Adam Westbrook // ideas on digital storytelling and publishing

Revenue streams for your news business: part 1

Posted in Entrepreneurial Journalism by Adam Westbrook on March 21, 2011

 

Image credit: JelleS on Flickr

A two-parter this week: I’ll be explaining 10 revenue streams journalists can use: five today, and five on Thursday.

OK so you might have a brilliant idea for a new news business. You have the collaborators. You’ve got the website. You’ve got the content…

…but you’ve got to make it pay right?

There’s less than two weeks for students in the UK to enter myNewsBiz, the journalism enterprise competition. One of the questions entrants have to answer on their entry form is explaining how their business might make money: where will the revenue come from? To help in that endeavour, I’ve assembled these 10 possible ways to bring in cash.

They are just ideas, and the most successful businesses pick’n’mix from these plus several others. If there are any glaring omissions, let me know in the comments box!

10 ideas for revenue streams for your news business (part 1)

.01 mailing list

It’s an oft quoted maxim among online content creators that “the money’s in the mailing list“. Never mind creating a sharp looking online magazine – if your content isn’t flying straight into peoples’ inboxes then it has a far weaker chance of being viewed. Building a mailing lists means you have a clearly defined group of people interested in your journalism – and therefore they’re more likely to open the email.

Once you’ve built your mailing list up with great content you can look for sponsorship from organisations who’ll appreciate their advert going to inboxes and not just online. They then get a banner at the top of your newsletter.

I’ve mentioned TheBusinessDesk on here before: a daily newsletter of business news to their readers is one of the core things they create. There are plenty of services, like MailChimp who manage lists for you.

.02 other businesses

Here’s another maxim to learn from the business-heads out there: “the best customers are other businesses“. Why? Well, you can charge businesses more than you can charge an individual for something; but also businesses tend to be easier to deal with, and you’re less likely to get complaints.

So how do news businesses find revenue streams from other businesses? Well, there are several ways which pop to mind:

B2B journalism: Business-to-Business publications have mostly done OK during the recession. Their secret is they provide really good journalism to specific industries: their readers aren’t passing individuals, but (often) big corporations with lots of money to spend – who need the information you provide.

Another option is to act as an agency: in this line think of Getty, Demotix and of course, the news wires. Again, they’re building long term relationships with news organisations and charging thousands, not mere pounds.

If you still fancy creating a popular magazine, then there are ways to capture business revenue too. Treat it as a ‘shop-window‘ for a service business. For example, if you love web design as well as journalism, you can run a web-design business off the back of the magazine, with the mag’s awesome design bringing you attention and clients.

.03 partnerships

On a similar theme, another source of revenue could be the ‘partnership’. Here you are collaborating with a whole range of organisations on a specific project, and it’s very suited to the service business model.

We’re already seeing multimedia producers like VII Photography and MediaStorm talk about partnerships with organisations, either as a funder or a publishing partner. Here’s Stephen Mayes of VII, describing the idea in the British Journal of Photography in 2010:

“Certainly the magazines are still in the mix, but now more as print distribution partners rather than as exclusive clients (with additional distribution through TV and online partners), often co-funded by another party and supported separately by technology partners with access to story-knowledge being supplied by yet other people…The line-up shifts for each project, and as each new partner comes on board the opportunities to do interesting work and to generate income multiply.”

I guess it’s not hugely different to ‘clients’ but instead of finding one ‘client’ to pay you to do some journalism, you’re designing a project and getting involvement & funding from several organisations. This means you’re more driven by the project and not who’s paying for it.

.04 affiliates

Martin Lewis: MoneySavingExpert.com

Affiliation is where we get a bit close to the sales/infomercial area of business I think many of us would prefer to avoid. Still, there’s big (and relatively easy) money to be made in affiliates so don’t write it off.

How does it work? Well, you push your readers to someone else’s products, and take a share of every sale made. It has potential in a niche market, because if you can build up a significant, loyal fan-base around a specific area, related businesses will want their product in front of those people. Affiliate deals can nab you between 10-30% of every sale.

Sounds a bit dodgy. Can it be done in journalism? Martin Lewis, founder of MoneySavingExpert.com reckons so: his hugely popular website is funded almost totally by affiliate arrangements. But he is very transparent about when a product is affiliated, and separates it from the editorial content: crucially, he can still criticise a company even if they’re an affiliate.

