Thanks to the 300 of you who have filled out The Rebooting’s first audience survey. If you haven’t yet, please consider doing so as it will help me as I add new features, like an event, and to show to sponsors that The Rebooting has a valuable audience. I’m taking up one suggestion from the survey and adding a TLDR at the top with what’s to come:
- The Dispatch is the second most popular Substack newsletter in the politics category, but not for much longer.
- The bundle is coming back, but in a new form.
- Preliminary results from The Rebooting’s audience survey.
- Why Twitter’s ad model hasn’t worked.
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Why The Dispatch outgrew Substack
Many would assume the most popular political publications on Substack are culture war agitators like Matt Taibbi and Glenn Greenwald. In fact, the top two slots are much milder publications: Letters from an American and The Dispatch. Taibbi and Greenwald will be moving up a slot soon, since The Dispatch is leaving Substack.
Steve Hayes, one of the founders of The Dispatch in 2019, said the conservative news and commentary publication has outgrown the tools that Substack provides. Part of this is ideological – not in the political sense – in that Substack has squarely cast its lot with individual creators, doesn’t believe in advertising, and wants to be a platform rather than a backend tool.
“There was a certain point when they were seeing the success that they were having by focusing on individual content creators, and said, we need to do more of this. And there came a point, when their growth, which was just monumental and what they were doing to get that growth, didn't work for us as much as it had in the past.”
Businesses are all about making choices. And ultimately you can’t please everyone all the time. That said, I think Substack is at risk of losing many of its initial wave of successful publishers, particularly as upfront deals end and the pinch of paying 10% of revenue. (The Dispatch had a “handshake agreement” with Substack and didn’t get a special deal, according to Steve.)
The shift to individuals from institutions has been a major catalyst of publishing’s unbundling, but I believe we’ll see more confederations between individuals, sometimes just a gussied-up regular company and other times in new collectives. That’s because working with others tends to be more enjoyable for most people. What’s more, being part of a group means you can have someone to cover up for your inefficiencies or allow you to take a vacation. There’s still strength in numbers. What’s more, bundles are often better for customers.
Steve and I discussed how The Dispatch plans to expand beyond its 30,000 paying subscribers by adding in advertising and events. We also discussed building a center-right political publication at a time of extremes, and I tried but mostly failed to get him to give an optimistic view of what’s to come in U.S. politics.
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The pendulum in the media business always swings too far, then it corrects. We’re in the midst of a correction phase, accelerated by an economic situation that points to a recession. Some ongoing corrections:
- Recalibrating ads and subscriptions. It turns out that subscriptions aren’t the only media business model. Go figure. Hating on ads is usually followed by adopting ads while saying the ads the publication objected to were simply a different type of ads – programmatic, intrusive, whatever works.
- Recalibrating institutions and individuals. The solo life not only isn’t for everyone, it isn’t for most people. Trying to do it all is exhausting. But even more so, an overarching brand is a useful signal to an audience, and bundles tend to be very good deals. After all, many of us decried the cable bundle only to have five-plus streaming service subscriptions that cost more than cable did and make finding a show infuriatingly complicated.
- Recalibrating nice-to-have and must-have. The problem with rising tides lifting all boats is you don’t get an understanding of who has the sturdiest vessels. Downturns tend to make that obvious by forcing tough choices. As Uber CEO Dara Khosrowshahi told employees this week, the least efficient marketing spending will be pared back. That will happen across the board.
The Rebooting’s audience profile
An important premise of primary-engagement media is quality over quantity. So far, I’ve found sponsoring companies that I’ve worked with to be OK with smaller audience numbers as a tradeoff for a more highly engaged audience. Many publishers have low-engagement audiences, with 80%-plus bounce rates, email open rates of 20% and three quarters of their traffic from fly-by-night visitors gotten from search and social thanks to content arbitrage. There has to be a better way. So far, so good with the audience survey since, thankfully, it’s showing that The Rebooting is attracting an engaged, valuable and targeted audience. Some initial highlights:
- 63% work in publishing
- 30% are founders or CEOs
- 48% are C-level
- 68% make technology buying decisions
- 32% work at companies with over $50 million
- 32% have job responsibilities that include ad sales
- 31% have job responsibilities that include subscriptions/memberships
This is a good time for me to again ask you to take the survey. I’d like to get 500 responses before closing it. If you’re a company that wants to reach The Rebooting’s audience, please check out the sales kit and get in touch. Next week, I’ll share the feedback on expanding The Rebooting and ways to improve.
Why Twitter’s ad business lagged
This is mostly an Elon Musk-free zone. (I also refuse to call the tech CEOs by their first names. I don’t know where that began because it reminds me of Chrissy-Martina era of women’s tennis.) But I did want to comment on one conundrum that’s dogged Twitter for years: For such an influential platform, it has a comparatively small ad business, and a new boss who plans to greatly expand its ad business while disliking advertising and wanting to make Twitter a free-for-all that is not going to sit well with risk-averse advertisers.What went wrong?
- Twitter could never understand its audience data. I spent many years in a strange show-on-ads protocol that Twitter put journalists in. Smart move, because I got taken out of about 18 months ago, and wow, Twitter’s ad quality isn’t great. I kept getting served ads for the FTX F1 music festival in Miami yesterday despite being in New York – and the event’s final performance having already begun. Say what you want about Facebook, it regularly serves very relevant ads. There’s a reason that big retailers have such fast-growing ad businesses.
- Twitter got stuck in the middle. Digital media has, for the most part, failed at brand advertising. For years, this was a lament. But direct marketing got rebranded as “performance marketing” and Google and Facebook showed how audience targeting at massive scale is a money-printing machine. Twitter couldn’t execute on that level, but also couldn’t offer brands the kind of surfaces they need in order to do effective brand advertising.
- Slow product development. Twitter’s core product has not evolved as rapidly as its peers. Part of that has been a weirdly vocal contingent of power users, but part of that has clearly been internal dysfunction. If the core product doesn’t evolve, the advertising product will also stagnate.
Final note: On New York
I’m in the midst of, well, relocating from nearly two years in Miami Beach to New York, my home of 20 years. The strange thing about coming back to a place you know so well is how it’s so familiar yet also a change. I find I have memories attached to places that come to me, something that would never happen when I lived here. As luck would have it, we are living a couple blocks from where I worked for several years. New York is far more intense than Miami – someone at a bagel shop reached over me to hit the “confirm” button when I hesitated at the PoS display – and there is far less sun, or even much at all in the Financial District, but New York is still a unique place. The people focused on the more feral aspects of the moment are being short-sighted. There are far easier and more comfortable places to live. New York isn’t that. New York forces you out of your comfort zone, and that’s how true growth happens. Good to be back, although Miami is still amazing, and anyone claiming otherwise either hasn’t ventured beyond South Beach or is one of those people with “native New Yorker” in their Twitter bio.
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