Tomorrow at noonET, we are holding a virtual event in collaboration with Beehiiv to reveal the findings of our latest research project. “The new role of email in modern media strategy” report is based on a survey of 70 media executives on the increasingly key role email is playing as publishing businesses shift to audience-centric strategies built on direct ties. Beehiiv CEO Tyler Denk will join me to discuss the findings, examples of best practices and common pitfalls we uncovered in the report.
Today: A conversion with Outside CEO Robin Thurston about using media as part of a product flywheel; BuzzFeed blame game; the magazine as dinner party; all roads lead to B2B; and Jeff Bezos might not be a media genius after all.
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My overarching media thesis is that it is frequently best as the feature of another business or as a collection of businesses. There will always be a small set of players who can execute a direct-to-consumer strategy, but most in categories like lifestyle will need to find side hustles.
Outside is an example of media as part of a product flywheel. Robin Thurston raised $150 million to execute a rollup of 30 companies to marry (Outside, Backpacker and Ski) with apps and transaction engines (Gaia GPS, MapMyFitness, Entopia). The thesis: move people from inspiration to actually getting outdoors, Robin told me on The Rebooting Show. Outside's media brands are the top of a funnel that feeds mapping apps, travel bookings, SaaS platforms, and events like its Outside Days festival that drew 35,000 attendees and is on its way to being a $10 million business line.
"People want to go do these things and we want to make it easier for them from the point of discovery or inspiration to actually going out and doing that activity."
The role of the media assets in this kind of model is far different from what it is when media is the product. In this kind of model, media is an important feature of a larger ecosystem that is premised on getting a goal accomplished. Outside has now reached profitability, Robin said, with about $125 million in annual revenue, a sharp turnaround from burning $40 million a year in 2021. The business has shifted from 75% advertising to majority subscriptions.
“It was pretty evident 15 years ago that advertising was just getting gobbled up by the large technology players,” Robin said. “We had to get into recurring revenue."
This comes with downsides: Outside magazine has gone through wrenching changes that have angered many of its well-known contributors to the point where they asked for their names to be removed from the masthead. “We had to figure out how this business was going to get self-sustaining,” Robin said. “That was really painful.”
Time’s newsletters reach millions of readers every week. But until recently, they were stuck with clunky workflows, limited insights, and flat engagement. After migrating 13 newsletters and millions of subscribers to beehiiv (with zero downtime) things changed fast. Open rates on “Inside Time” jumped 63.8%. Click through rates across their portfolio increased to 11.7%. Editors now publish faster, with better tools and real-time insights. Time proves that even the most established media brands can evolve and thrive when they own their email strategy.
Who lost BuzzFeed?
From its start, BuzzFeed acted as something of a bellwether of how digital media was being shaped by responsiveness to the incentives of massive audience platforms. The thesis at its core was simple: The internet was a new network that needed native programming, and BuzzFeed would be a programmer. It was compelling enough to attract big investments from Lerer Hippeau, Andreessen Horowitz, NBC Universal, Softbank, Hearst Ventures, General Atlantic and New Enterprise Associates and ultimately a $1.7 billion valuation.
Now it’s warning of “substantial doubt” that it can continue as a “going concern.” It has readied a spinoff company, Branch Office, to produce creative software projects. This sets up a scenario where legacy BuzzFeed is harvested.
It raises a question: Could BuzzFeed have been saved or was it simply a victim of circumstances that overwhelmed its hypothesis?
The blame-Jonah case. This one was voiced, surprisingly, by longtime BuzzFeed backer Kenny Lerer, who bluntly said “They blew it. Jonah had every opportunity to make it work, and he just couldn’t make it happen.” This is the no-crying-in-the-casino VC logic: Environments shift, you have a big audience and loads of money, figure it out.
The systems case. BuzzFeed made a sensible bet, backed by Lerer and others. That bet turned bad due to the tech platform oligopoly. Jonah spent years fruitlessly saying the platforms would pay publishers like BuzzFeed. It never happened. Sure, mistakes got made along the way – being snooty about programmatic for too long, overinvesting in live video, fumbling creators, etc – but look at how its competitive set met similar fates.
