Hyperlocal News Was Supposed to Thrive -- But Now It's Not. So What Happened?

Several years ago, as regional newspapers began shutting down in droves, the smart money was that hyperlocal media would not survive, it would thrive. As we wrote in  "The Prospect for Hyperlocal Continues to Look Good -- But Can It Capture the Ad Market?" back in 2009!, the reason was "because while there will always be sources for national news, people still want local news."

Many top national media wrote about the gleaming prospects for hyperlocal media. For example, Fast Company wondered: "Can Anyone Tap the $100 Billion Potential of Hyperlocal News? Community-driven news services have been the next big thing online for years. Can The New York Times or AOL find the $100 billion local-advertising pot of gold?"

So we weren't alone in thinking that hyperlocal would survive a meltdown among local media. After all, there are many competing sources for local and regional news but generally only one voice for hyperlocal media.

(By the way, it's worth pointing out that the subhead in the Fast Company article references AOL -- as an example of how much may have changed since 2009.)

We have a nonprofit client for whom hyperlocal is critically important to their work so we've been paying close attention. Over the past year, there's been a lot of cutbacks in hyperlocal media. The problem isn't interest in or support of hyperlocal media from readers. In many cases, the subscribers still want hyperlocal news but the economics outside the community remain terrible.

That's in part because newspaper chains like Gannett borrowed billions to acquire hyperlocal media to generate growth only to find out they had taken on too much debt and needed to make cutbacks.

Lots of cutbacks. According to a Boston Business Journal article, "Northeastern professor Dan Kennedy... referred to the latest round of layoffs as a ‘bloodbath.’ The company has closed at least 19 Greater Boston weeklies this year and has replaced much of the local coverage with regional stories."

The BBJ further noted "80 terminations across more than 50 newsrooms — but the full picture of what local readers across the country lost has yet to emerge."

19 community weeklies closed = news deserts?

That doesn't include layoffs at other hyperlocal papers, which has led to fewer reporters having to cover larger territories. That has led to fewer hyperlocal news and feature articles, which have been replaced by regional trend articles. A recent example: a look at the wobbly post-COVID locally owned restaurant market (as opposed to fast food chains) actually didn't quote any hometown restaurateur; instead, the article provided quotes from owners from several different communities -- some of them that may be an hour away. While the article was still interesting, it was not hyperlocal. The benefit for the editors is that that single regional article was published in different hyperlocal papers. That's how understaffed newsrooms can continue to publish news. It's just not hyperlocal news.

And that means that communities are not getting the kind of hyperlocal information they want or expect.

They've been what's been called "news deserts," defined by the UNC School of Media and Journalism's Center for Innovation and Sustainability in Local Media, as "a community, either rural or urban, with limited access to the sort of credible and comprehensive news and information that feeds democracy at the grassroots level." News deserts are a problem because it means communities aren’t getting critical information related to civic life, government services, etc.

Once limited to rural communities, news deserts now include suburban communities and even larger cities where alternate weeklies have closed, affecting large parts of those communities.

The reason this is significant is that hyperlocal newspapers support their communities, the businesses and the nonprofits, the students and the seniors -- it helps bind communities. 

Here's an example of how this plays out using Marblehead, the North Shore community in which we've maintained our global world headquarters because we've experienced some of the problem of a news desert.

We've been served by the Marblehead Reporter, a print weekly that has become thinner, with less hyperlocal coverage. Please keep in mind: we're not blaming editors or reporters; they're working under difficult conditions; but we do blame Gannett and hedge funds like the Alden Group that purchase newspapers and extract value while decimating the newsroom and the quality of the product.

We're also served by the Marblehead Patch, which seems to produce one actual news story about the community per day but does a better job of sending alerts than the Marblehead Reporter. The the email newsletter from the Patch makes it seem like there's a lot of new content but most of the newsletter features regional coverage. The Patch is good about fires, school closings, etc. -- which is useful information but we don't recall seeing a lot of articles that requires in-depth reporting about issues affecting the town. That would be information residents can't get elsewhere. (We can get school closing information from Boston TV stations, which post that information on their websites.)

