As hyperlocal publishers search for new ways to generate income outside of online display advertising, ancillary revenue streams are moving into the forefront.
With online adverting rates continuing to decline, savvy digital publishers are looking to pursue every income generation strategy available. New opportunities to create ancillary revenue streams are allowing publishers to capitalize on the positive sentiment and goodwill they’ve created in their communities, and also serving as a diversification strategy that could offer protection should digital advertising rates fall any further.
Having multiple ancillary revenue streams means publishers are less reliant on traditional forms of advertising. If advertising rates get to an unsustainable place, publishers who’ve already started generating ancillary revenue will be at a marked advantage.
Here are five ancillary revenue opportunities available to publishers today:
1) Local Events
Event production gives local publishers the opportunity to generate ancillary revenue and promote their brands in a positive way.
The types of events that hyperlocal publications can host range from the small—like high school sports banquets and subscriber meet-and-greets—to the largest events imaginable, including music festivals and city-wide restaurant tasting events. In St. Louis, KMOX Radio produces Food Fight, an annual event where local chefs compete for the title of St. Louis’ Food Fight Champion.
Planning events takes hard work, commitment, and significant resources, especially for local publishers who aren’t used to running these types of operations. It’s often worthwhile to hire a local event planner, even if that cuts into profit margins.
2) Members-Only Podcasts
Podcasting is one of the fastest growing media channels. Rather than giving their podcasts out for free and relying on advertising revenue to support the endeavor, some publishers are turning their podcasts into premium experiences and charging readers to listen.
Publishers can structure their members-only podcasts in a number of ways. For example, some publishers lock all of their podcasts behind paywalls. That’s probably the least common option among small media companies. What’s more common is for local publishers give offer their subscribers an ad-free listening experience. Another solution that’s popular right now is to create two versions of each podcast, a short version that listeners can access for free and an extended, premium version with more in-depth reporting that only paying subscribers or members can access. In this case, podcasting becomes a tool that publishers can use to incentivize readers to become paying subscribers.
3) Online Stores
Whether a publication launches an online store really depends on if the company has anything to sell. In The New York Times Store, readers can purchase Times-branded apparel, like umbrellas and baby clothing, personalized books that contain news stories from important dates in histroy, front page reprints, maps, and books written by Times reporters.
Publishers who run their websites on WordPress can use the WooCommerce plugin to sell digital and physical products through their sites. The Printify for WooCommerce plugin can be used to print logos on products, like t-shirts and hats, on demand.
Hyperlocal publishers know their communities better than anyone else, making them well positioned to sell eBooks on a wide variety of city-specific topics. From local history to tourist hot spots to comprehensive guides on dining in their towns, there are limitless opportunities for the entrepreneurial publisher.
Publishers have the option to commission books from their writers, or pull together content that has already been published, such as restaurant reviews. eBooks can then be sold through the publisher’s own website or given away for free as part of a package for new subscribers.
5) Subscriber List Rental
Perhaps the most controversial ancillary revenue solution on this list, list rentals involve giving out subscriber email addresses to businesses in exchange for a fee. The practice can be lucrative, as brands are willing to pay a premium for the service, but it can also dissuade readers from signing up to become subscribers and ultimately damage the publisher’s reputation if news of the practice gets out.
Somewhat less controversial is the co-branded email program. Rather than handing out their subscribers’ complete contact details, local publishers can send out co-branded emails together with outside companies.
Utilizing a variety of ancillary revenue opportunities, publishers can diversify their income and ultimately build more sustainable media organizations.