There is no shortage of interest within the newspaper industry about the promise that local online journalism, often dubbed “hyperlocal,” offers to the bottom lines of beleaguered companies. The industry has seen a fair number of ups and downs since 2005, when online journalists began to offer content geared toward small geographic regions. Large companies such as The New York Times, Gannett, and AOL have invested millions into solving the hyperlocal riddle, and the results have been mixed at best.

Like any other industry, there have been a number of failures by individuals, businesses, investors, and journalists looking to make a go of this exciting new format for delivering news. But among the failures, there are success stories that point to developing trends and the best strategies to build and sustain a profitable local news site.

The epicenter
New Jersey has been an incubator of sorts for the local online news movement. With home rule in effect, a specific municipality controls every inch of the state, which means most towns have a news-generating city council, local police and fire departments, and a strong sense of community identification and participation to keep reporters on their toes.

Traditional media companies in New Jersey have experimented with launching their own hyperlocal sites. Gannett launched injersey. com in seven towns across the state in 2009, reaching upward of 17 towns before deciding to close the sites in July 2011.

The New York Times also branched into New Jersey, launching The Local in early 2009 to cover the towns of Maplewood, Millburn, and South Orange. Just 16 months later, the blogs were shuttered and, as the Times’ Jim Schachter told Nieman Journalism Lab, “Large media organizations cannot afford to cover large geographic areas in a hyperlocal way using exclusively paid staff.”

On a more positive note, AOL has 86 hyperlocal news sites operating in New Jersey. The first Jersey Patch site launched in February 2009, and journalistic performance has been mixed since then. However, Patch was the first news organization in the state to break the news that Gov. Chris Christie used a state police helicopter to attend his son’s baseball game after he spent the entire year criticizing wasteful government spending.

So how does a state with an estimated 140 hyperlocal news sites help sustain and grow this new model for journalism?

Montclair State University has recently taken steps to help nurture local digital journalism in the state. With the help of the Geraldine Dodge Foundation, Montclair State is aiming to help these fragile and often-inexperienced news organizations survive the volatile shifts in the economics of journalism.

To make sure the program got off on the right foot, the university recruited one of the local online news movement’s earliest innovators, Debbie Galant, to run the program. According to Galant, the program will help journalists and innovators in all aspects of their business, everything from negotiating health and liability insurance to content sharing and distribution.

“What we’re hoping to do is build a news co-op for the state, sort of an Associated Press of local online news,” Galant said. “Hopefully it will enable sites to save money and be more efficient by working together.”

Revenue streams
Funding hyperlocal journalism efforts is one of many challenges facing journalism entrepreneurs looking for the opportunity to start and maintain their own site.

So far, in order to run a profitable site, selling ads is mandatory. But the key is to build an audience around your content before making any attempt to solicit businesses to advertise. In fact, most of the successful independent local news sites focused on creating interesting content first and operated for months prior to selling ads on their website.

Tracy Record didn’t start selling ads on West Seattle Blog until a year after she started publishing, but once she had a steady stream of online visitors she could count on each month, the key was setting the right price point for her advertising inventory.

“We see people who start way low. ‘Oh please, please buy an ad from me; I’ll sell you one for twenty-five bucks,’” Record said. “It’s very hard to raise your prices from a level like that to a level where you can survive as a business, so look at an appropriate starting level.”

Denise Civiletti also waited to sell ads on Riverhead (N.Y.) Local until she established a strong following online, even though her husband had lived in the town all his life and knew a lot of business owners who constantly bombarded her to let them buy ads.

“I wanted to build up content and have something of substance, and wanted all the tech issues resolved,” Civiletti said. “Before I’m taking people’s money, I needed to make sure I can produce.”

Dan Jacobson found the best way to sell ads for his new local news site, the Asbury Park (N.J.) Sun, was to stick to the basics, just like he does at his alt-weekly print publication, the triCityNews.

“The key to selling local ads is to keep the rates low and the terms simple,” Jacobson said. “I come from branding and marketing experience, so all this click-through stuff I’m not buying into, and neither are our advertisers.”

Some hyperlocal news sites have moved toward events as a way to help fund their journalistic enterprises. Lance Knobel, co-founder of Berkeleyside (Berkeley, Calif.), had experience planning large-scale events, and brought that experience with him to help create events to benefit Berkeleyside’s bottom line, while at the same time staying true to its mission of helping the community.

The Berkeleyside team has created and developed local business forums. The last event, called “Startup Berkeley,” focused on the strengths and weaknesses of local start-ups, how to harness innovation, and how to nurture the local start-up climate.

Among the speakers Knobel recruited were Will Wright, founder of the video game company Stupid Fun Club, and David Hyman, founder and CEO of streaming music service MOG. The event was a success, both for the community and for Berkeleyside, with more than 200 paid attendees.

Ned Berke, founder of Sheepshead Bites (Sheepshead Bay, Brooklyn, N.Y.), also devotes time and energy to developing events. He is currently gearing up for the second annual “A Taste of Sheepshead Bay,” which brings together about 20 restaurants and several hundred community members, as well as food critics from all around the city.

“Not only is this great for our profile, but it really gets the businesses’ names out there,” Berke said.

