What’s the Cure for Ailing Mashable, BuzzFeed and Other Online News Sites?

The news this week that Mashable would lay off 50 employees in the wake of a fire sale to Ziff Davis for $50 million is a sign of the times in digital news.

Just two years ago the company was valued at $250 million and won $15 million in new funding from Time Warner. Now a plunging valuation has become a painfully common affair across the digital space for both small players and industry titans.

Last week, BuzzFeed axed 100 employees and delayed a planned IPO after missing expected 2017 revenues by as much as 20 percent. A traffic drop prompted Mic.com’s much-maligned “pivot to video” — and dozens of layoffs. Vice also missed earnings, but you may have overlooked that story as the company prepared for what is expected to be a brutal piece in the New York Times about the company’s issues with sexual misconduct.

Also Read: President Trump Just Lost to Barack Obama (on Twitter at Least)

“Digital media publishers are looking for scale,” said Michael J. Wolf, CEO of Active, Inc., a management consulting firm for tech and media companies. “We’re at a point now where there aren’t many of these companies. You could look at Mashable and say it’s just too small. The other reason these companies need to get larger is because they need to be move their businesses into video.”

Scale, however, is far from the only problem. As a growing number of people consume content from Google and social media, companies like Mashable find themselves in an increasingly untenable situation. As distribution algorithms are constantly tweaked, media shops are left constantly scrambling, playing the role of digital soothsayers to a hostile web.

One former Mashable senior staffer told TheWrap that social media changes took a brutal toll on traffic during his tenure and that the company constantly was left floundering with no real strategy for developing other revenue streams.

Also Read: Mashable Lays Off Staff, Top Editor in Shift to TV

A similar story played out at news website Mic.com.

“It provides an opportunity where people think there is a system to play, a game to play. You start designing stories to play into an algorithm,” said a former senior editorial employee at Mic. “Then you start picking stories based on what will do well on Facebook. People start to focus on that and not the news itself.”

To that end, the company often employed what were known internally as framings, creating formulas like “In One Tweet [Sharable Person] Just [Thing Done].” A small cottage industry of “one tweet” posts were produced to document the pronouncements of author J.K. Rowling.

Also Read: Megyn Kelly: I Was Called ‘a Real C-Word’ After Debate Dust-Up With Donald Trump

Some examples include:

“In One tweet, JK Rowling shaded all the men asking why there’s no ‘Men’s Day’”

“In One Tweet, J.K. Rowling Just Sparked the Most Magical Celebration of Equality Eve”
“One Tweet from J.K. Rowling Perfectly Shuts Down Rupert Murdoch’s Anti-Muslim Rhetoric”
“In One Tweet, JK Rowling Tells Mic We’re Wrong”

The dependence on social media has put many outlets in a bind, David Cohn, Senior Director at Advanced Publications, told TheWrap. Media sites can’t ignore Facebook; they need to leverage the social network’s massive platform to funnel readers towards its content. But the money they’re making, in comparison to the gargantuan ad sales Facebook and Google rake in, is negligible. (The duopoly accounts for 85 percent of all internet ad growth, and combined will make more than $100 billion in ad revenue in 2017, according to Mary Meeker’s annual report.)

“That generation — [sites like] NowThis, Circa — it’s a negotiation, and they’re in a weaker hand. And the reason they’re in this pickle is because they don’t have this strong hand to demand strong tools to monetize. Facebook has that upper hand, so Facebook can monetize,” said Cohn.

Also Read: When Digital Media’s ‘Pivot to Video’ Goes Wrong

He pointed to NowThis as a textbook representation of new school media’s symbiotic relationship with Facebook.

“NowThis is really just a content creator for Facebook, that’s the relationship. Facebook is the distributor and NowThis is the studio — not unlike the movie studio and the movie theater,” added Cohn. “The situation we find here is that the distributors, the Facebooks and social platforms, are in a much better position to monetize, and in a much better position to dictate, because they own the product.”

As companies scramble for answers, outlets have increasingly turned to video to maintain their weakened grasp of the audience. But the pivot to video isn’t a surefire panacea. Mark Bonner, former managing editor at International Business Times, recently told TheWrap the strategy was anything but a silver bullet for the company. By adding autoplay clips, IBT aimed to keep eyeballs on the screen longer and, in turn, boost its ad revenue. That didn’t happen.

Also Read: Ted Cruz Says He’ll Serve With Roy Moore, But Al Franken Charges Are ‘Serious Problem’

“[The pivot to video] was forced on us, and I never got an explanation why, but I can only guess they were looking at the balance sheets and saying ‘this is a fast way for us to make up some gains,’” said Bonner. “It didn’t work, as far as I can tell, because we all got laid off.”

