By Diego Cruz
“I believe we are actually in the golden age of journalism [and] the possibilities for what is happening are really exciting,” said Michael Maness, the Knight Foundation’s Vice President for Journalism and Media Innovation, at a summit dedicated to understanding the innovative new revenue strategies digital media must adopt to sustain themselves.
More than 72 journalists and academics from 27 countries attended the Digital News Revenue Summit on April 3, presented by The Texas Tribune and the Knight Center for Journalism in the Americas. The daylong program, hosted at the University of Texas at Austin’s Belo Center for New Media, included discussion panels, research briefings and brainstorming working groups for the attendees.
In his keynote speech at the start of the event, Maness emphasized the need for news organizations to use innovation to adapt to an era of continuous disruption, where new technologies like mobile and wearable devices are changing the way readers interact with the news faster than ever before.
One of the biggest obstacles to this is the lack of what he called transformational leadership, a managerial approach that embraces disruptive technology and takes the time to understand the problems people face to create a product that helps solve them.
News organizations, like any other brand, can only survive if they create products that provide either delight or utility to their customers, and ideally both, Maness said. As an example he used an iPhone, which is both extremely useful and pleasant to use, making it a very successful product.
The way to do this is to adopt design thinking, a systematic process of studying the ways users interact with products and how these actually affect their lives so companies can satisfy their unmet needs, he said. Rather than trying to design a perfect and expensive first version of their product, companies should focus on making a cheap prototype quickly to test with users in different stages before eventually releasing to a larger public.
News media facing declining revenues can innovate by understanding the impact their work has on the communities they cover. Maness said a three-year research study conducted by Gannett revealed that consumer ideas of what makes media credible were very different from those a journalist might have. These characteristics included being authentic, having subjective viewpoints, being transparent regarding your intentions, being self-aware about your role as a reporter or blogger and focusing on reporting a single subject better than anyone else.
News organizations can also adapt by understanding they do not have to do all the work of information gathering or reporting. Through social media, people share their own stories, photos and videos, creating content journalists can efficiently curate for publication. Similarly, simple and generic data-driven stories can be written by computer algorithms, freeing journalists to focus on more complex and compelling work.
“In an era of continuous disruptions, you will have to stop doing some things to create time and space for experimentation,” Maness said.
Strategies at The Texas Tribune
After the keynote speech, staff members from The Texas Tribune spoke about how their work contributed to building a business model that went from depending on donations for 59 percent of its revenue to using corporate sponsorship, advertising and events to produce 45 percent of revenue in only four years.
April Hinkle, Chief Revenue Officer, spoke about sponsorships saying the Tribune focused on creating custom programs for each of their corporate clients, which took account of their goals, needs and budgets. By creating comprehensive programs that help sponsors tell their stories, the Tribune also builds a strong relationship with its clients that make them more likely to continue offering their support.
Director of Events Agnes Varnum said great and renowned speakers who provided a good experience for guests were essential to providing a “stellar program” that would make live events valuable. Part of this was also determined by who was invited to the event, since guests also attend events to connect with one another and learn something new. Varnum also warned that it is easy to overspend on events and companies should be keep production costs low.
Maggie Gilburg, Director of Development, said The Texas Tribune’s nonprofit model succeeded because it satisfied the unmet need to educate Texas citizens about important issues in their state, and donors had recognized this. This allowed them to diversify where their funding came from to increase firm revenue sources. Assistant Director of Development Natalie Choate said the key to getting people to contribute to The Texas Tribune was to constantly find new ways of promoting the nonprofit’s mission.
Speaking about crowdfunding campaign, Chief Innovation Officer Rodney Gibbs said it was essential to design very specific projects that make it clear to potential donors what they will be funding. Equally important is to ensure all preparations are ready before the campaign launches. Once that happens it will require constant maintenance and updates so it can sustain people’s interest for however long it lasts.
News Revenue Trends
Near the end of the summit’s morning program, Jesse Holcomb, Senior Researcher at the Pew Research Center’s Journalism Project, presented a number of statistics for current trends in news revenue. Key among them was that although audience and non-traditional revenue sources had grown it did not compare to advertising, which was still the biggest funding source.
While studying the nonprofit news landscape, Holcomb found that all of them tended to focus heavily on covering city and state issues, an area which had suffered in larger media companies. Most of their funding (three quarters) came from foundations, and while diversifying revenue sources was an important goal, the majority of nonprofits depended on grant money.
Regarding public views of the press, Holcomb’s research showed a surprisingly high number of people saw the media as serving a watchdog function and stopping leaders from acting irresponsibly. He emphasized the increasingly important role of audiences in news organizations, saying they were “more in control of the future of journalism” than they had been in a long time.
Note from the editor: This story was originally published by the Knight Center’s blog Journalism in the Americas, the predecessor of LatAm Journalism Review.