As usual, the true answer is some of both. The premises of this class of media businesses turned out wrong. They built infrastructures that weren’t right for how the market developed. And they fell for the sunk-cost fallacy instead of making decisive changes earlier.
The magazine as dinner party
The Oscars aren’t quite what they used to be. Hollywood has gone through a brutal stretch. Its model is under severe compression. Big high-cost movies are losing to TikTok and YouTubers. Conan O’Brien took multiple swipes at how terrible phones are for the movies: They’re not made for little screens, which also distract those who do watch movies.
The Vanity Fair Oscar party was also smaller. Slimming it down, and infuriating status-obsessed Hollywood types, will create scarcity; a party everyone is at isn’t as valuable as a party everyone wants to be. It’s a smart move as new editorial director Mark Guiducci steers the magazine into a new chapter where he’s as much a party planner as editor.
To his credit, Guiducci understands the assignment. “The role of a magazine to convene the worlds that we cover is so important,” he told the Financial Times. “It’s just as much a part of the magazine in my view as our YouTube channel or the print product.”
These are brands. They need to be expressed multiple ways. Events will be a core part of these businesses. Time is about to cross the threshold of being an events company with a magazine. Niche magazines often front activations businesses. More will follow. Putting ads on pages, whether in print or digital, is not a winning strategy.
Everyone wants to be in B2B
Notus is making the smart move of rebranding to The Washington Star. Notus sounds like a productivity app.
The Robert Albritton-owned publication is also using the travails of The Washington Post to expand its remit and attempt to run the playbook The Washington Post should have run, at least according to conventional wisdom. That playbook is centered on going deep in Washington, both political and local coverage, with a business model that leans heavily on corporate affairs budgets with high-priced subscriptions. In effect, it wants to be a B2B publication with a consumer front end. Call it “business-to-professional,” if you must, but it’s B2B.
Even The New York Post is B2B curious. Land on a Hollywood Page Six article, and you’ll have to fill out a form with your work email, job title, company and what guild you belong to. This is all in service of Hollywood’s version of corporate affairs budgets: the still-lucrative for-your-consideration awards seasons promotions. This is a noteworthy shift. The New York Post is a business heavily dependent on the pageviews + programmatic formula.
Media is scrambling to find these kinds of niche pockets in B2B advertising. Both benefit from tech platforms more often being customers than competition.
Jeff Bezos is lost
Needless to say, Jeff Bezos is a smart and accomplished man. And yet by all accounts I’ve read, he doesn’t have a clue about the media business, despite owning The Washington Post for a decade.
The New York Times did a deep dive into his stewardship of The Washington Post. What emerges is a familiar story of an accomplished entrepreneur with a set a playbook honed in tech and logistics who sees media as no different. The fix is using audience data to inform decisionmaking and increase productivity.
Why didn’t anyone think of that, other than nearly every single publication of the scale era that ended up in flames? Gawker had its scoreboard of pageviews, BI had its quotas, BuzzFeed was a master at reverse engineering audience data, etc.
Following the data has proved to be a disastrous strategy in media. It’s how you got publications that tried to be everything to everyone, mostly because the “audience data” used has been produced by algorithmic platforms. The data kept telling publishers to write another Game of Thrones recap. In trying to be everything to everyone, these publications didn’t become essential.
Amazon won because it proved you didn’t have to choose between getting something cheap or fast. You could have both. Media doesn’t work that way. You have to make people feel something, make their lives better, or solve a problem they have.
I’m surprised Bezos hasn’t landed on another totem of his playbook: utility. News has to be useful to people, as Dmitry Shapiro laid out in our recent conversation. The problems at the Post and other news publishers tend to land on what they’re producing not being essential to people’s lives. That’s not an issue to be solved by counting pageviews per story or per reporter.
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