events, membership, subscriptions, product sales, donations and advertising re-imagined. Jeremy Caplan, director of the J-school’s center for entrepreneurial journalism and that evening’s presenter, carefully framed these revenue streams with startup businesses in mind, though even experienced hyperlocalists will find them worth a second look.

No discussion of revenue can start without an examination of audience engagement and its importance to the survival of any small business. I’ve yapped previously about a news outlet’s “emotional” value, how the interaction between reporter and reader through a website’s comments section can influence offline, real-life decisions. Advertisers appreciate that influence and recognize how it can work to their advantage. (They can also fear and loathe that influence — Yelp, anyone?) Unfortunately, emotional value as I’ve described it can’t be easily quantified.

Enter Facebook, Twitter and every other form of social media available. One way or another, they all display the number of users who follow a news organization’s account, and engagement is evident through wall posts and retweets. Emotional value finally has a number that advertisers can understand. Thank you, Mark Zuckerberg!

The best part: it doesn’t matter if a news organization’s social-media activity detracts from its website’s page views, declared Miral Sattar, founder of the niche site Weddings.Divanee.com. The organization’s influence will continue to have value as long as it engages its audience, whether on its own site or elsewhere, she said during the CUNY J-school presentation.

For example, Sattar’s wedding-oriented site recently asked its audience to choose the best-looking engagement ring from a series of photos posted on its Facebook page, with votes recorded as “likes” for individual images. The activity did nothing to drive participants to the main website (ie, it did not increase the number of page views), yet it demonstrated to potential advertisers the website’s engagement and influence with its audience.

A note on social-networking numbers: bigger isn’t always better. If an organization has to follow 20,000 Twitter users just to get 15,000 to reciprocate, then that’s not value. That’s volume, the same game played by Patch and other large-scale hyperlocal operations. And it’s a game that small, independent hyperlocal sites won’t win.

Even emailed newsletters demonstrate engagement and influence to potential advertisers, Sattar and Caplan described. A long list of subscribers shows readers’ interest in the news outlet (or at least a reluctance to mark the newsletter as spam).

Furthermore, email is still considered a more personal, private form of communication, the speakers suggested. To advertisers, it means an organization has more than its foot in the reader’s door — it’s sitting in that reader’s living room, playing with the family dog, eating chips on the sofa and watching “Glee.” That influence and intimacy counts more to neighborhood advertisers than page views and search-engine optimization.

Every four years, journalists descend upon Iowa, stalking would-be leaders of the free world as they shake hands, kiss babies and eat their weight in pancakes. However, the upcoming 2012 campaign season promises to have a hyperlocal twist to it. Arianna Huffington, newly appointed overlord to AOL’s content-producing properties, plans to use Patch.com editors to cover the election on a “granular” level, she told The Washington Post.

Huffington’s plan is genius: employ an army of already-embeds who won’t need lodging or driving directions, and let them lay the foundation for AOL’s larger, search engine-savvy campaign coverage. “We will have thousands and thousands of people covering the election. Covering the Republicans. Covering the Democrats. Just being transparent about it,” she said.

And that’s when my heart sank. Reporting on elections can be a major drain on hyperlocal news outlets, especially those with limited human resources. So how the hell are independent hyperlocalists supposed to compete with myriad minions of The Huffington Patch?

First, they can beat Patch to the punch. Indie hyperlocalists in states with high-profile primaries (Iowa and New Hampshire, for example), as well as those in the convention cities of Charlotte and Tampa, should immediately contact larger news outlets and promote themselves as location experts. If AOL can use its hypothetical Des Moines Patch editor (more likely, someone from its Seed content farm) to blanket the Iowa caucuses, surely The New York Times and CNN can pay Cedar Rapids‘ independent hyperlocalist to work the beat.

(Incidentally, hyperlocalists from Super-Duper Tuesday states are not shit out of luck when it comes to milking the campaign coverage. They can similarly promote themselves to NPR or some other large outlet as experts in their beat’s hot topic — unemployment, gay marriage, the effect of prolonged deployment on military families, whatever.)

Notice my use of the word “pay.” The time and energy required to cover a campaign deserve appropriate compensation from whomever is doing the hiring. National exposure will not fuel a hyperlocal news outlet while its resources are diverted to the campaign trail.

To earn that living wage, independent hyperlocalists must offer coverage that encompasses more than just the who, what and where. The material must deliver a distinct local flavor and offer unique insight into how political events and the populace interact. This connection with place, and the ability to drop a reader smack in the middle of it, will distinguish the independent hyperlocalist from a Patch editor or embedded big-media reporter.