With fewer hyperlocal news articles, residents tend to feel less connected. It also means that the paper is less important because some readers figure they don't need to read it closely because there's less info about the town -- replaced by more content about other communities (that they don't have time to visit). 

As a result, Marblehead has three new initiatives to build hyperlocal media outlets. We hope they take hold but there are issues with all three.

• Marblehead Weekly News, which is published by Essex Media Group, which publishes the Daily Item of Lynn, Lynnfield Weekly News, Peabody Weekly News, and other local media. It is staffed by reporters who also work on other Essex Media properties. We've seen one print edition, mostly focused on the upcoming primary so it's too early to judge. One problem is that there's not a website yet for the publication, just a weekly print edition. So there's currently nothing available at MarbleheadWeeklyNews.com. There's also not even a listing for the Marblehead Weekly News on the Essex website's listing of its various properties. We're sure that will happen. The weekly also includes some sports and features on the "Historic Building of the Week"; in a town with a starling number of pre-Revolutionary homes, the first choice was a local movie theater. On the other hand, the Marblehead Weekly News has brought out the Police Blotter, something the Marblehead Reporter used to publish and seemed to be quite popular (because the items reported included a report of spilled Cheerios in front of the Post Office). But, so far, and it's early yet -- no real news coverage.
• Meanwhile Marblehead News has an actual website. But it may not have a name because it posted an item in June 20, 2022 that it's crowdsourcing for a permanent name. Which is a good thing. We found it only because we were searching for Marblehead Weekly News and found them instead. Most of the news currently available on the site is campaign statements. Plus one article about the local movie theater -- we don't know who's handling its PR, but kudos! One thing that makes Marblehead News interesting is that two of the founding staff formerly worked for the Marblehead Reporter so we think that's a good sign because they know the town and they know journalism. But it's also a nonprofit that will try supporting itself by raising donations. Also, it seems like a part-time gig for them, and we don't blame them because they're taking on a risk  by working on this at all.  
• The third new outlet is called the Marblehead Beacon, which also launched in June 2022, and is run as a "citizen-based news site." As of press time (this article was written a couple of weeks before the updated blog and website were finalized), because the Massachusetts primary are a week away, the Beacon has a lot of content about local candidates. While we're hopeful about the Beacon, it is run by two businesswomen with limited journalism experience and other business interests along with a high school student who is handling technology (as one might expect). 

When we started thinking about this blog, we did not realize there were three news startups trying to provide a variety of print and online news for a community of some 20,000 residents. That's kind of a problem since we're media junkies who live in the community -- so we know they're not having significant impact yet. But we hope that will change.

Right now, political candidates are getting the most attention but it will be interesting to see how this plays out. Will the Marblehead Reporter respond, and if so, how? (We assume the Patch won't be able to.) And we don't know how closely part-time journalists will be able to cover the community news and issues beyond fires, roadwork/construction issues, etc.   

We're using Marblehead as an example but there may be similar efforts in other local communities. And we're not necessarily endorsing one of these outlets over another but we want them all to succeed in finding an audience and delivering news. Our point here is to continue a discussion about hyperlocal news sites and news deserts.

Let us know what you think about news deserts and news startups in your communities. 

Track Record 2020: How Accurately Did We Predict Key Trends for 2020

One thing for sure: 2020 won’t be easily forgotten.

It’s been a year that sadly redefined a new normal in how we live and work. We continue to track deaths resulting from the COVID-19 pandemic and see ongoing violence against people of color that sparked the Black Lives Matter movement.

We won’t be doing a comprehensive recap of the year – including the lives lost or disrupted, although our hearts go out to all of them – because that’s outside the scope of our trend analysis.

As we’ve done each year for nearly 20 years, we will review the trends we identified the previous year and grade how we did for each prediction.

