As newspapers struggle to figure out how to make online news coverage profitable, there have been many independent journalists and bloggers stepping up to fill in the gaps left by newspaper cutbacks. It’s important to help these independent content creators gain new revenue streams, said Missouri School of Journalism Alumnus Matt Sokoloff, of Orlando.
“In my opinion, independent journalists are going to be key components to the way we get our local news,” said Sokoloff.
Sokoloff came to the Donald W. Reynolds Journalism Institute at the Missouri School of Journalism to pursue a one-year fellowship desiring to build an operation that would help local independent publishers generate additional revenue.
His goal is to build a proof of concept online advertising network that will provide unique products for regional marketers while helping the independent and community publishers create a new revenue stream.
“Most independent or hyper-local websites aren’t large enough to attract the attention of regional advertisers. By combining their ad inventory we create a compelling product for regional marketers,” he said.
Sokoloff pointed out that before the Internet, regional advertisers would turn to newspapers and TV and radio stations when they wanted to reach a local audience.
“Today, there aren’t any great full service solutions to help regional advertisers buy digital media,” Sokoloff said.
Sokoloff said he believes the companies that will offer these solutions should be local companies and not large national companies.
“There are lots of national companies that are trying to offer digital solutions to local businesses; the problem is local business end up getting frustrated with these solutions because there is no consistency and it only takes one bad sales rep to ruin it for all of the businesses in the market,” he said.
Sokoloff is working to build a proof-of-concept in Orlando to demonstrate how this would work.
“Once we have a model that we can prove works it’s just a matter of finding out where it fits best. It might be individual companies in different markets, it could fit within existing regional agencies or it might fit best inside a newspaper, TV station or independent hyper-local site that already has a sales force in the market,” Sokoloff said.
Sokoloff graduated from the Missouri School of Journalism in 2007 as part of the first Convergence Journalism sequence class. After graduation he began working for the Orlando Sentinel creating a webcast. Not long after Sokoloff started working in the newsroom the general manager challenged him to determine how much revenue his content was making for the company. When Sokoloff discovered the answer was nothing, it sent him on a path to try to figure out a business model for local news.
Over the next seven years, he worked as a product manager for the Tribune Company’s (the Sentinel’s parent company) eight newspaper websites on various projects, interacting with everyone from editorial to sales and marketing to developers and advertising operations.
Periodically Sokoloff would try to build a profit and loss statement for an online only news operation.
“Every time I’d come back with the same result — it just wasn’t possible to create a site with quality content and make it profitable using just ad revenue,” he said.
Sokoloff said that one of the most glaring issues is that ad rates online were too low and only getting lower. Sokoloff believes that part of the problem was that brands didn’t value an online ad in the same way they valued a newspaper or TV ad. Sokoloff began working as a product manager for a start-up company called Korrelate building and marketing products focused on connecting online advertising to offline purchases in an attempt to show real ROI to brand advertisers.
“I learned a tremendous amount of what it takes to create effective advertising to keep clients and customers happy from an online advertising perspective,” he said.
Sokoloff wondered if he could combine all of his knowledge and experience and create a profitable news-based venture. He realized there were many content creators across the country already operating small news websites but struggled to build a sustainable revenue model.
“These people love creating content but they don’t necessarily have a sales or online advertising background,” he said. “These starters are creating news websites to write and create content, not to sell ads.”
Sokoloff switched his focus in hopes of coming up with ideas to help these independent publishers and bloggers generate additional revenue.
With marrying the local marketer’s problem of not having a local digital advertising solution and the hyperlocal publisher’s problem of not wanting to sell ads and by adding in some existing sophisticated ad technology and data, Sokoloff hopes to build a profitable way to buy and sell ads in the local marketplace.