Compounding matters, goals put in place by many of the big money venture capital firms backing these companies has undermined the drive of their editorial teams. An obsession with traffic first, quality journalism second, has stymied the industry. And the impact of VC — and its share of the blame in the media-wide downturn — isn’t lost on those that have seen it firsthand.

“So many of these companies got a lot of VC [venture capital] funding and then at companies, like a BuzzFeed and Mashable, there’s an emphasis on growth. The way to grow is to get hits and the way to get hits is to publish stories that gets hits, not necessarily stories about hard news,” said the former senior Mic employee. “That shifts things away from journalism towards traffic and when you do journalism for traffic rather than for journalism, that takes the sail out of journalists, makes it harder to stay focused, and makes it much more of a business and commodity.”

Also Read: Why Fox Buyout Could Make Disney the ‘Most Powerful Company’ in Hollywood

So what’s the path forward? Cohn sees more companies turning to a “hybrid” business model — somewhere along the spectrum between BuzzFeed’s obsession with scale, and smaller subscription-based outlets like The Information. At the same time, the million dollar question boils down to how tech and media companies find a working relationship moving forward. The hysteria over social media wiping traditional outlets off the map is overstated, but fostering a more beneficial arrangement for quality content will have to be made.

“In truth, they need each other, and when push comes to shove, these tech giants know that and understand that. You can’t surf Google if no one’s producing content, and it means nothing to share content on Facebook if there isn’t good content being made,” said Cohn. “And there’s only so many cat photos people that people can really share. There has to be substantive stuff.” 

(Disclaimer: TheWrap media editor Jon Levine was formerly a staff writer at Mic).

Related stories from TheWrap:

California Wildfire Update: ‘Westworld’ Production Back on, ‘SWAT’ Still Off as Blaze Spreads

‘Jeopardy!’ Champion Slapped With Felony Charges

When Digital Media’s ‘Pivot to Video’ Goes Wrong

Mic Lays Off 25 Employees in Pivot to Video

Break Media Pivots From Sexy Photos and Prank Videos to Sci-Fi Movie With Lorenzo di Bonaventura

The news this week that Mashable would lay off 50 employees in the wake of a fire sale to Ziff Davis for $50 million is a sign of the times in digital news.

Just two years ago the company was valued at $250 million and won $15 million in new funding from Time Warner. Now a plunging valuation has become a painfully common affair across the digital space for both small players and industry titans.

Last week, BuzzFeed axed 100 employees and delayed a planned IPO after missing expected 2017 revenues by as much as 20 percent. A traffic drop prompted Mic.com’s much-maligned “pivot to video” — and dozens of layoffs. Vice also missed earnings, but you may have overlooked that story as the company prepared for what is expected to be a brutal piece in the New York Times about the company’s issues with sexual misconduct.

“Digital media publishers are looking for scale,” said Michael J. Wolf, CEO of Active, Inc., a management consulting firm for tech and media companies. “We’re at a point now where there aren’t many of these companies. You could look at Mashable and say it’s just too small. The other reason these companies need to get larger is because they need to be move their businesses into video.”

Scale, however, is far from the only problem. As a growing number of people consume content from Google and social media, companies like Mashable find themselves in an increasingly untenable situation. As distribution algorithms are constantly tweaked, media shops are left constantly scrambling, playing the role of digital soothsayers to a hostile web.

One former Mashable senior staffer told TheWrap that social media changes took a brutal toll on traffic during his tenure and that the company constantly was left floundering with no real strategy for developing other revenue streams.

A similar story played out at news website Mic.com.

“It provides an opportunity where people think there is a system to play, a game to play. You start designing stories to play into an algorithm,” said a former senior editorial employee at Mic. “Then you start picking stories based on what will do well on Facebook. People start to focus on that and not the news itself.”

To that end, the company often employed what were known internally as framings, creating formulas like “In One Tweet [Sharable Person] Just [Thing Done].” A small cottage industry of “one tweet” posts were produced to document the pronouncements of author J.K. Rowling.

Some examples include:

“In One tweet, JK Rowling shaded all the men asking why there’s no ‘Men’s Day'”

“In One Tweet, J.K. Rowling Just Sparked the Most Magical Celebration of Equality Eve”
“One Tweet from J.K. Rowling Perfectly Shuts Down Rupert Murdoch’s Anti-Muslim Rhetoric”
“In One Tweet, JK Rowling Tells Mic We’re Wrong”

The dependence on social media has put many outlets in a bind, David Cohn, Senior Director at Advanced Publications, told TheWrap. Media sites can’t ignore Facebook; they need to leverage the social network’s massive platform to funnel readers towards its content. But the money they’re making, in comparison to the gargantuan ad sales Facebook and Google rake in, is negligible. (The duopoly accounts for 85 percent of all internet ad growth, and combined will make more than $100 billion in ad revenue in 2017, according to Mary Meeker’s annual report.)

