Sep 14, 2010

Cooking with oil

There’s an old saying in New York that describes work progressing at good speed: “It’s cooking with oil.” The phrase makes a lot of sense when one considers the tasty goodness that can spring from a bubbling deep fryer, just as long as that molten fat doesn’t bubble over.

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.

Sep 1, 2010

The is and ain’t of hyperlocal news (and pizza)

Some thought has been bounced around the internets these past two weeks on what it means to be hyperlocal.

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.

Jul 8, 2010

A few words from our panelists

I’ve said it before and I’ll say it again: I enjoy speaking with fellow hyperlocalists about the challenges we face. It’s my reason for getting up in the morning. That and emptying my bladder. Both are equally stimulating, the former on an intellectual level, the latter on a physical level.

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.

Jul 7, 2010

Getting mom and pop to go digital

Last spring, an advertiser with my now-defunct news site asked whether his restaurant should have a Facebook fan page. I told him yes, but my eyes burned an angry “hell yes,” and my foot ached to make contact with his ass for not already having a presence on the social-networking site. I also encouraged him to get his business on Twitter.

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.

Jul 2, 2010

It’s a small economy (formerly world) after all.

On Thursday I attributed the failure of The New York Times’ hyperlocal project in New Jersey to a bad business model. Its reliance on unpaid labor meant there was no need to generate revenue, which proved to be its Achilles’ heel when the volunteers and student interns didn’t materialize.

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.

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