1.  Distrust of Big Tech and media fuels anxiety. We got this one right – noting that “This will fuel feelings of anxiety, anger, exhaustion, and isolation, regardless of political perspective” – though we underestimated the scale of the distrust or the anxiety. This is a significant problem because American generally live in one of two news bubbles, ones that communicate vastly different narratives so that we don’t operate with a single set of facts. This will continue to fuel distrust and anxiety in 2021.  Grade: A.

2.  The loss of local news coverage will continue, and will erode trust. According to Axios, “In the first 6 months of 2020, more than 11,000 newsroom jobs have been lost. That's nearly as many as were lost in all of 2009.” We’ve also seen many local papers reducing the number of days they publish, scaling back their print editions or going out of business. We were right about the continued loss of local news; we have not seen data yet about the impact of that loss. But we know that the trend impacts how local news gets reported and what kinds of local news gets published. This trend will continue in 2021. Grade: A.

3.  Streaming services will get a lot of media and consumer attention. We said that the so-called streaming wars is not a zero-sum game, that American consumers will choose to subscribe to several streaming services, not just one, and we got that right. Streaming services became even more important in 2020, with some like Disney+ premiering movies that would otherwise have been released first into movie theatres. We also believe we were correct when we noted that, “The growing number of ad-free streaming content services will make it harder for marketers to reach a mass audience. Even ad-supported services will be out of reach for local and regional organizations so they will need to look for other ways to reach local customers.” Grade: A.

4.  The Gig Economy isn’t just for millennials. We said to expect older Americans to enter the gig economy, and they may have but the pandemic hurt the gig economy. The gig economy did not get as much attention as it should amid huge losses of traditional jobs this year, nor did the impact on gig workers who don’t get benefits like unemployment checks when their jobs dried up. We believe that after the pandemic – whenever that is – the gig economy will recover, but gig workers will want a safety net to help them in case of future job losses. Grade: C.

5.  Consumer spending patterns are shifting. We said consumer spending would shift from owning to renting things like ZipCars, Citi Bikes and any number of sites that rent the latest fashion trends. On a short-term basis, spending did shift though that was due to the pandemic. Long-term we think that what we call the “non-ownership economy” or the “convenience economy” will continue. Grade: C.

6.  The sharing economy will become more expensive. We said to “expect (that companies will pay) more attention to gross margins (a measure of profitability), detailed financial models for startups looking to raise money, and a focus on discipline” as opposed to focusing only on growth. Instead, many companies focused on survival in 2020, which included pivoting to offer new products and enter new markets. That said, Netflix recently announced it will increase its monthly rates, and we think others will follow. Grade: B-.

7.  Streaming — but not owning — content increasingly means you might not be able to access the version you want. We said, “Consumers will become increasingly aware of the risks of streaming, which include ongoing monthly costs that will increase; content that disappears when a streaming service loses its rights even if you were in the middle of the program); and services that might disappear or abruptly shut down. Grade: A. 

8.  Going cashless will also affect consumer spending. Driven by the pandemic, contactless was huge in 2020 as almost everyone shifted to Venmo, PayPal, Zelle and other services. Many of us have hardly used cash all year. We can’t tell if contactless affected spending since retail was hurt by the pandemic. We do stand by the statement that “An increasingly cashless society will make it much more difficult for the poor, who may be unbanked (as the banking industry calls it) and can’t get a credit or debit cards.” Grade: A.  

9.  Robots won’t take over in 2020 but will be more commonplace. Robots will likely see a boost om a post-pandemic environment but we did not see as much coverage in 2020 as we expected. Grade: C+.

10. The age of plant-based “meats” has gone mainstream. This was a significant food trend though not the biggest of the year (that was cooking at home). Grade: A.

These were our initial sets of trends. We will post the next set on Monday, and will give us a final grade for the year. 

More on the Death of Retail

The economy may chugging along but the retail sector is falling behind.

Way behind. 