“That generation — [sites like] NowThis, Circa — it’s a negotiation, and they’re in a weaker hand. And the reason they’re in this pickle is because they don’t have this strong hand to demand strong tools to monetize. Facebook has that upper hand, so Facebook can monetize,” said Cohn.

He pointed to NowThis as a textbook representation of new school media’s symbiotic relationship with Facebook.

“NowThis is really just a content creator for Facebook, that’s the relationship. Facebook is the distributor and NowThis is the studio — not unlike the movie studio and the movie theater,” added Cohn. “The situation we find here is that the distributors, the Facebooks and social platforms, are in a much better position to monetize, and in a much better position to dictate, because they own the product.”

As companies scramble for answers, outlets have increasingly turned to video to maintain their weakened grasp of the audience. But the pivot to video isn’t a surefire panacea. Mark Bonner, former managing editor at International Business Times, recently told TheWrap the strategy was anything but a silver bullet for the company. By adding autoplay clips, IBT aimed to keep eyeballs on the screen longer and, in turn, boost its ad revenue. That didn’t happen.

“[The pivot to video] was forced on us, and I never got an explanation why, but I can only guess they were looking at the balance sheets and saying ‘this is a fast way for us to make up some gains,'” said Bonner. “It didn’t work, as far as I can tell, because we all got laid off.”

Compounding matters, goals put in place by many of the big money venture capital firms backing these companies has undermined the drive of their editorial teams. An obsession with traffic first, quality journalism second, has stymied the industry. And the impact of VC — and its share of the blame in the media-wide downturn — isn’t lost on those that have seen it firsthand.

“So many of these companies got a lot of VC [venture capital] funding and then at companies, like a BuzzFeed and Mashable, there’s an emphasis on growth. The way to grow is to get hits and the way to get hits is to publish stories that gets hits, not necessarily stories about hard news,” said the former senior Mic employee. “That shifts things away from journalism towards traffic and when you do journalism for traffic rather than for journalism, that takes the sail out of journalists, makes it harder to stay focused, and makes it much more of a business and commodity.”

So what’s the path forward? Cohn sees more companies turning to a “hybrid” business model — somewhere along the spectrum between BuzzFeed’s obsession with scale, and smaller subscription-based outlets like The Information. At the same time, the million dollar question boils down to how tech and media companies find a working relationship moving forward. The hysteria over social media wiping traditional outlets off the map is overstated, but fostering a more beneficial arrangement for quality content will have to be made.

“In truth, they need each other, and when push comes to shove, these tech giants know that and understand that. You can’t surf Google if no one’s producing content, and it means nothing to share content on Facebook if there isn’t good content being made,” said Cohn. “And there’s only so many cat photos people that people can really share. There has to be substantive stuff.” 

(Disclaimer: TheWrap media editor Jon Levine was formerly a staff writer at Mic).

Related stories from TheWrap:

California Wildfire Update: 'Westworld' Production Back on, 'SWAT' Still Off as Blaze Spreads

'Jeopardy!' Champion Slapped With Felony Charges

When Digital Media's 'Pivot to Video' Goes Wrong

Mic Lays Off 25 Employees in Pivot to Video

Break Media Pivots From Sexy Photos and Prank Videos to Sci-Fi Movie With Lorenzo di Bonaventura

When Digital Media’s ‘Pivot to Video’ Goes Wrong

You’ve probably seen it several times already: a website announces it is “pivoting to video.” It’s an eye-roll inducing cliche that nonetheless looms over the industry like a specter.

No one wants to read anymore, the conventional wisdom goes, and so it is that as digital outlets scramble to make money in an increasingly fractured media landscape, sites fire writers and turn to their new one true savior: Video.

Fox Sports axed 20 writing positions in June to focus on video. And millennial-focused news site Mic followed suit in August, laying off 25 members of its editorial staff.

Also Read: Amazon Irked After Google Abruptly Pulls YouTube From Echo Show

It’s understandable why those sites might think video is the way forward. According to data from Pew Research Center last year, more Americans prefer to watch their news (46 percent) than read it (35 percent) or listen to it (17 percent).

