The biggest mistakes of media startups
For starters, they don't know the difference between money and value
You’re reading the My News Biz newsletter, which I send every Thursday. My goal is to help media entrepreneurs like you find a sustainable business model.
Recently I was asked on a podcast, “What are the biggest mistakes that startups make?”
The No. 1 mistake that journalists and publishers make is to ask people to pay for their product without knowing what people value. They publish what they, the journalists, value. Sometimes their instincts are correct, but many times they are pushing the wrong kind of content through the wrong channels.
The solution? You should start by finding out what your target audience values. Ask them. Put out surveys on your website or through your social media distribution channels. Invite people to events and talk to them. Create some online focus groups.
The most successful media organizations understand the information needs of their audience. What are their daily problems that aren’t being addressed by other media? How can your publication help them find solutions to their problems?
Finding answers to those questions will help you differentiate yourselves from all the other media out there. You will be creating value for your audience. You will earn their loyalty. Loyal audiences are much more willing to pay for products.
The No. 2 mistake is leaving the marketing and sales to the journalism staff. I’ve spent a lot of time in the newsrooms of startups, and I can tell you that journalists will always put marketing and sales on the back burner. For them it’s a secondary issue, until there is a crisis.
For journalists, there is always something more that they want to be doing on their news stories. Many journalists don’t feel comfortable talking about money or asking people for money.
So they need to get someone internally or externally who is comfortable asking for money and selling the value of the product. Because if they don’t, they’re going to suffer.
The No. 3 mistake is related to No. 2. Media startups have too many journalists on their staff. They need to balance marketing, technology and journalism. Many have the soccer (football) equivalent of 11 midfielders when they need some attacking forwards (sales staff) and defenders (the technology and digital marketing team). You need a balanced team. If your internal team doesn’t have the right skills, you need to bring people in from the outside.
The No. 4 mistake is an old one that we shouldn’t even have to talk about—they assume that advertising will sustain a publication financially. The new business models for quality journalism depend on multiple revenue sources.
Since the key to a startup’s success is going to be differentiating itself, by definition it has to focus on smaller, loyal audiences. The new metrics of success are not massive quantities of unique users and page views, but loyal users who return again and again.
The global trend in digital media is toward funding from users rather than advertisers, on relationships with users rather than massive scale. This new model is based on a relationship in which users value what the publication does for them and their community. That value then translates into people paying for subscriptions, memberships, event sponsorships, native advertising (sponsored content), e-commerce, media consulting, publication design or other services.
People are looking for media and products they can trust. A way to stand out is to make credibility part of your brand and the brands that sponsor you. Credibility is in high demand and short supply these days. Credibility adds value, and that can translate into money and other forms of support.
This edition of the newsletter is based on a podcast interview I gave to DW Akademie.