As of April, 2019 has seen more store closings (or announcements of store closings) than all of 2018. According to Coresight Research as reported in the New York Times, there have already been 5,994 store closings by April, exceeding the 5,854 stores that closed in all of 2018. The good news: we still have a ways to go to reach 2017's record of store closings of more than 8,000.

There is one bright spot: the number of discount or dollar stores is booming because they are less susceptible than other retailers to e-commerce. (On a recent college tour in upstate New York, one of our team members saw plenty of dollar stores in some of the more rural areas.) 

But total store openings are stalled. There have been 2,641 store openings announced compared with 3,239 openings last year.

As an agency, we don't handle retail clients -- although the head of the agency spent several years supporting a provider of retail technology -- so you may wonder why we're so focused on retail.

We think it's the canary of the economy. There's clearly a shift in how people shop and purchase, and often it's away from bricks-and-mortar stores even as once web-only retailers like Amazon or Warby Parker now open retail locations.

But the trend seems to be more store closings, which leads to shrinking local ad revenues (because shuttered retailers don't take out ads to promote sales), which hurts journalism. In rural area, there's been a decline in local news coverage, according to the Pew Research Center. That's a real problem because that kind of local coverage is unlikely to return.

Behind the somewhat self-interest in the state of journalism, shuttered retail locations means fewer people working, and a potentially emptying out of main street stores and nearby malls. You can see the negative impact even in places like Manhattan's SoHo district, and it makes a difference, not only affecting real estate but communities beyond. A Bloomberg Businessweek article a while back depicted the problems faced by some towns in the UK, where retailers had left, which meant residents had to travel twice as far to buy things. Which meant that new residents are less likely to move there.  And that could cause a further spiraling effect.

None of which is good.

We don't have a solution, and we're not suggesting drastic measures to curtail Amazon and others' market power.

We just think it's an important issue, and one we've been regularly mentioning in this blog for the past several years. We also discuss other topics that impact journalism and PR. 

6 Challenges Facing Local Newspapers

Last year, we talked about "Five Challenges Affecting Local TV News." And last month, we talked about the challenges facing digital media ("BuzzFeed, Gannett, HuffPo All (Unfortunately) Validate Our Prediction About Media Layoffs.") This  week, we will look at problems facing local newspapers.

Unfortunately, there's a lot to talk about.

Last week, a newspaper holding company with an unlikely name, Tronc, provided more evidence that local newspapers are facing tough times.

Tronc stands for Tribune Online Content, and it is the country's third-largest newspaper publisher (behind Gannett and McClatchy) and owns 11 daily newspapers including the Chicago Tribune, Baltimore Sun, and the Orlando Sentinel. (In June, Tronc sold off the LA Times for $500M.), And last week, Tronc fired 50 percent of the staff of the New York Daily News and staffers at its other papers due to what its CEO said were because "As a public company, we have a fiduciary obligation to balance the interests of all of our constituents: shareholders, employees, readers and community."

Death by a Thousand Cuts?

An Axios article on the topic quoted The Washington Post's Paul Farhi as noting "the NYDN employed 400 journalists in 1988. After a layoff last year, it will 'have a newsroom staff of just 45, according to people at the paper.'"

It's hard to imagine even the Daily News -- perennially described as "scrappy" -- being able to cover the city that never sleeps with just 45 reporters. Or how the Daily News can survive against the New York Post, its longtime tabloid rival.

A number of journalism experts say problems started before Tronc acquired the Daily News (for only $1 in 2017 -- basically the newsstand cost of a single copy of the paper in 2016 -- along with an assumption of liabilities and 49 percent stake in property where the Daily News' printing plant is located. But things got worse after Tronc's purchase, described as ownership without strategy and that Tronc made (and continues to do so) by "making the product worse while making the public pay more."

Problems Facing Local Newspapers

in Tronc's case, some blame incompetent owners who took on too much debt through acquisitions and consolidation. This is a real concern as media giants are merging (AT&T-Time Warner; Disney-Fox, and Sinclair-Tribune -- the former parent company of what became Tronc), with the possibility that the acquiring companies may be taking on too much debt.

