Everyone likes the idea of a thriving website sustained by a community of local readers. But too often “local” has been the stuff of journalistic ideals rather than real-world business plans.
The real-estate blog Curbed and its sister food and shopping sites, Eater and Racked appear to be bucking that trend. The sites, which are owned by Lockhart Steele, cater to local audiences looking for buildings, restaurants or sales. How has he made local pay when others like AOL’s (s aol) hyper-local network, Patch, have flopped?
“It’s a little counterintuitive. We’re a local company that’s not really interested in local advertising,” says Steele, explaining that the sites’ primary sponsors are national brands with big ad budgets like Ben & Jerry’s or Absolut Vodka.
Steele says big brands use Curbed to tap into local communities of shoppers, foodies or home buyers in different regions. He cites a recent example in which Curbed threw a party in Portland on behalf of Patron Tequila. “We can activate audiences in each of these cities we’re in, and activate a real community.”
Steele says there simply isn’t enough money in local advertising – with one exception. “The one place you can sell local is real estate … It’s the only category of hyper-local that’s really flush with money.”
Publishers are watching with growing consternation as audiences are moving en masse to mobile devices but ad dollars are not. Steele admits he doesn’t know how or when the mobile riddle will be solved but says he is not concerned.
Steele says it’s unrealistic to expect readers to download a publisher’s app unless you offer “non-stop engagement like Netflix” and adds that apps “create another distracting channel that you have to worry about.” He says Curbed is content to watch the mobile experiments of companies like Conde Naste which have been more bullish about apps.
“A lot of interesting start-ups in the digital media space are sitting on the sidelines .. We’re happy to see big guys throw around hundreds of thousands on development. We’ll keep our powder try and watch others. If someone hits on the right strategy, we’re not above copying it.” In the meantime, Curbed is content to look for niche mobile opportunities like email newsletters and monetizing the screen that launches when a reader first downloads an app.
Steele says his favorite sites are those that use a traditional blog layout like the Awl or Andrew Sullivan. He believes in a format that lets readers “scroll down and know when they’re full,” versus busy homepages like New York magazine which Steele describes as “seizure-inducing” (though he loves NY mag’s content).
Does he still follow Nick Denton, his former mentor and boss at Gawker, where Steele was the gossip site’s longtime managing editor?
“I still think Nick is one of the most interesting people in media. When it comes to product vision in this media space … I think Nick is pushing forward some of the most interesting ideas,” he said, citing Gawker’s recent attempt to transform the idea of reader comments.
Who else? Steele calls Jim Bankoff and Vox Media the “standard bearer for the media space,” He says sites like Vox Media’s The Verge are “the most beautiful on the web” for their seamless integration of text, audio and video.
Display ads are the Future
No really. While prominent display skeptics like BuzzMedia’s Jonah Peretti claim that banners (those ads that stretch across the top and side of web pages) belong to an earlier era of web publishing, Steele disagrees. “Display advertising is the future. Part of the reason is that display is also the past – people made fun of banners when they debuted on Hotwire in 1995.”
Steele’s point is that display advertising is a staple of the internet economy that publishers and advertisers now know how to buy, use and sell. He says companies continue to see these ads as powerful opportunities to build brand image. This is different than revenue from “click-through” ads about which “no one has illusions.”
To make display advertising work, Steele says, it’s important to keep ad sales in-house. “Giving inventory to ad networks puts you in a world of spiraling CPM’s.”
“The old idea that New York created media and San Francisco created great product is out the window,” says Steele, citing Foursquare, the popular location-based social network, which long shared a roof with Curbed. He believes both cities are pushing each other to improve media platforms and publications. But that doesn’t mean he likes them equally.
“I’m a tried and true New Yorker. If lived in San Francisco, I’d have to kill myself. Other than that it’s a great city.”