.05 subscriptions

This revenue stream is very dependent on the type of news product you’re out to create, but in the right circumstances you can get people to pay to read your content. Here’s a must-read articles on how media outlets are using subscriptions.

As newspapers are learning, the key is to avoid ‘news’ content – that’s a commodity now, and very few people will pay for it. But even if you’re writing for a very specific niche, you have to work hard to create something people will fork out for. Targeting the B2B market will give you a better shot.

Is it worth it with hardly any readers? Well, do the maths: if you create really good content for a specific audience, of say, 5,000 readers, that is so good, they’ll be happy paying £5 a month to access it – that’s £300,000 in the bank. A legacy news organisation can’t sustain that, but that’s enough cash to pay yourself and a few others a decent salary. This is where being small is important.

On Thursday: five more revenue streams – plus the most valuable one of all.

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6×6: business

Posted in 6x6 series, Journalism by Adam Westbrook on August 24, 2009

6x6 advice for multimedia journalists

The fourth in a series of 6 blogs, each with 6 tips for the next generation of freelance multimedia journalists.

business

While the news industry is still in an uncertain and uncomfortable state of flux, one certainty has already emerged: journalists can no-longer just be journalists – they must be entrepreneurs too. It’s the difference between the ‘passive’ freelancer who writes to a few editors and waits for the work to come to them, and the ‘active’ freelancer who run themselves as a mini-business.

Until J-schools start adding business skills to the curriculum this will be something we’re all going to have to teach ourselves.

01. diversify

If you went into journalism to become a TV news reporter, and just a TV news reporter, the sad news is those days are over. As are the days of being paid to stay in nice hotels in foreign lands drinking cocktails.

In order to maximise your income, you will need to diversify your skills base. That means selling a range of skills and service, and not just journalism related ones. I know radio journalists who have a nice sideline designing websites, video journalists who run training courses, and photojournalists who work for non-profits.

Training can often be the most lucrative of these – but only consider this if you really know what you’re doing!

Diversify too in your client base. Pity the news-snob who just pitches to the New York Times and The Guardian! The digital revolution means there are more online-only news outfits, but they can be easier to pitch to.

Freelance science journalist Angela Saini offered me this advice recently: “I think it’s almost impossible to survive right now unless you freelance in more than one medium – so as well as doing VJ work, you may have to do radio and print too.”

If you’re a radio journalist you won’t survive as a just a radio journalist. Pitch for video, online, print…everything! Profiling multimedia journalist Jason Motlagh, David Westphal notes:

Motlagh doesn’t just write stories. He shoots still photos. He shoots and edits video. He does audio. He blogs. He narrates slide shows. And because he does all of those things, he says, he has a huge advantage over free-lance foreign correspondents working in a single medium.

Having multiple media skills is “still unusual,” he said. “There aren’t a whole lot of people yet who have gotten up to speed. If you are, you can make clients an offer they can’t refuse.”

02. find new markets

The entrepreneur, although a business profession, requires a lot of creativity. Just ask Richard Branson. From what I’ve gauged you have to be constantly brainstorming new markets and potential clients. And thinking outside the box reaps rewards.

Career evangelist and author of the popular new book Career Renegade: How to Make a Great Living Doing What You Love Jonathan Fields explores how to sidestep traditional career paths to forge your own unique way. He talks about “moving beyond the mainstream” and finding new markets in 6 different places:

  1. finding a hungrier market
  2. finding the most lucrative micro-markets
  3. exploiting gaps in information
  4. exploiting gaps in education
  5. exploiting gaps in gear or merchandise
  6. exploiting gaps in community

The first two are about digging deeper into the industry and possibly connecting two unrelated ones. A great example comes from a friend of mine, film maker Oliver Harrison. He loves cooking, and loves making films but couldn’t find a way to make any money out of either. After a lot of searching, he and business partner Simon Horniblow started talking to universities – and combined the two. They now run studentcooking.tv a very successful online cookery website for students. Would you think to do that? Think outside the box!

To Jonathan Fields:

“In thinking about potential alternative markets, or trying to find smaller, more lucrative submarkets, think about fields, careers, jobs, or paths where the elements of what you love to do are valued, but in short supply. You are looking for a market where your passion leads to: differentiation, hunger [and] price availability.”

Be practical and realistic though: is there really a demand for your new idea?

