Monday Note | PandoDaily
Frédéric Filloux maps out what he calls the “split between volume-driven and quality-driven digital properties,” a product, he writes, of declining yields on Internet advertising.
According to Filloux, properties like Business Insider, The Huffington Post and the Guardian have “high audience but low yield”; Salon and Slate have “strong reputation, loyal readership… but — as unfair as it sounds — tiny ones.” One notable exception, Filloux writes, is The New York Times, which added significant subscription revenue to its advertising revenue.
Ad agencies will “always seek to blur the distinction between editorial and commercial contents,” one reason he thinks Business Insider’s razor-thin line between edit and advertising in some cases represents a future for Internet publications, though not one he appears to be totally comfortable with.
Business Insider uses its SEO dominance to sneak in “serious stories,” Filloux writes, even if they’re not getting as much traffic as the site’s clickier items. That approach might sound familiar to the founders of the Huffington Post, who Sarah Lacy writes launched the site with differing goals: Ken Lerer wanted to “get a Democrat elected president.” Arianna Huffington “clearly became obsessed with being accepted by the New York media elite.” Eric Hippeau “believed Huffington Post could be a huge independent media business.” Like Lerer, Jonah Peretti wanted to beat Matt Drudge.
While many tech startups fixate on getting to a $1 billion valuation, the Huffington Post crew focused on more attainable goals. When they got to a certain level of traffic or revenues, that became the new minimum. But the maximum wasn’t the end goal; it was something just a bit bigger. “If you get hundreds of millions of visits, that should be your new low point forever,” Lerer says. “If you can get to that on Monday, there is no reason you can’t get to that on Tuesday.”
It’s easy to see how this approach drove the aggressive SEO nature of the site. But while it kept the company on a traffic and growth treadmill traditional media companies may find distasteful, it was a more achievable way to build a company than a company that raises a seed fund and says it’s going to change the world. “It was both humble and ambitious,” Peretti says. “If we knew we could get here, we could figure out how to get one level higher. People would say, ‘I don’t see how this thing will scale to become gigantic,’ and it was like, well, duh, we’ll figure it out when we get there.”
Related: Peretti’s BuzzFeed opens a Los Angeles bureau, intends to “combine viral-ready takes on big entertainment moments with serious reporting that will rival traditional outlets.” (The Hollywood Reporter)