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Aug. 28, 2018, 11:10 a.m.
Business Models

Billy Penn, Denverite, and The Incline are all going after members. Can they become predominantly reader-supported?

The three sites together are “just south of 1,500 paying customers,” 60 percent of whom are signed up as recurring contributors (of these, the average annual contribution is around $115 or $120). Denverite, which launched its program first, has around 900 members.

It’s a member, it’s a contributor, it’s a customer — no, it’s that saintly reader whose main interest is supporting these local news sites and keeping the journalism free to read for others who can’t afford it.

Last fall, Spirited Media was laying off staff at each of its three publications. Earlier this year, it shifted its strategy to seeking significant reader support, namely, membership (contributions, donations, gifts, whatever you want to want to call it), a business decision that a whole slew of other sites both large and small, for-profit and nonprofit, legacy or startup, have converged on in the past several years.

“We had just come off a lot of internal turmoil in the newsroom that left me with one reporter when I took over. People who care about journalism were aware that it might be a weird time to be asking people for support — um, wait, didn’t you destroy your newsroom? Some people did ask us, are you asking for handouts? I already gave to WHYY, but they’re nonprofit — why should I give to you?” Danya Henninger, Billy Penn’s editor, told me. For three and a half years of existence, Billy Penn hadn’t much touched the idea of readers giving money specifically to support newsgathering. “We answered people on social. We answered people who emailed us. I personally responded. There were alternatives: a paywall, popup ads and obnoxious reader experiences, content that relied on advertising. Going that way would change everything about Billy Penn.”

Billy Penn, now nearly four years old, is the original Spirited Media site. A sister site, The Incline of Pittsburgh, launched in September of 2016, and Denverite launched more than two years ago as part of a separate planned collective of local media sites but then joined forces with the Pennsylvania sites last year.

At the Lab over the years, we’ve closely watched the trajectory of Billy Penn — and other digital local news bright spots like WhereBy.Ussince its founding. It was ambitious but seriously committed to appealing to a local rather than national audience; it was mobile friendly and thought about user experiences; it was going to make ends meet through advertising and events.

Across all three sites, “we’re just south of 1,500 paying customers,” 60 percent of whom are signed up as recurring contributors (of these, the average annual contribution is around $115 or $120), according to Brady. The sites are part of the News Revenue Hub, which has inked a blueprint for building membership programs for news organizations; the Spirited Media sites have been following their recommended course around focusing on email newsletters and messaging closely, including time-pegged, shorter-run membership drives.

Because of an early focus on events, the for-profit company’s reader-derived revenue per month is already higher than its advertising revenue, but “for my purposes, I’d love to be in a place where events and memberships were 75 percent of our revenue,” said Spirited Media CEO Jim Brady.

Together, the sites now have 30,000 newsletter subscribers, according to Brady (he didn’t offer a breakdown per site). News Revenue Hub offers the guidance that about 10 percent of an organization’s newsletter subscribers typically become paying members within the year. “We’re on target to hit that in Denver, and are a little behind in Philly and Pittsburgh but not meaningfully so,” according to Brady.

The sites are making lots of nudges to try to get there. All three sites now have a “support our work” banner at the top of their homepages. They’re also thinking about how to adjust the website experience such that, for instance, someone who’s already subscribed to the newsletter wouldn’t get a newsletter prompt but a membership one, VP of product and people at Spirited Media Brian Boyer told me.

“We’re putting nudges all around,” Boyer said. “Something that News Revenue Hub taught us is that the website is for adding newsletter subscribers, and the newsletter is for making members. So the tweaks we’d want to make are to the website in order to introduce us to more regular readers, and getting them to read out newsletter, and then to the newsletter to get people to join us.” Then there are website speed improvements and design nudges.

“UX can be a good way to declare to your audience about what you care about. We have five topics listed across every news site. It’s a short list that orients a new reader to us, which is more powerful than its function in wayfinding on a site,” Boyer said. “So the literal navigation component is secondary, and the primary goal is to show people that we give a shit about power, development, about weird things, about transit.”