Beyond possibly incompetent owners, the main threats to local newspapers include:

1. Falling ad rates: The common saying is that publishers are replacing print dollars with digital dimes because online ads generate a fraction of the fees charged for print ads. So even if a newspaper retails the same number of advertisers who purchase the same number of ads, digital ad rates are much lower so newspaper revenue will drop. For example:
• For example, according to the MinnPost, a nonprofit local news site, "In 2011, newspapers lost about $2.1 billion in print advertising. Meanwhile, their digital advertising grew by about $207 million. In other words, they lost $10 in print ads for every new dollar of digital ad money.
2. Growing reliance on news aggregators and social media: Quality journalism remains expensive to produce but 67 percent of Americans get at least some of their news from social media, according to a Pew Research study. And growing numbers of us access news via Google News and Apple News, which provide free (or low-paying) access to news reported by a third-party. So even if online readership is up, some outlets are seeing revenue drop. Another problem: readers begin to rely on news aggregators instead of the news sources, making it harder for local newspapers to form strong relationships with their readers. 
3. Readers of Print newspapers (instead of online news sites) are getting older. The population of readers who rely on the printed paper is getting older while younger generations are more comfortable accessing news online for free. Newspapers need to find a way to make themselves relevant enough so that younger readers will pay for access. While the New York Times and Washington Post have seen a surge in online advertising, those two papers are exceptions because of how they've been covering national political news.
4. Smaller staffs means smaller papers and less ad space to sell. Do you see where this is going? Cutting back the size of the paper or the frequency of publishing a printed version of the paper means that publishers sell less advertising, so ad revenue continues to drop, which leads to more newsroom layoffs, and a worse product. This is a death cycle for local papers. 
5. Declining credibility. Right now, the entire journalism sector faces a tough time as credibility of the news is being questioned. But newspapers with smaller staffs won't be able to adequately cover their markets. That means they will be publishing a product offering declining value. Under those conditions, circulation and ad rates generally fall.
6. No strategy to sustainability. The long-term business model has shifted, and no one yet has found a replacement business model that will return local news to profitability. (The Daily News reportedly lost an average of $30M over the last three years, according to the New York Post, including due to circulation declines.) The one strategy that seems to be working for the Washington Post and the LA Times is to have billionaire owners who see the important of keeping newspapers running, and can afford to do so. But there are only so many billionaires who see the value of keeping local papers around. 

The real problem is that local newspapers serve as a check-and-balance of local government and we need local oversight of government.

Some cities are seeing the rise of nonprofit news sites (like MinnPost) and others. But some are very small operations; and you can't effectively cover a big city with just two reporters/bloggers. (In some cases, these bloggers are not much more than citizen journalists, without real journalism experience.) 

So what's the solution?

In an article entitled, "Who suffers when local news disappears," The Cumbia Journalism Review says, given declining resources, the quality of local papers will decline so much that:

At some point not terribly far in the future, even those of us who believe powerfully in the need for a vibrant local news landscape are going to be hard pressed to make a case that many of these outlets should be saved.

For much of this decade, no one has been able to develop a true workable solution. Readers' relationships with their local papers and with journalism in general has changed. And, as with the coal industry, there's no turning things back to how things used to be. 

Certainly newspapers -- as with all news operations -- need to figure a way to ensure they publish quality journalism, coverage that is credible and compelling, and available across different channels (print, online, text, video, social). But they also must find ways to charge for access. A number of top news sites provide access to a limited number of articles per month, so when readers hit the limit, they may be inclined to subscribe. Right now, readers seem to wait out until the next month.

Sustainable local newspapers is important for journalists and good government. But it's also important for marketers, who need credible vehicles through which to communicate their messages.

Five Challenges Affecting Local TV News

A couple of years ago, the demand for hyperlocal information as well as the recognition of marketers that were willing to pay to reach a hyperlocal audience  was seen to be a boon for local media. The trend indicated hyperlocal media would generated more eyeballs and receive more marketing dollars.

