YOU WON’T BELIEVE WHAT HAPPENS NEXT WHEN I TALK TO JESSE COLOMBO’S BOSS
- Forbes.com pays contributors more for repeat traffic to discourage click-baiting
- Forbes pays around 400 contibutors to produce original content
- Forbes is making money, with online (53%) bringing in more ad revenue than print
Something's been nagging me after the whole Jesse Colombo thing.
To quickly recap: The economics analyst posted a piece on Forbes.com called 12 Reasons Why New Zealand's Economic Bubble Will End In Disaster.
But the economic debate was over-shadowed a number of commentators, including Bernard Hickey (on RNZ’s The Panel and elsewhere) and BusinessDesk’s Pattrick Smellie (on Stuff), who accused Colombo of once-over-lightly analysis, and a click-bait headline designed to pump up his audience, and his pay, under Forbes’ traffic-based contributor payment system.
All the protagonists, including me, were quoted a Poytner analyis piece from 2011, and an equally creaky editorial from Forbes Media chief product officer Lewis D’Vorkin, the father of the incentive-based contributor payment model (Forbes Media being the name for magazine's combined print, online and events business).
I recently had a quick phone chat with the New York-based D'Vorkin, and his comments are worth reading if you're interested in publishing, or the quality of what you read in the hard-scrabble world of online publishing.
The very fact Forbes' payment system is traffic-based, and some of Colombo's behaviour — including his and his tweet to Lorde and a follow-up post devoted largely to gloating about coverage and traffic — made it easy for critics to lump the site in with lazy repeater sites like Business Insider, Mashable and so forth with their endless repackaging and annoying social media teasers ("You'll never believe what happens next when ... ", "10 reasons the ... " etc).
But in a world where so many sites are repeaters, or aggregators (hello Yahoo and MSN), it's worth a nod to site that actually publishes original articles and commentary.
The entrepreneurial journalism model is worth investigation. I'm not sure it was right to beat Colombo over the head with it.
Here's what the Forbes boss had to say for himself:
Chris Keall: Jesse Colombo’s had a lot of media here for his bubble theory, but commentators have also criticised Forbes pay-per-click model – essentially saying he’s trolling New Zealand and exaggerating his theory to get traffic. So I was wanting to grab your response to that.
Lewis D’Vorkin: Jesse was recruited by our banking contributor, who had been following him for a few years and saw that Jesse had built a pretty substantial audience on Twitter and that many of the people retweeting his content were people our banking reporter respected.
CK: Is there potential for your traffic-based payment model to undermine contributor’s credibility?
LD: What undermines a contributor’s credibility is inaccuracy, failing to engage with the audience, and behaviour like that.
Jesse is a bubble activist. He’s built and audience that’s interested in reading what he has to say, and his audience feels compelled to share that content across the social web.
CK: There was one tweet he did to the New Zealand singer Lorde asking if she was interested in his theory about an NZ housing and credit bubble. Was that perhaps a bit over the top in terms of social engagement?
LD: I didn’t see the tweet so I can’t speak to it?
CK: There was a Poynter article that said Forbes.com pays contributors 10 time as much for repeat visitors. Was that stat correct?
LD: Our model is built around the notion of building a loyal following. And the best way to build a loyal following is to provide information that audiences find credible enough to come back to.
So that is correct that we reward our contributors who have a larger repeat audience on a regular basis.
[Terms vary by contributor. D’Vorkin didn’t want to go into examples of individual contracts - CK]
CK: So presumably that would punish people who use click-bait headlines?
LD: That’s the idea.
CK: Is Forbes.com making money?
LD: Forbes Media [online + print + conferences] has finished the last two years … they’ve been the most profitable in quite some time.
The media industry at large in 2008 and 2009 went through dramatic turmoil, and in 2012 and 2013, Forbes profitability has been its strongest since those difficult times.
CK: Have you broken out separate figures for print and online?
LD: We’re a private company … But it might interest you to know our digital ad revenues have now surpassed our print ad revenues, which is an extraordinarily unique thing in the media industry. Approximate 53% of our advertising revenue is digital.
[As with all publications, the growing proportion of online ad revenue will be in part a function of print revenue declining. Still, to get a majority of ad revenue from digital at this point in time is a stat that will impress those in the industry – CK].
CK: The incentive-based, entrepreneurial journalism – you see that as a factor in digital surpassing print?
LD: The entrepreneurial journalism model is one that we believe is very powerful given the state of the advertising industry today.
We also believe it’s a great model for freelance journalists, knowledgeable academics, and authors to be able to have a voice in a credible environment, and to be rewarded for attracting an audience.
CK: How many contributors do you have on the incentive scheme at the moment?
LD: We have about 1200 contributors on the platform. 400 of those are being paid, and about half of those 400 are journalists.
CK: I’ve read that the top-performing contributors can earn $US100,000+ a year. How many would that be?
LD: It’s half a dozen or so.
CK: What sort of traffic numbers would they be attracting?
LD: They attracting about a million or more unique visitors per month.
CK: Have you considered a paywall? [NBR’s argument is that as well as diversifying revenue, reader funded content means sharper content]
LD: We’re always exploring new things, but a pay model isn’t on our horizon. Pay models have their pluses and minuses. Our audience is so big that we’re continuing to pursue the advertising-supported model. However, we are exploring premium products such as e-books, and we have a premium newsletter business that’s doing quite well. So we’re looking to charge for content in areas other than the website.