But that doesn’t tell the whole story. The same research also indicates a generational divide, one favoring reading over video in the long term. By a slight percentage, Americans aged 18-29 prefer to read their news; the same is true for people aged 30-49.

In other words, a blanket “video over copy” game plan is misguided — especially when targeting a younger demo.

Ask Mark Bonner, former managing editor of International Business Times. He’s seen how the bet can backfire firsthand. IBT placed a strong emphasis on video in early 2016, adding auto-play clips to all of its stories. Coupled with the site’s ad-heavy layout, the videos were a disaster, Bonner says. Rather than draw new eyeballs in, it scared readers away.

“I certainly saw it had a very adverse affect on the overall audience numbers, per day, per week, per month. That average time spent per page —  which was already very low — dipped even more,” Bonner told TheWrap. “Basically what was happening was, once they put auto-play in, and it was being married with the other programatic ads, it was like people were coming into the website and saying ‘oh man, I’ve made a mistake and I gotta go.’”

Also Read: 2 Chinese Investors Dump Stakes in Wanda’s Legendary Entertainment

The “hurried decision” rubbed both its audience and its editorial staff the wrong way, according to Bonner.

“It was offensive internally, and it was offensive externally [to the audience],” said Bonner.  “We paid for that, in terms of, the audience didn’t stay with us. And when the audience left, all hell broke loose for us.”

At the time its video strategy was implemented, IBT looked to be a well-oiled machine. The New York-based outlet had 125 writers and editors, churned out 100-15o pieces of content per day, and had 35-40 million unique visitors each month. As Bonner puts it, IBT had a “deep bench” that knew how to make the written word play online “down to a science.”

Also Read: Twitter Tests Doubling Tweet Length to 280 Characters

That formula was irredeemably tweaked once video was added. When asked what the driving force was behind the decision, Bonner had one word: “Money.” Looking to leverage its audience, the business arm of IBT aimed to generate ad dollars by ramping up video views. The results were costly.

“[The pivot to video] was forced on us, and I never got an explanation why, but I can only guess they were looking at the balance sheets and saying ‘this is a fast way for us to make up some gains,’” said Bonner. “It didn’t work, as far as I can tell, because we all got laid off.”

Instead of ushering in a new era for IBT, the publication sputtered. Its editorial staff dwarfed its video team, with only three people dedicated to placing clips on stories. When readers stuck around to actually watch the videos, the content routinely failed to compliment the written story. Bonner pointed to stories on Snapchat having political clips rolling alongside them.

Also Read: Saudi Arabia’s Decision to Let Women Drive Drives Twitter Jokes at Arab Nation’s Expense

The botched video rollout compounded underlying business issues for IBT. A round of layoffs came in the spring of 2016, followed by 32 more employees — including Bonner — losing their jobs early in the summer.

In hindsight, the muddled approach made it clear to Bonner pivoting to video isn’t as simple as throwing as much content against the wall as possible and hoping it sticks. An outlet has to have the internal bandwidth and talent to pull off an effective pivot.

Also Read: Steven Seagal Under Siege for Morning Show Interview: ‘Poor Man’s Bond Villain’

“Monetizing video isn’t easy,” said Bonner. “It really depends on what kind of publisher you are and the audience you have. And the rollout of that strategy has to be perfect.”

According to Similar Web, IBT’s current monthly traffic for the last three months has averaged around 21 million visitors per month. Data for the period prior to the site’s 2016 pivot is not publicly available, but current traffic numbers are about half of what Bonner tells the wrap the site used to get. TheWrap has reached out to IBT for clarification and comment.

However, data is available for Fox Sports: that site has seen its audience vanish since its pivot, with page views diving 88 percent.

Also Read: Michael Rapaport Rips ‘Dumb Motherf-ker’ Trump Over Stephen Curry Snub: ‘No One Wants to Meet Your Ass!’ (Video)

Now Editor-in-Chief of Bisnow, an online publication focused on real estate, Bonner said he’s “skeptical” when he hears about outlets pivoting to video.

“I don’t think we’ve got to a point where we can say, without a shadow of a doubt, that video is the future. It’s part of the future, but is it the only future? I’m not so sure,” said Bonner.  “And I wonder if at a certain point at time, when these videos realize how hard it is to monetize video, if they’re going to revert back to more traditional methods.”

Related stories from TheWrap:

Facebook Just Added NFL Highlights for All Games This Season

Facebook and the Future of Democracy, News, Free Expression and All That Stuff

Did Mark Zuckerberg Successfully ‘Diffuse the Potential Explosion’ Around Facebook’s Ad Biz?

