Comments on: Sites on the rise: Business models remain elusive

By: Dave Chase

Dave Chase — Sat, 01 Nov 2008 07:21:28 +0000

I attended Jeff Jarvis’ “New Business Models for News” event last week. There is a terrific array of innovation and experimentation going on with the production side of the house. Unfortunately, that isn’t matched by the revenue side of the house. This is THE problem with “business models remaining elusive”. We need as much energy in that direction as the production side.

My observation is that local sites have done a miserable job of quantifying and explaining the value of their audience to the advertisers in their community. They also haven’t listened to what their local businesses are saying. After buying http://www.sunvalleyonline.com, I made myself sales guy. I heard loud and clear they wanted more than a simple media purveyor. They wanted a online marketing partner.

There are many implications of viewing ourselves as their “online marketing partner”. For example, we have commissioned research to understand the value in dollars & cents to specific advertiser categories. This allows us to charge premium CPMs ($35-40) as we know we have a quality audience that is worth it. We have also implemented low cost sales models “stolen” from Dell (one of our team members ran Dell’s inside sales org in the late 90′s). These things have enabled us to get
profitable and hopefully more so as we scale this approach. [Our first focus is on http://SunValleyOnline.com and http://www.newwest.net that some know was founded by Jonathan Weber]

While I’d love to have the largess of foundations, I think depending on that just delays the discipline of making it economically viable. I don’t see the foundation approach scaling beyond a limited number of well-connected people. The goal of NextNewsNet is to scale what we’ve learned to other news operations in an economically sustainable manner.

Fyi, my background was being part of the founding team of Microsoft’s Sidewalk project (much of what we’re doing is dramatically different from what we did there). My last job before leaving Microsoft was driving Microsoft’s involvement in the IAB and identifying and addressing the obstacles to getting the P&G’s and Cokes of the world to spend online. We did that and the rest is history in terms of revenue growth for online with national advertisers. Research was one of the key things that addressed the obstacles. We think we’ve ID’ed the obstacles locally. Stay tuned…

By: David Westphal

David Westphal — Fri, 31 Oct 2008 18:18:29 +0000

Terrific post, Dave. I plan to write more about this very topic next week. As you say, there’s a robust line of thinking that local sites (with or without current foundation support) won’t sustain themselves without a stronger understanding of how the digital world can work to the advantage of retailers and other small businesses.

By: David Westphal

David Westphal — Wed, 29 Oct 2008 19:57:04 +0000

Dan Weisman of 92067freepress.com sent me this e-mail:

We at http://www.92067FREEPRESS.com have devised a boutique approach to this online community journalism question. We’ve been working on this for about six months, the last few months more intensively and now are ratcheting up our presence. Our ultimate grass roots perspective with an intelligent spin differentiates us from all the sites you have listed in your article; sites I am intimately acquainted with after constant study. Our approach is more of a new path whereas the other independents — guess you’ll get to New West, Pittsburgh Dish, some of the others later, I like New Haven Independent from your list — still try to bridge a print journalism translated to online environment mentality.

Dan Weisman
92067 Rancho Santa Fe Free Press

By: Mary Morgan

Mary Morgan — Tue, 28 Oct 2008 10:40:39 +0000

This is a great roundup, and I look forward to reading the upcoming posts in this series. It

By: David Westphal

David Westphal — Tue, 28 Oct 2008 07:56:05 +0000

Here’s an interesting high school sports site in Georgia:

I read your most recent article with interest since i am one of those former newspaper hacks now trying to break into the local market with
an online startup.

Along with another former newspaper guy, Josh Kendall, I have formed OurVarsity.com, an online community for high school athletes/students/parents in Gwinnett County, Georgia (18 high schools, one million overall population). I was at the AJC covering
the University of Georgia for three years before I had the wild idea to branch off and do this. Josh covered UGA for the Macon Telegraph.

Our idea has been to reach into the high school market by building an online community that not only provides news but allows the students
to be involved. A visitor to our site can look through the more than 10,000 photos, videos and stories we have posted. The visitor can also register, set up a personal page and have every piece of media (video, photo or story) involving him or her and published on the site sent directly to that page.

Users can also upload video/photos to their page and to the site. We spent about a year in development and launched Aug. 15, 2008. In
the first six weeks we have averaged about 18,000 unique visitors per month and have 1,200 registered users/contributors to the site. The
average visitor spends more than six minutes on the site. And we average 350,000 page views a month. We have a staff of two, Josh and myself, and hire stringers from UGA and Georgia Tech to help us with the coverage.

To get up and running it took us about $180,000 and we have a yearly budget of $240,000.
Right now we are in the process of trying to secure local advertising. We have a national company that places sports-related ads onto our
site but the income received is nominal.

Thanks for the article it was very informative. If you have any questions about OurVarsity let me know and I will see if I can give
you some answers.

Carter Strickland
OurVarsity
carter@ourvarsity.com