In the SXSW Interactive panel “Booming Media Brands Holding onto Identity,” AdAge reporter Michael Sebastian, Vox Media’s VP of Global Marketing Jonathan Hunt, Refinery29’s EVP of Marketing and Strategy Patrick Yee, and Mashable’s CMO Stacy Martinet discussed how to grow the momentum their sites are currently enjoying, and how to monetize media sites in the ever-changing digital landscape. Here’s the inside scoop into how these media outlets are growing, and some pointers for any potential advertisers looking to tap into their large, tech-savvy audiences.
Will any of these be the next New York Times? By probing into their business models, AdAge’s Michael didn’t hold back, and was able to get to the root of how to make a media brand profitable in an age of depressing CPMs and cheapened subscription models.
You gotta raise money to make money
GigaOM, a tech news site with millions of visitors a month, shut down abruptly last week. Are Mashable, Vox, or Refinery29 in the same trouble? GigaOM was mired in debt. Vox has raised 110 million in venture capital, and rakes in about 55 million in revenue. Refinery29 has raised 30 million and makes about 60 million in revenue. Mashable has raised 14 million, and has about the same revenue as the others, Stacy says.
For the first five years of being online, Mashable was completely self-funded. We’d sell an ad, take the money, and hire an editor, Stacy says. Why did they go ahead and raise series A funding in 2013? The media landscape has become much more competitive, Stacy says. Any one of us can now become publishers. Meanwhile, some of the larger companies are starting to contract. We had to raise funding to invest in areas of the business that could pull us ahead of the pack.
Jonathan, Patrick and Stacy are all optimistic about the ability to use these investments to become profitable. So how will they go about that? The panelists brought up four strategies for generating revenue and staying ahead of their competition:
- Leaning into their readers’ habits, like media consumption;
- Continuing to rely on and evolve native advertising;
- Tapping into the newest tech;
- Holding onto a defined identity by offering some unique value to readers.
Consuming media like never before
Is advertising the answer to turn a profit? Michael asked. Print profit margins are 85% for magazines, but digital CPMs are depressed by programmatic buying, among other reasons.
Patrick talked about how Refinery29 leans into the habits of its readers. Patrick noticed that his readers were consuming twice as much media (!) than they were a year and a half prior. And media consumption is up FOUR times over two and a half years ago.
Michael polled the audience: is it possible to reach peak video? No hands were raised. Bring on more video!
At Mashable, Stacy says they are leaning into short-form video (0:06 Vines, say, or 2:03 videos). They publish interviews, or quick animations that complement a story. Mashable is proud to master these new types of formats, and longer video is incredibly expensive anyway. It’s very important for Mashable to stay ahead of what’s trending, and iterations of short-form video is where it’s at right now.
Journalism and Native ads: it’s complicated
Michael asked the panelists, as a reporter, what does the future hold? Is he destined to retire as a Sponsored Content author? (He didn’t seem too psyched about that!)
At Vox, Jonathan said, the goal of the magazine is to create meaningful content at scale. He transfers this goal to all his marketing efforts, so that he can create authentic content. Advertisers are not trying to take business from journalists. Don’t be afraid of us, he says.
Jonathan’s job is to repurpose content and place it in a marketing ecosystem. He’s trying to get as many eyeballs on the content as a whole as he can, all the while tracking the whole operation. Any native ads created at Vox align with content that the editorial team would be excited about creating themselves.
Patrick related how native ads started at Refinery29. They were running a lot of beautiful features on high-end local stores like Opening Ceremony. Marketing representatives from Ralph Lauren’s Rugby loved these features, and requested one of their own. Rugby being a bigger chain store, this wasn’t something Refinery29 would normally do–but after visiting a store and getting some creative ideas, Refinery29’s native ads offering was born. Had they not loved the store on their visit, or figured Rugby was not a great fit for their site, this wouldn’t have happened.
The native ads strategy at Mashable is to serve the community first. The outlet is very clear with its staff about keeping its journalism genuine, while also ensuring its marketing and sales departments are healthy. If it ever makes sense for Mashable to use its own resources to help between departments, they’re careful, but smart. For example, if they are running an ad on what’s inside the Apple Watch, they have tech editors on hand to supply any info.
Tapping into the newest tech
One way that Mashable makes money is through its Velocity algorithm. The data team has created a tool that crawls through millions of URLs and determines what is most likely to go viral. The Mashable marketing team uses this to populate the site’s social channels. Now they are licensing the tool to agencies.
Pull ahead by holding onto your identity
Stacy reiterated that the panel’s title–holding onto identity–is going to be the real differentiator when staying ahead of the competition. If your voice isn’t adding anything of value–whether journalism or advertisement–then it’s going to fall by the wayside, fast. Everything you build has to align with your identity and the unique angle you are offering the world. What is your voice? What are your brand’s values? How do you distribute it between each channels? These are such important questions to predetermine. Being true to your mission will pull you in front of the pack over time.
Jonathan added that defining the culture of what you are representing is part of this. Culture is everything–and you’ll use this to configure how your content is disseminated, and how things will be consumed.
The time to experiment is now, Stacy added. No one knows where we’ll end up in this fast race. The first to market is usually the winner.