Ultimately, if a hyperlocal news site can’t beat Patch’s campaign coverage, it should join it — sort of. Local Patch sites likely will create RSS (syndication) feeds for their campaign stories, which can then stream onto a hyperlocal news site’s sidebar. Thus, the independent hyperlocal site offers its readers a portal to political coverage without having to create content.

Photo courtesy of Flickr user Carl Wycoff.

One thing that didn’t get past my sleep-deprived eyes during my maternity leave was news that TBD.com was ending advertising sales for its affiliates. Launched last summer, TBD reports local news in and around Washington, DC, and serves as a portal to more than 200 hyperlocal news sites and blogs. The idea behind its affiliate network was to build sales strength in numbers: TBD would act as an ad server, and participating websites would get a cut of the advertising revenue.

Everyone and their brother watched closely to see whether this model would finally turn a buck on online local and hyperlocal news. But by the end of November, TBD announced it was pulling the plug on this program. “Unfortunately, the advertising aspect of the network has not taken off as effectively as the traffic and linking relationship,” Steve Buttry, TBD’s director of community engagement, wrote.

I’m not privy to exactly what went wrong, but here are some things an ad network might do to get things right:

Start small. According to TBD, one quarter — about 50 — of its affiliates participated in the ad network. But that number might have diluted its value. It’s the danger of doing a volume business: If demand can’t move all that ad-space inventory, then the ad server and its affiliates are shit out of luck.

Instead, a network of ten or fewer websites might offer advertisers a more targeted audience and, therefore, a more valuable piece of advertising real estate. The network might not sell as many ads, but it won’t have to if it can charge a premium for its space.

Love thy neighbor. Offering advertisers a targeted audience means limiting network affiliates to a specific geographic area, maybe a single county or city. In a large market like New York, a successful network might represent just two or three adjacent neighborhoods.

A network that stretches across several counties or states (as TBD’s network does) can actually lock out advertisers who draw on sizable yet geographically focused markets. The chain-restaurant operator knows whether her food is worth a 30-minute car ride across state lines, or just a stumble across the street. She won’t spend money to advertise with a large network if her only interest is in a local or hyperlocal market.

Work it like Goldilocks. Sure, everyone wants loving from big advertisers and their big ad budgets, and no one wants to hustle for ad revenue from mom-and-pop shops. But an ad network might succeed in courting regional sponsors who have modest ad budgets and value the opportunity to speak and sell directly to core markets. It’s an approach that’s not too big, not too small, but just right.

I don’t know how much (if any) of this advice addresses TBD’s specific woes, but I do hope they find the right fit for their business structure. Git ‘r done.

Illustration of Larry the Cable Guy courtesy of Joe Bluhm.

ZING! It hurt like hell, but it was the truth. When news audiences receive free content, they no longer count as customers. They’re not dropping coin to keep the lights on or the servers running. They don’t pay for writers’ salaries. And even if they contribute “emotional” value to a news outlet through reader comments, that value doesn’t do jack for a business if it doesn’t translate into dollars and cents.

In my previous attempt at hyperlocal news, I placed the audience’s satisfaction ahead of business development. It was a colossal mistake. Readers loved my frank restaurant reviews as much as restaurant owners hated them, and that meant an enormous loss of potential advertising revenue from the neighborhood’s largest industry.

This time, I hope to develop my audience and customer base simultaneously without jeopardizing the quality of my publication’s content. Here’s how:

Extend services unrelated to my publication to residents and the business community. One of the revenue streams I plan to pursue is group-discount brokering (the Groupon model). To make it work, I need a mailing list of prospective shoppers (an audience) and business customers willing to offer these shoppers a discount. To build this mailing list, I plan to attend local meet-ups to learn what residents want or need from their community, and to gently introduce the idea of group discounts. Call it market research.

That information becomes leverage when approaching business customers for group discounts. It also brings together an otherwise non-paying audience with paying customers, without selling out a news outlet’s integrity.

Build my publication’s audience slooooooowly. Since setting up a beta site earlier this month, I’ve posted only two stories. But I’ve used Twitter to publicize my organization as a news source, mostly by retweeting neighborhood-specific stories from larger news outlets and by posting photos. So far, I have 13 followers, and that’s fine with me.

This modest following allows me to test different things, from writing style and voice, to website design. The publication’s slow, deliberate development also gives me the opportunity to educate customers (in this case, advertisers) on how my business operates, not as a quick hustle but as the next evolutionary step in advertising.

Those are my first two steps in building the business, though I should keep a few spare ideas in my pocket should neither of these approaches work.

Photo courtesy of Flickr user chillhiro.

Well, I’m proud (and terrified) to announce that my new hyperlocal project is “cooking with oil.” The beta site is running, the Twitter feed is tweeting, and a Tumblr blog is tracking its progress. Cosmetic improvements are in the works, as is a mobile-friendly site. With luck, the full Monty will launch next spring.

