HyperLocal News Site Case Study

Nov 20, 2014 by Mark Maier

We have mentioned several times that Luce Performance Group consults the highest dollar per capita website in North America, Castanet.net and Thetango.net in Kelowna, British Columbia.  For a market of 150,000 they do very will with revenues over $3 million dollars plus and the unique visitor count is massive. It has taken several years to get there and recently a site in Berekely, California made news with thier event "Uncharted" which was a ideas festival and it is a success story...

" Berkeleyside founders Tracey Taylor and Frances Dinkelspiel told me that they, along with cofounder and editor-in-chief Lance Knobel, discovered an appetite in the community for such an event, and thought it might become a viable source of revenue. October’s Uncharted was the second such festival put on by Berkeleyside; the roster of speakers included authors, academics, journalists, executives, and more.

Another thing that you, as a theoretical resident of Berkeley, California, might have been doing that weekend was sharing your experiences at Uncharted with like-minded souls on a subreddit called BerkeleysNide, a forum “where it’s OK to be snide about the news in Berkeley!”

As is probably made clear by the name, redditors on BerkleysNide enjoy attacking and speculating about Berkeleyside almost as much as they love aggregating and sharing news links about their town. A new post goes up on BerkeleysNide practically every day. In the course of the discussion about Uncharted, commenters discussed theories about the site’s funding model (“Berkeleyside/Uncharted is significantly funded by a very limited and demographically (& ideologically) uniform pool of ‘angel’ patrons”), its founders’ agenda (“an attempt by Lance Knobel to position himself with respect to certain sources of subsidy”), its niche (“I need to spend less time on Berkeleyside, which just absorbs some of the vacuum created by an absence of real civic life here”) and more.

 

 

Berkeleyside’s leaders don’t mind the shade. “We’re important enough that five people hate us,” says Dinkelspiel, who is often called out by first name on the subreddit. Indeed, the staff of Berkeleyside take great satisfaction from their hyper-engaged audience, who regularly leave dozens or hundreds of comments on stories about things like soda taxes (passed yesterday) and traffic patterns. “It’s very much a part of the fabric of the site,” says Taylor.

 

Berkeleyside sees around 160,000 unique visitors a month — impressive, considering there are only around 116,000 people living in Berkeley. The site has a staff of five, including the three founders (some of whom have second jobs), plus reporter Emilie Raguso and advertising director Wendy Cohen. In addition, Berkeleyside employs a rotating cast of around a dozen freelancers who help support their coverage of food, local artists, municipal policy, politics, and culture. Revenue for 2013 was around $218,000, and the team is projecting revenues for this year at around $350,000 — no small feat for a small team covering a small city.

One thing that’s helped Berkeleyside grow its audience is strategic partnerships with other organizations, including KQED and The San Francisco Chronicle. In exchange for helping regional newsrooms fill coverage gaps they can no longer afford to report on themselves, Berkeleyside grows its impact. With KQED, for example, staffers get a chance to go on air and promote the site.

 

 

“With the Chron, they give us tiny amounts of money based on traffic — pageviews that they get as the result of publishing our stories — but where the advantage really is for us is if they put our stories on their homepage,” says Taylor. “It’s a really nice firehose of readers that helps us keep our numbers up.”

 

According to Dinkelspiel, who once worked for the San Jose Mercury News, rather than breed a sense of competition in the Bay Area news market, symbiotic relationships like these create a cooperative atmosphere in which what matters is making sure stories get covered. “The Mercury and the Chronicle used to have 1,000 reporters combined,” she says. “Now they have fewer than 300 together. You can see it in the lack of news coverage. I think both papers make a valiant effort to cover things, but the bread and butter stuff people used to rely on them for is not happening.”

About six months after launching Berkeleyside in 2009, the founders decided they needed someone to take over ad sales. They felt hiring a professional would both be more ethical and more efficient. Wendy Cohen had no experience in digital when she came on board, but she had worked at Condé Nast and was interested in the project. Many local news entrepreneurs come to realize in starting a media business just how difficult and time-consuming sales can be, but finding the right person — or the funds to pay them — is rarely easy.

“She brought a huge amount of expertise in building brand awareness,” says Dinkelspiel. “It’s not just a job to her. It’s building this thing — what are we going to do with this thing that is Berkeleyside?”

Today, Dinkelspiel and Taylor say Berkeleyside is nearly sold out of online inventory. As ever with local news, having a geographically and demographically definable audience helps: Berkeley companies want to advertise to Berkeley residents who, conveniently, tend to be wealthy, educated, and a bit older. Delineated content verticals, especially around lifestyle issues, are also an easy sell; for example The Nosh, Berkeleyside’s food and dining vertical, counts Whole Foods among many others as an advertiser.

The site has also experimented with sponsored content, like a cooking tips video blog sponsored by a local restaurant company and a real estate data analysis package sponsored by a realtor.

 

But lately, as the Uncharted event suggests, Berkeleyside has been pushing beyond merely advertising as a revenue strategy. “Wendy was the one who said, You need to get out there in the community,” says Dinkelspiel. They started by organizing local business forums and ratcheted up from there. In 2012, they held an event with local speakers called “Three Michaels,”featuring Berkeley residentsChabon, Lewis, and Pollan. Uncharted had an impressive array of sponsors. Knobel, one of the founders, works in events planning professionally outside of Berkeleyside and has run programming at major global conferences including Davos and The New York Forum. His expertise helped Berkeleyside cash in on the events trend in media quickly.

 

“We’re not inventing the wheel, but we think we’ve got the in-house expertise and the community that really wants that sort of thing,” says Taylor.

 

 

Being responsive to and involved in that community — BerkeleysNide and all — is important to the site’s sustainability. Their third revenue arm for Berkeleyside after advertising and events is a relatively new membership program where, in exchange for small donations, readers get perks like free event tickets and access to parties.

 

“We feel like, membership, we could go very far with that. We don’t do a good job asking members to donate,” says Dinkelspiel.

If Berkeleyside wants to pay for a site redesign (which would cost “several thousands of dollars”) or expand their coverage area (a considerable undertaking) or pay themselves a living wage (which they haven’t done yet), the next step is to see is whether they can convert lower-tier forms of engagement, like comments and event attendance, into the dollars that they need.

“There’s no formula, that’s a sure thing,” says Dinkelspiel. “We’re a very successful site in many ways, but we’re still not there yet.”

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