The roaring 20s of publishing has begun with several new brands launching, each with their own twist on dealing with the challenges of audience growth and sustainable business models. What’s notable is most publications are not promising to build massive audiences. Instead, most are focused on high-value audiences that lend themselves to high-priced ads and subscriptions.
Grid is one of this crop of newcomers. Laura McGann, a Vox.com editorial director who is running Grid’s editorial side, saw an opportunity to build a news brand premised on a new newsroom model that seeks to tell a more complete picture of news stories through a collaborative approach that taps into different areas of expertise. The end result: a “fuller picture” of the news.
“We're trying to create our brand around the idea that we can create additive value where one plus one equals four by putting really smart people together.,” said Brad Bosserman, Grid’s CRO who joined the company following seven years leading brand partnerships at Politico.
Brad and I discussed the current boom of publishing startups, journalism-led innovation and building a sustainable business model around targeting influential readers.
The new cycle of publishing innovation
My view is we’re at the start of a multiyear cycle of innovation in publishing, as legacy publishers look to consolidation and efficiency while a new class of upstarts spring up to move faster to capture new opportunities that inevitably spring up with the macro environment changes. Brad points out that media is a reactive business.
“Media companies tend to be born in generations. When you look at that 2005-2007 period, you had all sorts of companies that were born in that same window. And now 15 years later, you're seeing another one of those generations where a new breed of companies is being born. A lot of times media companies are downstream of larger changes in the culture, consumer behaviors, business models and technology platforms. As those things change, media companies react to those [changes]..”
The pivot to direct connections
During the last period of publishing innovation, platforms were at the heart of most companies’ distribution plans, at a minimum. The idea was simple: Facebook was connecting the world, might as well hitch a ride to grow alongside a once-in-a-generation company that’s adding millions of users a day. Easier to swim with the tide than against it. These days, you’ll rarely hear mention of platforms in the pitches for new publishers. You’re more likely to hear about how important email newsletters are.
“There's a lot more skepticism around the platforms [and] the idea that you could get a lot of audience quickly from Facebook. There's a big push toward owning audiences in a much more authentic way. That’s at the core of everything that's being launched: the idea is that you really need to own your audience. That's because of all the experiences that folks have had over the last 10-15 years. [Platforms] did allow for a lot of companies to acquire large audiences at various points, but they found that they were renting them. That’s behind a lot of the push toward subscription models and the push to first-party [data].”
New entrants to a market typically lead with a product innovation. In the news publishing business, the product is the journalism. If there’s one lesson to take away from the remarkable turnaround at The New York Times, it is not about the power of paywalls but the power of investing heavily in the core of the product: the journalism. Grid’s co-founder Laura McGann, a veteran of Vox, wants to pioneer a new approach to presenting a fuller picture of stories through collaboration. This is a bit of a contrarian bet at a time when the unbundling of publishing has resulted in many individual operators.
“Laura felt like a lot of the very best, most impactful journalism that she oversaw at Vox was when different reporters who had diverse sets of expertise worked collaboratively on stories so that they could leverage different perspectives. Those were things that really broke through and created differentiated value. She was looking to create a newsroom where that is the animating idea. You can have a science expert sitting alongside a public health expert, sitting alongside a politics expert, and a data expert who can all work together on a story and bring that to life for our audience.”
Boom times for “high value news consumers”
If you have a fair amount of money and power, do not worry about new options for understanding the world around you. Just about every news startup is, in some form or fashion, targeting influential audiences. Like its peers, Grid is built for what Brad calls “high-value consumers” that consume a lot of news. These are not people without access to credible, quality information.
“The Grid audience is anybody who seeks to understand the news in a more meaningful and complete way. We believe there are tens of millions of people who fit that category. We're responding in particular to a need of high-value news consumers, people who are already reading 4-6-plus new sources regularly. They're trying to make sense of all of those headlines. They tend to be professionals.They tend to be folks who value high-quality information because they need that information oftentimes to do their jobs. If their job involves making decisions, it's predicated on understanding issues with the level of depth and sophistication.”
Like every industry, the media business tends to follow the money. One of the worst bets of the last era of publishing innovation was that ad dollars moving online would go to publishers. Nope, mostly went to Google, Facebook and other platforms with massive data advantages for ad targeting. But that’s a broad brush; several categories have thrived, including brand reputation and political advocacy. It’s not an accident that so many new publishers have sprung up from Washington DC, which is awash in corporate influence money. These kinds of campaigns, often geared to a narrow set of influential people, isn’t a natural fit for platforms, particularly since the platforms themselves are some of the biggest spenders to buff up their image and head off draconian regulations.
“We've seen a big change over the last five-plus years where brands have had to articulate themselves and their values, particularly to policymakers, regulators, executives, investors, etc. Folks who are interested in bolstering their brand in that way is a natural market for us. There's also advocacy advertising. We are based in Washington, we have an audience that over-indexes against policymakers and decisionmakers in the federal, local and state governments. There's going to be folks who want to reach those individuals, who want to talk about issues that are meaningful for them. The pie keeps getting bigger. The fact Is that the government isn't going away, it's not going to become less important to all sorts of parts of our society and economy. The stakes are only increasing.”
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5 things to check out
Politico has turned 15 and has published a fun oral history of its early days. It’s hard to imagine now, but covering Capitol Hill and goings on in Washington was formerly a very staid affair dominated by The Hill and Roll Call. Politico burst onto the scene with a differentiation in metabolism and aggressiveness that changed the sector. It also pointed the way to a powerful media business model with its prosumer approach.
The Web3 backlash is in full swing. With the crypto winter setting in and asset prices plummeting, the doubters are in full swing. YouTube creator Dan Olson went deep, recording over two hours on “the problem with NFTs.” Given the unrelenting hype that’s powered crypto’s rise, it’s only fair that a commensurate amount of doubt, even hate, brings it back to earth. The end result, like in most things, will end somewhere in the middle, neither revolution nor Ponzi scheme.
WorkWeek is a building new models for B2B content creators. The company is squarely in what was described to me as “dental with upside” part of the creator economy by recruiting vertical industry experts to create mini-media businesses under the WorkWeek umbrella and share in the upside. WorkWeek is attempting to replicate the success seen by some prominent newsletter writers in using their content as an entree to investing. WorkWeek has established a $10 million fund that will allow its writers to act like investment scouts by referring deals and enjoying some upside without the need for tons of capital lying around, something most writers don’t have.
Google has responded to the allegations made in the Texas attorney general lawsuit that it is engaged in anticompetitive practices in its ad tech business in the form of price rigging. What I can’t get over is how bizarre it is to have Google running the auctions in the first place instead of an independent company. That’s going to be the issue Google ultimately confronts.
Digital subscriptions are moving into a new phase. The first phase for many news publishers was growth at all costs. That led to an emphasis on acquisition tactics and cut-rate introductory offers. George Montagu, subscriptions lead at FT Strategies, sees a more interesting phase beginning with more focus on, believe it or not, the actual quality and value of the product. You cannot optimize your way to long term success.
Appreciate everyone reading and listening. If you have a chance, please rate the podcast and leave a review on Apple Podcasts. Drop me a note at email@example.com with feedback.