“The cost of starting a new publication has never been lower,” Jessica Lessin told us, “and the need for information has never been higher.” That quote could be Traffic’s tagline.
Lessin’s enthusiasm for the news business — her ability to clearly see the opportunities of the current media moment — is why she’s the subject of our cover story. She personifies a major shift in the conventional wisdom about how to build a sustainable media business. The days of scaling up fast and monetizing as an afterthought are giving way to upstarts like Lessin’s, where the business model shapes the editorial product from the outset.
We tried to capture that shift in this issue, which is filled with stories of entrepreneurs making real money using strategies that take advantage of digital media’s unique strengths. Looking at the online media landscape, we analyzed over a dozen major business models. Many companies combine several. Some rely on the kind of reach the internet enables, but many succeed by focusing on the loyal core — Ken Doctor discovered that just 7 percent of visitors usually supply a majority of revenue. And the passion of those readers can be as important as their numbers — the watch site Hodinkee built a booming online retail business with only about 800,000 monthly unique visitors.
The idea of a core audience that cares deeply about content is becoming important in entertainment media as well. The audience for today’s hit TV shows pales in comparison to that of previous decades, but the increasing importance of paid streaming services means more money is made on each viewer. In comics, the rise of tablets has let publishers create more material aimed at new audiences — which in turn is creating new fans.
Serving these dedicated audiences can be hard work — but it isn’t always as complicated as it sounds. Lessin boils down her subscription business like this: “Great journalism that you charge a loyal audience of readers for.” And she’s so confident in this model that she’s now incubating other subscription sites — in addition to growing her own.
As a technology reporter, Lessin understood how to build a business that can’t be commoditized by the platforms. For the biggest content companies, though, fighting back against the Silicon Valley bullies who stole their lunch money will require investing as much in the experience of media as the content.
That means the media business needs to develop a new set of skills. Strong content alone is no longer a recipe for success. Nor is technology, or picking the right business model, a cure-all. The media businesses of the future are being created when content, technology, and business align to deliver the value that consumers crave.
The digital media leaders featured in this issue have figured that out. This issue tells their stories so that we can learn from their examples and join their ranks.