From portals to two-pizza news sites
Reprinted with permission from the author.
David Carr’s must-read column in the New York Times talks to the phenomenon of acquisition-assimilation: when independent news sites lose their voice and attitude once acquired by big portal aggregators such as Yahoo or AOL.
If issues of spirit and emotion are set aside, and the founders are forgiven for taking the money and running, the big shift is not so much from big brother bureaucracies snuffing out entrepreneurial energy (as Carr says: news sites that can feed the entire masthead with two pizzas have that fire and attitude) as it is about changes in how online advertising is sold.
“….as news surges on the Web, giant ocean liners like AOL and Yahoo are being outmaneuvered by the speedboats zipping around them, relatively small sites that have passionate audiences and sharply focused information.”
Carr posits that audiences could give a hoot whether their preferred content is housed by Gawker or AOL or even independents like GigaOm. That audience has splintered and creates its own bespoken news experience from whatever sites match their tastes, philosophy and particular needs. No one sees a 20th Century Fox Movie, they buy a ticket to see Gwenyth get the flu. I read Dan Lyons, not Newsweek. I read Om Malik, not GigaOm.
The reason little independents can steal the most precious, un-scalable commodity of all from the big guys – a reader’s time and attention – and survive to buy more pizza isn’t the miracle of search, the push of RSS or the lack of prudish copyeditors who ban them from dropping F-bombs. It’s how they get the ad bucks to buy those pizzas.
In the 1990s, online ad sales came down to the old world of print ad sales people showing up at an agency to pitch a magazine’s website to a junior buyer. Few Madison Avenue agencies had any digital experience — some, like Agency.com and Modem Media, were blazing the first trails — and few sites (which mostly were digital versions of existing print titles, e.g. Forbes.com, HotWired, WSJ.com) had dedicated digital ad sales teams.
Selling online ads was a wild exercise in selling a vision (“It’s called the Internet and it’s going to be big, big I tell you!”) and making up metrics. There were no ad networks, the portals were just getting their acts together, and the technology for serving up the ads and then measuring their performance was crude and in many cases hand-crafted and unique to each site. The process was inefficient, often involving lugging big projectors into meetings and talking about impressions and hits in the context of the Audit Bureau of Circulation.
Thin and crude metrics
Those were the days when online publishers could sell the excitement of the future directly to advertisers, cut out the agencies, and get away with reporting thin and crude metrics. Targeting, let alone behavioral targeting, was an exercise in giving an advertiser nebulous advantages like “category exclusivity” or “roadblocks.”
Yet by 2000, few if any titles could sell direct to brands, agencies were fighting to be the arbiter of the ad buy, and the big portal “frames,” as Carr calls them, were the forces to be reckoned with. No sales force was more arrogant in 1999 than AOL’s.
The evolution of ad sales, ad serving, metrics, and the eventual rise of ad networks, behavioral targeting, paid search auction bid interfaces, cookie pools, retargeting, look-alike modeling … all combined to the point where a feisty voice could start blogging and open up his or her site’s inventory with a simple AdSense account or membership in an ad network.
The brands looking for ways to spend their advertising budgets don’t want to take a meeting with the publisher of some tiny-traffic site; they want to get in front of a specific psychographic profile and want to do it with as little fee and friction as possible. Few advertisers have the internal expertise to buy advertising efficiently and directly, but the gap between the upstart voices and the advertiser’s budget is narrowing, killing off the big collector brands. Google got it right when they made the ad buy a simple exercise in bidding.
Carr ends with this great quote:
“Jonathan Glick of Sulia, a site that filters and publishes real-time content, said that, apart from cashing out the owners and sentencing those that remain to more meetings, getting acquired fails to meet a fundamental need. ‘On the Web, traffic, good traffic, is earned in terms of referrals,’ he said. ‘You don’t need to be part of a big site because if you are doing it right on the Web, distribution finds you.’ ”
As quality content will always find its fans, ad dollars will always find quality content.