But there are a number of questions on the business end that need answers, or at least clues. How does one conduct market research on the hyperlocal level? And who or what constitutes the true market? How far does personality go in promoting or harming a publication’s success?

I’ve had Twitter discussions (twiscussions?) with fellow hyperlocalists on some of these matters, and I’ll share their thoughts and my own in the next few posts.

Photo courtesy of Flickr user SETmariposa.

Sarah Hartley, editor of Guardian Local in the United Kingdom, last week characterized hyperlocal news in ten bullet points. Some of them were on the mark: participation from the author and the community, a willingness to link to outside sources, a spirit of independent coverage, and (sadly) a general state of shit brokeness. Hartley also threw in the characteristic of “opinion blended with fact,” though I’ll argue the act of weighing another’s objectivity is a subjective exercise.

Hartley’s blog post is worth the read, though I’m tired of trying to define the nature of hyperlocal news. It is what it is, and it ain’t what it ain’t.

However, I’m in a twist over what Barb Palser, director of digital media with McGraw-Hill Broadcasting, called the hazards of hyperlocal. In the June/July issue of American Journalism Review, Palser described hyperlocal news as “difficult, expensive and not for the faint of heart.” The perceived low demand for hyperlocal news, plus market saturation by way of existing news outlets, startup websites, blogs and social-networking sites, makes it nothing more than a financially unsustainable labor of love, she wrote.

Is hyperlocal news difficult and not for the faint of heart? Yes. No one said it would be easy. Is it expensive? When one considers the cost of labor — I’m talking about the true cost, including all those hours that hyperlocalists put in for free — then yes, it can get expensive.

But those descriptors apply to any new business or industry. Replace “hyperlocal news” with “pizzeria” and the same holds true. Pizza’s a tough gig and can get expensive. The perceived low demand for fat-laden cheese on top of high-sodium sauce and carbohydrate-rich crust, plus market saturation by way of pizzerias and other fast food eateries on every city block, amounts to a financially unsustainable blah blah blah.

It’s not about the quantity and quick availability of that pizza — er, hyperlocal news. It’s about quality. Urban dwellers (and probably some suburbanites) have myriad options when it comes to where they spend their time and money. Still, they gravitate towards the service or product they feel is best, even if more convenient or cheaper options exist. It’s what I’ve previously called the “emotional value” that a business lends to its community, and with careful business planning that fits the local microeconomy, I believe it can be profitable.

Is being the best at one’s business difficult and not for the faint of heart? Hellz yeah. Can it get expensive? Perhaps. But there’s always demand for a better product — pizza, hyperlocal news, whatever. It’s up to entrepreneurs to supply that better product.

Photos courtesy of Flickr user Adam Kuban.

So it was with brainy interest that I spoke recently with Terry (whose real name I’ve obfuscated for privacy’s sake). Terry’s fighting the good fight, running a nonprofit investigative-news site in her state capital. But grants are tough to score and corporate donations have the potential to taint her organization’s objectivity, she told me. On top of that, the nature of investigative news calls for long-form and serial writing, not exactly page-view generators.

Terry has considered hosting meet-and-greet events to generate revenue, charging cover fees (or “suggested donations” in nonprofit parlance) for participants to nosh with influential people. Unfortunately, the costs to organize, advertise and cater such events take a serious bite of whatever slim profit is possible, she worried.

My suggestion: Turn these events into a double-whammy volume business.

First, the volume part. Instead of holding cozy meet-and-greets in restaurants and charging higher fees to cover food costs, it might benefit Terry’s organization to host panel discussions in large spaces. A college or private company might be willing to donate use of a lecture hall or conference room, and a local caterer can donate light refreshments (though food always makes post-event cleanup a pain). On top of that, politicos and corporate spokespeople are usually willing to spout their agendas for free when given the opportunity to serve as panelists.

Such a setup allows Terry to suggest small, palatable donations at the door from a larger audience. It also reduces her overhead: So far in this scenario, Terry’s organization has spent zero dollars on space, food and speakers, and has gained a per-capita cover charge. Sweet, huh?

Here’s the double whammy. Terry can record such panel events for later broadcast on her organization’s website, for download as a free podcast, or as audio or video content for paid syndication. Delaying a broadcast gives value to attending panel discussions in real time, but it also allows those not in attendance to benefit from the information presented.

Most of all, delayed broadcasts can drive page views (read: advertising dollars) to a site, especially if a discussion topic or panelist sparks heightened interest between the live event and the recorded show. That kind of action also increases a program’s syndication value.

One event, two sources of revenue. BAM! BAM! A double whammy.