You’ve probably seen it several times already: a website announces it is “pivoting to video.” It’s an eye-roll inducing cliche that nonetheless looms over the industry like a specter.

No one wants to read anymore, the conventional wisdom goes, and so it is that as digital outlets scramble to make money in an increasingly fractured media landscape, sites fire writers and turn to their new one true savior: Video.

Fox Sports axed 20 writing positions in June to focus on video. And millennial-focused news site Mic followed suit in August, laying off 25 members of its editorial staff.

It’s understandable why those sites might think video is the way forward. According to data from Pew Research Center last year, more Americans prefer to watch their news (46 percent) than read it (35 percent) or listen to it (17 percent).

But that doesn’t tell the whole story. The same research also indicates a generational divide, one favoring reading over video in the long term. By a slight percentage, Americans aged 18-29 prefer to read their news; the same is true for people aged 30-49.

In other words, a blanket “video over copy” game plan is misguided — especially when targeting a younger demo.

Ask Mark Bonner, former managing editor of International Business Times. He’s seen how the bet can backfire firsthand. IBT placed a strong emphasis on video in early 2016, adding auto-play clips to all of its stories. Coupled with the site’s ad-heavy layout, the videos were a disaster, Bonner says. Rather than draw new eyeballs in, it scared readers away.

“I certainly saw it had a very adverse affect on the overall audience numbers, per day, per week, per month. That average time spent per page —  which was already very low — dipped even more,” Bonner told TheWrap. “Basically what was happening was, once they put auto-play in, and it was being married with the other programatic ads, it was like people were coming into the website and saying ‘oh man, I’ve made a mistake and I gotta go.'”

The “hurried decision” rubbed both its audience and its editorial staff the wrong way, according to Bonner.

“It was offensive internally, and it was offensive externally [to the audience],” said Bonner.  “We paid for that, in terms of, the audience didn’t stay with us. And when the audience left, all hell broke loose for us.”

At the time its video strategy was implemented, IBT looked to be a well-oiled machine. The New York-based outlet had 125 writers and editors, churned out 100-15o pieces of content per day, and had 35-40 million unique visitors each month. As Bonner puts it, IBT had a “deep bench” that knew how to make the written word play online “down to a science.”

That formula was irredeemably tweaked once video was added. When asked what the driving force was behind the decision, Bonner had one word: “Money.” Looking to leverage its audience, the business arm of IBT aimed to generate ad dollars by ramping up video views. The results were costly.

“[The pivot to video] was forced on us, and I never got an explanation why, but I can only guess they were looking at the balance sheets and saying ‘this is a fast way for us to make up some gains,'” said Bonner. “It didn’t work, as far as I can tell, because we all got laid off.”

Instead of ushering in a new era for IBT, the publication sputtered. Its editorial staff dwarfed its video team, with only three people dedicated to placing clips on stories. When readers stuck around to actually watch the videos, the content routinely failed to compliment the written story. Bonner pointed to stories on Snapchat having political clips rolling alongside them.

The botched video rollout compounded underlying business issues for IBT. A round of layoffs came in the spring of 2016, followed by 32 more employees — including Bonner — losing their jobs early in the summer.

In hindsight, the muddled approach made it clear to Bonner pivoting to video isn’t as simple as throwing as much content against the wall as possible and hoping it sticks. An outlet has to have the internal bandwidth and talent to pull off an effective pivot.

“Monetizing video isn’t easy,” said Bonner. “It really depends on what kind of publisher you are and the audience you have. And the rollout of that strategy has to be perfect.”

According to Similar Web, IBT’s current monthly traffic for the last three months has averaged around 21 million visitors per month. Data for the period prior to the site’s 2016 pivot is not publicly available, but current traffic numbers are about half of what Bonner tells the wrap the site used to get. TheWrap has reached out to IBT for clarification and comment.

However, data is available for Fox Sports: that site has seen its audience vanish since its pivot, with page views diving 88 percent.

Now Editor-in-Chief of Bisnow, an online publication focused on real estate, Bonner said he’s “skeptical” when he hears about outlets pivoting to video.

“I don’t think we’ve got to a point where we can say, without a shadow of a doubt, that video is the future. It’s part of the future, but is it the only future? I’m not so sure,” said Bonner.  “And I wonder if at a certain point at time, when these videos realize how hard it is to monetize video, if they’re going to revert back to more traditional methods.”

Related stories from TheWrap:

Facebook Just Added NFL Highlights for All Games This Season

Facebook and the Future of Democracy, News, Free Expression and All That Stuff

Did Mark Zuckerberg Successfully 'Diffuse the Potential Explosion' Around Facebook's Ad Biz?