Case study: The Batavian (USA)

Based on interview made January 30 2010 with the publisher Howard Owens. 

Name of the publication

The Batavian

Established (year)

2008

Web address

thebatavian.com

Form of the organization

LLC

Publisher and Editor

Publisher Howard Owens, Editor Billie Owens

Number of staff (paid full-time + freelancers)

2 + 2

Revenue 2010

Not disclosed. Profitable.

Short description of the site or business

It’s an online, web only site, only covering just Genesee county (pop. 60.370) and Batavia  (pop. 5.915). Concentrates primarily on breaking news, news of the moment.

“The purpose of the site is to provide local residents with timely news and information mostly about Genesee County. It is also our mission to ensure that every resident has a chance to contribute to the community by posting news and opinion about events, whether of local interest or national or international importance.

We believe that through civil discussion, communities grow stronger. We encourage all residents to participate, and only ask that each contributor treat others with respect.”

Staff numbers

Who’s creating the content

Content creators, paid full-time

2 (Publisher Howard Owens and Editor Billie Owens)

Content creators, paid freelancers

2 (one correspondent and they are in the process of hiring another part-time writer)

Content creators, unpaid

A little bit of community contributed content but not a lot. They do not share or syndicate our content.

System engineers: (technical maintenance, site design and development staff etc.) paid full-time

Buying service from a local developer.

Business, marketing & sales, other

Howard Owens runs the business side of the site.

How is your time divided between doing business and content?

Howard Owens spends good 75% of hist time is spent in the news side right now. In the beginning, business side required more attention and cold calling:

“I would program in time almost every day for the business side. I try to plan my day: 3 o’clock I am going to make phone calls directly to set up appointments with my advertisers and I would say, I am going to do this either for half hour easily I am going to do this till I have three appointments next week.”

Fall 2010 he got to a point where most of the advertising would sell by people calling him, so his time is more with the writing now. He sets aside a day or two to do advertising once a month. He is getting ready to hire some sort of advertising support person part time.

Normal work day is usually 14-15 hours, minimum 12 hours. Normal day: minimum of 12 hours a day, usually 14-15. Lot of hours in the evening are multitasking in front of the TV. Mr. Owens works on weekends as well.

How they make money

Revenue models and sustainability

Would you say your business model is sustainable?

“We making enough money for me, getting ready to hire some people. I have some sales background, did a couple of sales jobs, so making sales calls wasn’t anything that was intimidating to me. Sales were really just about being a good interviewer, something most journalists should be able to do. Ask what the advertisers need and how to meet them.”

Where does your revenue go?

“About 45% of the revenues it goes into our own pocket, 45% to expenses running the business (we have an office space downtown) and then the remainder is in the bank.”

What about profit?

“Everything we don’t spend on ourselves, its invested back into business.”

What kind of advertising you sell?

Almost 100% of the money comes from ads. Everything is on a contract; most of ads are priced on the month, few are priced on the day. Not based on clicks or actions.

Other revenue sources

Mr. Owens makes “just a little money through freelancing and selling my photographs.”

About selling ads

“You need to go develop an editorial mission and advertising philosophy that backs that editorial mission. The people that are going to support your site are going to do so because – at least initially – they support what you are doing editorially.”

When Mr. Owens took over The Batavian, the company had ad reps but it didn’t work. So he started carrying around media kits, door to door, to almost every business in Genesee county:

“I would just walk in, you know, if they are new. I just walk in and ask if they have heard of the site? They have, great! Talk to them a little bit about it, ask if I am allowed to sit down and say how what we are doing can help promote your business and help get more business for them. And if you want to engage me in a conversation right there, great, we can talk. I may just walk out or I will just give a media kit and say we can talk again a week later. If they are showing any interest at all… a week later or a month later whenever it seems appropriate, we have a conversation.”

Success begets success: after 60 advertisers on board the ads started selling themselves.

“Now the local businesses are seeing a lot of their fellow local businesses on the site and it creates a perception that this is the place to be. It’s the place where everybody else is, everybody in town is reading this site. Advertisers think ‘my competitors are on there, it must be an okay place because such and such business is advertising on there, so may be I should too.’ It’s just all kind of virtual cycles, that make it easier to sell more ads once you have a lot of ads. This is also a part of the reason that we put all the ads on the home page, we want to send that message we have lot of advertisers.”

Read more: Howard’s Five Rules of Hyperlocal Advertising from his blog.

About starting bootstrapped vs. getting venture capital or funding

When Mr. Owens took over the site, he had money only for three months. He signed 40 advertisers in that time in order to ensure survival. With VC backup or grants Mr. Owens thinks he wouldn’t have worked so hard and would have done less experimenting. For example, he created a Groupon-type deal out of desperation to secure some revenue before he could reach 40 advertisers a month (the number of advertisers needed to make site sustainable):

“This is well before Groupon – we started this thing called ‘deal of the day’ – where advertisers could give, say, few hundred dollars and gift certificates that we sell in half price, that would pay for their ad. I started that kind of out of the desperation. I would get 10 businesses doing ‘deal of the day,’ that’s a $1000 a month, that’s a quarter of the money I figured I needed to survive in that stage.  We might have never reached the point where the ads sell themselves if I hadn’t been forced to be creative in thinking.”

What would be the most important thing on your road to sustainability?

“You would really focus on serving those advertisers who want to reach the same audience that you want to reach.  A common mistake is that a lot of local sites may just use Google ad words or other generic ad networks. We are here to serve the local community.”