Unfortunately, while there's still strong demand for hyperlocal news, local print and broadcast news outlets are facing challenges. 

For local papers, one previously unanticipated problem was the dependence on advertising from local retailers. The retailpocalypse, which describes the sector's meltdown resulting in the shuttering of hundreds of stores (likes Sears, K-Mart) or the bankruptcies of entire chains (Toys R Us, Bon-Tons), has also resulted in a significant drop in local newspaper  advertising. So we've seen local newspapers shrink in size or close. 

It's gotten to the point that Dr. Michelle Ferrier at Scripps College of Communication at Ohio University has developed an interactive map called The Media Deserts Project to "identify areas that lack access to fresh, local news and information. We map layers of daily newspaper circulation, hyperlocal online news sites and other emerging media to identify underserved and underrepresented communities." The vast majority of the country, according to the research, has 0-2 daily newspapers -- and this incudes large cities. New Jersey (is) poised to invest $5 million into local journalism to shore up local reporting.

So local newspapers have to find new ways to get the money necessary to sustain their local journalism. That may mean experimenting with new business models.

Meanwhile, while local TV news may not have been as vulnerable to the loss of retail advertising. they face a different set of challenges. Unlike local news, one of the fundamental challenges to local TV news is the product itself.

1. Local TV news programs compete not only with other local TV news but also with social media. Competition for local broadcast used to be between ABC, CBS, FOX and NBC. Now it's from Twitter and Facebook. So news departments are very well aware their competition has expanded significantly. It also means that local TV news is more inclined to broadcast clickbait stories that are quick and easy to tell, rather than more meaningful news that may have more impact on the community.
   


2. They typically have more hours to fill but not more resources. A generation ago, the local news had two broadcasts at 6pm and 10pm or 11pm. These days, local news may air at 4pm, 5pm, and 6pm plus 10pm or 11pm. Unfortunately, news departments haven't gotten larger to help cover more news. So reporters have to repeat the news on different programs, producing a segment at 5pm and another segment offering a different take on the same story at 6pm. Or they have to find two stories, one to tell at 4pm and another at 6pm -- which means they don't have much time to develop either story.


3. Reporters are pushed to post their stories on social media, too. Sometimes the people who are scooping the 6pm News are the reporters themselves who are incentivized to push content out via social media. (Station bosses look at the number of followers for each reporter, the amount of engagement, etc.) So you can see behind-the-scenes aspects of the day's story on their Twitter or Facebook feeds. (These posts often include links back to the station's website.) So while they're putting together a package to be broadcast, reporters also have to keep in mind how to tell the story effectively via social. 


4. Broadcast reporters must be multimedia-friendly. They produce their package, then Tweet about it, then write up a text article for the website,  and then also produce a video that has photos and captions but perhaps no actual footage of the reporter. That last format is ideal for commuters who want to watch video but don't necessarily want audio to accompany it because it's noisy on the subway or commuter rail.


5. The tail wagging the dog is views, likes and clicks, not policy stories. The slogan for local news used to be "If it bleeds, it leads" the broadcast. While that's still the case, story selection is often based on what will get the most viewership, not necessarily what news will affect the community. This result: the further clickbait-as-news that is shorter, cuter, fluffier -- which many reporters don't like but must follow. The more significant kind of news takes more time to research, develop and tell -- and reporters don't have much time; they've got overwhelming and competing demands placed on them. 

There are structural issues facing local print and TV news, and local outlets have to evolve with the times -- and this has been going on, in one form or another since the early 1980s, setting up 1987's "Broadcast News." But this post is in no way trying to blame reporters, producers or assignment staffs. Their jobs have gotten tougher -- no question. 
The intent is provide consumers of local TV news with a sense of what's driving the type of coverage being produced, and to keep that in mind when they watch, read or "like" a segment. It's also to help businesses think about how they approach local TV news if they want to get coverage. 

Let us know if you think we got this wrong or if you have insights into how local media can address the challenges they're facing.