They sites are also learning from each other: Denverite, which launched its membership first out of the three sites, has so far added the largest number of members, around 900. It was also the site that, from launch, intended to lean on readers to help fund journalism, and so had always tuned its messaging to its readers to set these expectations.

“We didn’t launch with membership, and there are times I regret that. By the time we as a company were ready to go, we were just dying to do it,” Dave Burdick, the editor of Denverite, said. (Burdick had been in touch with News Revenue Hub just to gather some tips and ideas about the membership model before Denverite merged into Spirited Media, but News Revenue Hub, which charges a fee for its shared expertise and support, would’ve been too expensive for Denverite to justify alone.) “But it helped knowing from the very beginning was that we were really focused on trying to be approachable and to make receiving our newsletters feel intimate and friendly.”

Represented in the people paying for the are not just readers who’ve been with it from day one, but those supplementing their local and national news diet with Denverite, as well those who’re disappointed with legacy newspapers in the area, according to Burdick. “But we also have people who are reading local news for the first time, either because they moved to Denver, they aged into it — bought a house, had a kid, said uh oh, I need to find out what’s happening here — or some other event that caused them to find us,” he said. Few have complained about the frequency of their ask, he said, a tactic he and his journalist colleagues had to learn to get comfortable with.

The sites have also come up with ways to drum up some interest around each ask. Henninger of Billy Penn, for instance, decided to make a pitch around a new reporter the site hired, Max Marin. “Our goal: To have 350 members by the time Max starts on Aug. 13,” Henninger wrote in an initial summer membership drive email. Over at Denverite, Burdick, spurred by a Twitter conversation with someone over the digital local news model, decided to promise anyone who signed up as a member in a given time window that the first two months of their membership money would go specifically to records requests:

“It got around on Twitter. But nobody donated from there. Then we put the same messaging in an email to our readers, hey, did you see, Dave went crazy! If you’re into that, please donate. And that audience responded to it,” Burdick said. “There were the randos on Twitter who saw it and liked it. But it was people who already had some existing relationship with us, who had already been pushed some of our other messaging, who responded.”

The membership program is otherwise light on other perks (discounts to events, laptop stickers, a high-res skyline photo).

“I think I lost too much time and sleep trying to show that our membership perks were perfect,” Lexi Belculfine, The Incline’s editor, told me. “But people just want the journalism. Their membership perk is the journalism. The idea is, you can’t get anything else like it in the city, and beyond that, if you get a membership, yes, we have laptop stickers, yes, we have happy hours. But that’s not why people join. In the designing of our actual program, I’m not saying I lost sight of that, but I did assume that people would want more, for a news organization that already didn’t have any barriers to entry.”

“It’s important to us our news is free to people who need news,” Burdick said. “We just added a housing and hunger reporter. Some of the people who need and will read that reporting, many of them are never going to pay for Denverite; they can’t. And I don’t want to put that stuff behind the paywall, I don’t want to give it to anyone early. Our members appreciate that, that we work on stuff that matters most to somebody who’s not specifically them.”

A mechanism for regular kind words from readers to get to the newsroom has been motivating.

“One of my favorite things about this is when somebody becomes a member, we get a Slack notification that tells us why they’re joining. Hearing it from readers in their own words is nice,” Belculfine said. “That’s something our reporters have said — they say they get to hear positive comments from readers on a regular basis. I share the best comments with them, and people are funny and sincere and genuine, and it often feels like they describe the Incline better than I could describe the Incline to my friends.”

“Even if it’s just a couple of people out of the, say, 250,000 that visit our site every month, even if it’s just 20 of them who give, getting their support means so much, and definitely gives me new energy to continue doing the work,” Henninger said.

Photos of the Philadelphia, Pittsburgh, and Denver skylines by Tom Ipri, Always Shooting, and Robert Kash used under a Creative Commons license.

POSTED     Aug. 28, 2018, 11:10 a.m.
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