Here’s 3 examples of journalists who digged a bit deeper to find new markets:

Weyo found a new market in non-profits looking for quality storytelling

Weyo found a new market in non-profits looking for quality storytelling

Journalist Martin Lewis exploited a gap in the market for impartial financial advice

Journalist Martin Lewis exploited a gap in the market for impartial financial advice

Duckrabbit ex[ploited a gap in education and produce training courses in photography and audio design

Duckrabbit exploited a gap in education and produce training courses in photography and audio design

03. bootstrapping

Bootstrapping means starting your freelance business with little or no cash. It means learning how to get things done for free – and most valuable of all – learning to be careful with money.

The great news is you don’t need any money to start out and market yourself. A website domain name will cost you a small amount. But social media means you can market your talents absolutely free (see the previous 6×6 on branding).

Josh Quittner, writing in Time Magazine uses the term LILO – to mean ‘a little in, a lot out’: “At no other time in recent history has it been easier or cheaper to start a new kind of company. Possibly a very profitable company” he says. “[bootstrapping] means your start-up is self-sustaining and can eke out enough profit to keep you alive on instant noodles while your business gains traction.”

If this recession has taught us anything, it’s that the best business is built from the bottom up, on the funds available (not borrowed).

04. dealing with inflexible income

The biggest fear of starting a freelance career is money. Oh, and failure. ‘What if I don’t get any business?’ ‘How will I be sure I’ll always pay the rent?’ Truth is you won’t ever be sure, but that’s part of the thrill, right?

Still there are some things you can do to make the ebb and flow of freelance income a little more stable.

A good tip is to open up a separate bank account for your business earnings. Get Rich Slowly offers this advice: “Every month as you earn income, receive it (and leave it) in your business account. This is where you accumulate your cash. Because it’s in a high-yield account, it earns interest as it waits for you to use it.”

They recommend paying yourself a monthly salary from that business accountand leaving the rest for tax and other investments. The worst thing is to use the profits from a bumper month to pay for a bumper holiday, only to return to slim pickings.

But the best advice for living on an irregular income? Learn to live lite. Cut back on unnecessary spending wherever you can. Back to David Westphal profiling Jason Motlagh: “He lives modestly and accepts that there may be periods in his work where he’ll have to do something besides journalism to pay the bills.”

05. find your creative time

Sure, for some freelancers the appeal of being your own boss is getting up at 10, watching some TV, doing some work, heading out on a night out without the guilt…and that might work for some. But the creative entrepreneur’s life is most likely to be a different one.

Just ask Mark McGuinness. He coaches creative freelancers and says for the successful ones, it ain’t no bohemian life:

After scanning my diary and surveying the tasks in hand, I was faced with a depressing conclusion. I was going to have to get up early.

He’s up at 6 in the morning, every morning, getting the crap out the way, like emails and the like.  He then says he has several hours free to work solidly on creative tasks, before the rest of the world gets up and the phone starts ringing. Know when you are at your creative best and ring fence it, so you can’t get disturbed. It might be 6am, it might be midnight. Whatever, just make sure it’s protected.

…when I look back over the last couple of years, the time when I’ve created most value, for myself and my clients, has been those first hours of the day I’ve spent writing blog posts, essays, seminars and poems. It’s the creative wellspring that feeds into all the coaching, training, presenting and consulting I do when I’m face-to-face with clients.

Treat it like a full time job too. If you can, work somewhere where you can commute to, or have some ringfenced office space at home. I recommend Mark’s excellent (and free) ebook “Time Management for Creative People“.

06. be lean, but don’t be mean

If you’re dreaming of going freelance, you might be thinking about holding off until after the recession. No need, says Leo Babauta 0f Zenhabits fame:

This is the best time to start. This is a time when job security is low, so risks are actually lower. This is a time to be lean, which is the best idea for starting a business. This is the time when others are quitting — so you’ll have more room to succeed.

And with social media and networking taking off, this is the easiest time to start a business, the easiest time to spread the word, the easiest time to distribute information and products and services.

Starting now though won’t be easy – and you’ll need to be lean. But that is such an important skill to keep things afloat later on. Be sensible with your money, don’t overspend. It’s the thing the big companies can’t do, and the reason they lose money hand over fist. And don’t be mean: journalism is a small village – make friends and keep ’em!

The final word:

Journalism.co.uk offer some great practical advice for freelancers, which cover things like registering as self-employed, pitching for new work and managing finances. And if you’re still unsure of taking the entrepreneurial route, just watch this:

Next: audio for multimedia journalist!