A well-funded collection of local news sites serving New York City, called DNAinfo, created an online marketing conference for local small businesses, where the top minds in online marketing, including representatives from Google and Foursquare, present ideas to help small businesses improve their online marketing savvy.

“It’s important for us to help local business be successful across the board,” said Leela de Kretser, editorial director and publisher of DNAinfo.

DNAinfo also has found success revamping traditional legacy media properties and introducing them online for readers. In addition to its holiday gift guide, the site had a great deal of advertiser support for its back-to-school guide for NYU and Columbia, which is distributed to college students throughout the city.

Michael Shapiro, owner of another New Jersey hyperlocal called The Alternative Press, has begun franchising his existing Web model to surrounding towns for people looking for the opportunity to start a site in their own area. Right now, Shapiro has nine licensed sites up and running, with a tenth on the way Oct. 1.

“There are so many journalists out there who would love to start a hyperlocal for their town. We enable them to do so quickly at a very low cost and give them all the tools they need to be successful so they can focus on growing their business,” said Shapiro, who is also planning on launching several new revenue streams in 2013 for The Alternative Press, including sponsorships of the popular daily e-newsletter.

Ben Ilfeld has been a pioneer in terms of developing unique ways to monetize and fund his local online news site, Sacramento Press. In addition to standard banner ads, Ilfeld has developed a local advertising network called SLOAN (Sacramento Local Online Ad Network). It allows other websites to carry ads sold to the network, and the reach has attracted a wide array of advertisers. “Even though a large amount of revenue gets split to other publishers, it’s important for the health of our community,” Ilfeld said. “It’s better if we have a business relationship with other niche sites in the city.”

Ilfeld also does social media consulting — everything from building business sites in WordPress to advising on social media strategy. “Sacramento isn’t the best economy, so we have to make sure our clients are successful,” Ilfeld said.

Driving traffic
Like most community newspapers across the country, the best tool online news sites have to promote themselves is to be out in the community, reporting on everything from little league baseball to the local farmer’s market.

Berkeleyside has developed a strategy to partner with traditional media sources to drive traffic to its site. In a content-sharing arrangement with the San Francisco Chronicle, snippets of Berkeleyside stories appear on the Chronicle’s website, with a link back to Berkeleyside for readers who want to finish the story. Sometimes this results in thousands of new unique users, especially if a particular story makes it to the Chronicle’s homepage.

Shapiro said he’s able to keep The Alternative Press front and center by participating in as many local civic groups as he can. He’s currently president of the Rotary Club in Berkeley Heights, on the board of several local chambers of commerce, and also volunteers with several local organizations. All of this requires more time to be added to his already packed schedule, but he says it’s worth it in order to establish the credibility of the site.

“It’s one thing to say you are local; it’s another to be truly local,” Shapiro said. “We don’t just talk the talk, we walk the walk, and our communities know it.”

The importance of social networking on sites such as Facebook and Twitter can’t be overstated, but like anything else, your site’s strategy needs to be mapped out, or you could spend an inordinate amount of time that could be better spent reporting, posting new stories, or selling ads.

West Seattle Blog was an early adopter of local social media and has developed a great relationship among readers on its various accounts. The blog’s Facebook page has nearly 8,000 followers, and Record posts new content all day across the various networks, all with one aim in mind — engagement.

“It’s a place we have to be, because some members of our community are there and expect to get their news there,” Record said.

Advice for hyperlocal start-ups
The hyperlocal news scene has been a tricky model for both legacy media and independent entrepreneurs to succeed and thrive in, but the sites that have remained sustainable point to some clues as to how news start-ups can best set themselves up for long-term success.

Ilfeld at Sacramento Press stressed that for legacy companies interested in investing in hyperlocal journalism, the important decisions they need to make are strategic, not tactical.

“I think it’s crucial for interested companies to have a good strategy defined, good revenue streams set up, and hit it hard to sell these projects,” Ilfeld said. “The biggest failure is a lack of buy-in from either the business side or the editorial side.”

At triCityNews, Jacobson always shunned the Internet, for fear that it would cannibalize his print publication’s business. So when he launched his hyperlocal news site, the Asbury Park Sun, Jacobson kept his goal modest: Simply have the Sun carry its own weight financially. So far, so good.

“I don’t believe the economic benefit of this type of journalism is in conventional profit,” Jacobson said. “I think the main economic benefits come in much different forms.”

Jacobson sees the Sun as a way to boost the reputation of triCityNews, as well as bring in more advertisers. In addition, having an online presence has allowed a new revenue stream to open up at this company.

For Record at West Seattle Blog, the term “hyperlocal website” can mean many things, but in terms of providing online community news, having a journalism background is all but mandatory.

“I can’t imagine being able to do this without everything I learned to do over decades of working with great people — both mentors and colleagues — and I am still learning,” Record said.

Record said the best thing any one company or individual can do that’s interested in starting their own news site is to strive to keep listening and responding to the community’s wants and needs.

“Just keep listening, and you will know what to do. The challenge then becomes finding the time and resources to do it, but that’s a whole other story.”


Rob Tornoe is a cartoonist and columnist for Editor & Publisher and can be reached at robtornoe@gmail.com.          

Comments
Add Comment