For-profit news organizations can duplicate this, though it might be harder to find donated space and food. Still, I predict a private college would be glad to host an event in exchange for sponsor status and the appearance of an esteemed professor on the panel.

I hope Terry and her organization can reap some revenue from producing these or similar events, as they would benefit the host and audience members alike. For more information on keeping investigative journalism afloat, check out American University’s iLab. Keep running the good race, Terry!

Photo courtesy of Flickr user Stacie Joy for CTTC.

That’s when his eyes glazed over. “What’s Twitter?” he asked.

I tried my best to explain it: 140-character squirts of information broadcast to followers, who then might rebroadcast (or retweet) that information to their followers, and so on. My advertiser didn’t see its value; admittedly, I didn’t do a good job illustrating it to him. It just seemed like a lot of work that he didn’t really need.

He was right. Digital marketing can be a full-time job, or at least a labor-intensive one for a small, neighborhood business. Mom and Pop Shopkeeper can’t spare their first-born child to tweet daily specials or post notes on a Facebook wall. That kid needs to be at the register or on a bicycle making deliveries.

The Tribune Company stepped into this tough sell earlier this week and Gannett started in late May. But they’re onto something: Digital-marketing services are certainly a revenue stream that allows online hyperlocalists to leverage social-networking skills they already have (or at least should have).

Making this work means first educating small business owners on the value of Facebook and Twitter (I’ll toss in Foursquare while I’m at it). That can be done one-on-one during a sales call, or in a free presentation to the chamber of commerce or other local business groups. The goal is to introduce business owners to the concepts of social networking and not to instruct them on exactly how to use it. They won’t buy the cow if they can get the milk for free.

Next, it might mean scaling a digital-marketing campaign to fit a business’s needs and budget. A restaurant might have plenty of information to post on its Twitter and Facebook feeds, and such a business can use (and afford) the help of an online hyperlocalist to set up those accounts or create content.

Conversely, a corner convenience store might not have much to say, but one inexpensive “sponsored” tweet on a hyperlocalist’s Twitter feed can extend its services to an online audience.

I’ve had some success offering digital-marketing services to small businesses: I ghost-tweeted text and photos for a local crafts fair using that business’s Twitter account, and transmitted teaser tweets through my news site’s feed. I also convinced the restaurateur mentioned above to purchase tweet time on my feed, though as part of a larger display-ad package.

In the interest of transparency, each tweet appearing on my feed was labeled “sponsored.” Likewise, any mention of the crafts fair or that restaurant in the website’s content included some mention of them as sponsors or advertisers.

Digital marketing is a professional service and revenue stream that online hyperlocalists should consider, especially since Facebook, Twitter and Foursquare are well adapted to mobile devices. It’s an easy way to break into mobile monetization with existing technology.

Photos courtesy of Flickr user Jeremy Keith and Tommaso Sorchiotti.

I still think this model sucked, but it wasn’t just a bad business model. It was the wrong business model for that area. Here’s why.

To keep the New Jersey Local running, The Times would have needed a large pool of unpaid student interns. They have that for their New York hyperlocal sites, with more than 480,000 students in the City University system, which includes a J-school and at least two colleges with strong writing programs. CUNY’s J-school already mans the Brooklyn Local, while students from New York University’s journalism program will work the upcoming East Village Local in Manhattan.

The Local didn’t have that in its New Jersey beat, which covered Maplewood, Millburn and South Orange in Essex County. Seton Hall University sits in the middle of South Orange but has an enrollment of only 10,000 students. Nearby Montclair State University has 18,000 students, and the Newark campus of Rutgers University has 11,500 students. There wasn’t enough wiggle room for error or missed partnerships.

The take-home lesson from the New Jersey Local experiment is this: Hyperlocal business models aren’t always about scale. What works in a large market won’t necessarily shrink to fit a small market. Instead, hyperlocalists must put attention into their beats’ microeconomies. If a neighborhood can’t support a news outlet’s business  model, then that model needs revision.

For example, my former hyperlocal site’s business model relied on advertising revenue. However, my coverage area was underdeveloped as far as businesses and services go — advertisers didn’t exist, and The Great Recession didn’t help. On the flip side (and contrary to what was happening across the larger region), the neighborhood had plenty of homeowners’ associations unaffected by the mortgage crisis and very active in civic affairs.

My for-profit company spent three years trying to tap blood from the advertising stone. It would have been better off as a nonprofit funded through donations from those homeowners’ associations. Woulda, coulda, shoulda.

Scale does not equal sustainability or solvency. That goes for The New York Times and independent hyperlocal outlets. But an appreciation for what a neighborhood can support will go a long way.

Photo courtesy of Flickr user pillowhead designs.