Where are the Web Riches?
By Al Diamon
Created Nov 1 2007 - 12:21pm
Posted November 1, 2007
Lots of hits on the Web don't translate into lots of money in the wallet.
That's one thing Maine's largest and smallest Internet news sites have in common. More people may be getting their daily doses of information on line, but advertisers aren't yet convinced they should invest heavily to reach them. This seems to be true not only at Web sites run by daily and weekly newspapers, but also for news outlets based primarily on line.
At Village Soup - which began as an Internet-only news outlet serving the midcoast, before expanding into print editions - only about 20 percent of revenues come from advertising on the Web site, according to Richard Anderson, president and co-founder. But Anderson considers that figure to be reasonably healthy. "Dailies are getting 1 to 2 percent of their revenues on line," he said. "We're far ahead of them, but we still have a ways to go."
The Bollard, a Portland news and entertainment site, has been operating for two years on the Web, but began a quarterly print edition earlier this year and will soon go monthly. Even with only four issues a year, the pulp-and-ink version quickly became the operation's profit center. "We haven't seen anything like the revenues we make from print from our on-line edition," said editor and publisher Chris Busby. "Print revenues are three times as much."
Busby said ad revenues from the Web site cover the cost of free-lance articles he runs on line and some other expenses, but, "It isn't paying for anything above and beyond that."
The Daily Bulldog in Farmington doesn't break down revenues from its on-line and monthly print editions, since advertising for both is sold as a package. Editor and co-owner Bobbie Hanstein said it was "difficult to say" if the Web site turned a profit on its own, but she did say there was always a big surge in the number of hits on the site right after the print version hits the stands.
At As Maine Goes (AMG), the conservative Web site that has become as essential news source for the state's political junkies, activity is up. Owner and editor Scott Fish said AMG now gets a half-million page views per month. And income is up, as candidates gear up for the 2008 elections. Republican U.S. Sen. Susan Collins recently signed a contract to advertise through next June's primary, and GOP congressional hopefuls Dean Scontras and Charlie Summers both have banners. Despite that boost, Fish said, "My goal is to have AMG become self-sustaining. It's not now."
All of which sounds a lot like what the mainstream dailies have been saying.
"Our Web site will make some money," Robert Stairs, vice president and treasurer of the Bangor Daily News told me in July, "but I don't know if it will make lots of money. Time will tell."
"Readership on [daily newspaper] Web sites is through the roof," said Phil Lucey, advertising manager for the New England Newspaper Association, "But there's certainly not the same revenue opportunity on the Web as there is in print."
There are plenty of theories about why that is.
Anderson of Village Soup said the problem is the old media are based on the same advertising scheme as a 19th century medicine show, and many Web sites are simply trying to replicate that model. "With newspapers and magazines, you're producing performances," he said. "You get talent. You get people to come and watch that talent. You get advertisers to display billboards to the gathered audience."
Anderson's new model is the trade show. The performance is still there, but it's mixed in with coffee breaks and cocktail parties, chances to listen to and share opinions with peers. Advertisers are still around in the exhibition hall, but they're also part of the mix, joining in the discussion.
"We're creating a new business category," he said. "We're becoming a community host - not the community news. A community host includes the community news, but it's so much more."
Busby of The Bollard thinks part of the problem is that advertisers are unfamiliar with the Web. He said many businesses are unaware of how simple it is to track the number of hits they get on their own Web sites from an ad on his site. "The Portland market is not as comfortable advertising on line as in print," he said. "They're not tech-savvy enough to see what they're getting."
Fish of AMG said the state's population may be too small to support many Web-based news sites. "There's a very limited audience in Maine," he said. "And a lot of people don't have great access to the Internet."
The population isn't the only thing that's small. One advertising expert, who requested anonymity, estimated that only about 5 to 8 percent of the Portland market's advertising revenue goes to the Web, and most of that is spent on Google and Yahoo, with sites run by TV stations getting the second-largest slice.
Anything more exotic than that is a hard sell, according to Jonathan Hutter, senior vice president for account planning and media at Garrand & Co. in Portland. "We try to convince them they should do more of it," Hutter said. "I think it's just mistrust of a new medium."
Midge Vreeland, co-owner of Vreeland Marketing & Design in Yarmouth, agreed. "There's definitely not the kind of activity we've seen in other markets," she said. "I see it as having evolved further in other markets."
To survive, Busby said The Bollard will have to adapt to that reality. "Our plan is to build up the print readership and bring it back to the Web," he said. "We're doing it in reverse of the dailies."
The usual disclosures: I'm a regular contributor to both the print and on-line versions of the Daily Bulldog. I also once worked for Chris Busby at Casco Bay Weekly.
Al Diamon can be e-mailed at firstname.lastname@example.org.