One of the things we’re asked every now and again as individuals working in the online media space in Zimbabwe is, how does the business side of this work. Or put plainly, “how do you make your money?”
Sometimes this is asked by some seasoned journalists and content creators keen to understand better what kind of business opportunities are available for their kind of work online.
We thought it would be a good idea, therefore, to break down the common business models, or plainly, the ways to make money. For each business model we’ll list well-known media brands that employ the method.
If we leave out a business model (or revenue stream) that you feel we should have included, please just post it in the comments below and we’ll consider it for inclusion.
How this works is that a publication approaches local businesses and asks them to advertise on the publication’s website or social media streams. This normally works for established media brands whom the advertisers probably know already. It also works because these publications usually have a sizeable audience that the brands are keen to access.
Smaller publishers, that may not be well known yet, are still able to access some of this direct advertising business if their leaders are well networked. Of course niche publications can be attractive to specific brands that want to reach an audience that is drawn to those niche interests.
Usually, the advertising is charged as a flat monthly fee regardless of the actual number of clicks or impressions that the advertiser gets.
Large brands that advertise on such publications are typically FMCG brands (Innscor, OK, Delta, National Foods), telecoms & tech companies (NetOne, Cassava, Econet, TelOne), financial services companies (CBZ, Old Mutual, GetBucks, EcoCash) and other such large companies.
Usually, the large company does not deal with the publication directly, preferring instead to deal with advertising agencies like DICOMM McCann, MultiMedia, Jericho, Barkers Ogilvy, ShiftEngage, Adrenalin and so on. This layer serves both the publisher and the brand well as agencies take on the role of translating what the publisher offers in audience to an integrated advertising campaign. Also, it’s easier for brands to work with one agency, which then takes the burden of talking to various publishers and creating a campaign for the different audience types.
Needless to say, large brands (and especially going through an advertising agency) means payments are not immediate. In our experience, publishers can get paid anything from a month to even 9 months. This of course becomes an amplified problem when in a hyper inflationary environment like we are in right now.
Publishers using this business model include:
Internet advertising networks are the easiest way to start showing adverts on one’s site as it does not take any of the hard work of selling one’s publication to direct advertisers. One can literally start showing adverts immediately after going live with their site. As a result, almost all new online publications have Adsense adverts.
Adsense is the most common not because it’s the only one but because it’s Google and widely passed by word of mouth.
Being easy to start however does not translate to making easy money. The Adsense platform essentially enables advertisers to be paid for clicks made on adverts displayed on the site. A decent range of how much publishers using Adsense get paid in Zimbabwe is anything from 50 cents per 1,000 pages viewed to about $5. Exactly how much depends on the quality of adverts that a publisher’s audience and news attract.
The biggest problem with these networks is that not so many local advertisers are advertising there. This makes most of the adverts shown to local audiences highly irrelevant which is problematic in two ways: (1) Irrelevant ads are more of a nuisance than ones from brands that have meaning to users- have you seen that one ad for Chinese mining equipment? (2) Irrelevant ads are less likely to be clicked on meaning limited revenue potential.
Examples of publishers using Adsense include:
Subscription is an emerging business model for news publishers in Zimbabwe. This follows the much-reported success that some big brand publishers in the US and Europe have had with the model – notable amoung them New York Times, Wall Street Journal, Financial Times and the Washington Post.
How this works is that the publisher asks readers for a monthly subscription fee to access content. Most publishers give a limited number of articles for free to each reader, say, 5. To read more pieces of content one has to pay.
In terms of software enabling this, the most popular is Memberful, but WordPress’s WooCommerce can also be used. The main drawback of these subscription systems is that they don’t provide for local payment methods such as EcoCash and Zipit. This can, however, be integrated by software developers using local payment gateways such as Paynow.
Even though subscription is an emerging model for publishers who are now increasingly considering it, there have been 2 publications that have based on this model in Zimbabwe for about a decade. The largest one is Zfn which has been sending daily newsletters to subscribers for a fee for more than a decade now. The other is FinEx which is also an email-based subscription newsletter and was started later by a former Zfn staffer around 2012.
In terms of news websites, there’s only one notable publication that has started to use this revenue model locally, which is the Financial Gazette. Another one, The Daily News (also an ANZ publication) ran on this model for about a year, before pulling it down.
A related but somewhat different type of subscription that’s noteworthy here is the ePaper type subscription. This has been tried by traditional newspapers and one that’s active at the moment is Zimpapers’ NewsHub as well as AMH e-papers that are being sent via email. How this works is that a scanned copy of the physical newspaper is made available online for a subscription fee. Sometimes you can buy the physical copy as an individual item in an online eCommerce shop like this one.
Like subscriptions, this is also an emerging business model in Zimbabwe and not much has been reported on the experience publishers have had with it.
The difference between subscriptions and donations is small – Subscriptions have a set price where donation driven sites ask for whatever amount a reader is happy to pay. They usually have a minimum though.
There are two notable publications trying this model – the first one is the relatively new site ZimLive.com. Another site is Zimeye.net.
It may be important to split hairs further here as well: The best way to understand the models being pursued by ZimLive and Sadza in the Morning is that this are more of patron sponsorships, that is fans supporting creators they love.
This is thus not donation in the charity sense of the word but rather a way for fans to express their appreciation for the value they derive from the publication. If done correctly this can be a powerful model for journalism focused news publishers as people become more aware of the need for true journalism in the era of fake news.
Even though these publications ask for donations, they shouldn’t be confused with the traditional donor-driven organisations which are typically NGOs.
These are publications that don’t ask of anything from their subscribers and also don’t employ any advertising on their websites. They are funded by international organisations such the DFID, the EU, HIVOS, the American Embassy and so on.
They are usually set up to meet a social impact-oriented objective. The people that set up these organizations, therefore, have to demonstrate to the donors through proposals that show how the project is helpful in meeting such impact objectives.
Examples of such publications include:
Of course the downside to this is that at times the objectives and incentives of the donor and those of the publisher do not align. When this happens choosing what to do will not be always obvious. Another problem is that developmental finance is cyclical. Donors move on to other more in vogue areas from time to time and may leave the publishing business high and dry.
You have seen these on almost every news publisher’s site. Named after decomposing fish matter used to bait large fish, Chumbox is the adverts of misleading story links presented as a grid or feed at the bottom of a news site’s main content.
They have been named Chum because they are low quality and many publishers only use them because they usually pay relatively better than advertising networks such as Adsense.
When a publisher uses them, readers will see links and crazy pictures with words such as “These 2017 cars are going for dirt cheap prices”, “You will not believe the house Chuck Norris lives in”, “You will be shocked what they found hidden in their yard” and so on. These days a lot of the links will include your location (because they would have tracked where you are) for example: This 16 year old from Zimbabwe is making $15,000 a day!
There used to be a somewhat healthy competition in the Chumbox provider industry but after the merger of Taboola and Outbrain, there’s really one large provider and then other much smaller ones.
You can read about them here to understand more how the ecosystem works.
Publications that use them include:
Public Relations as a publication’s business model is rarely on its own and never really a publicised part of the business. The PR side works as a side gig for the entrepreneurs running the publication enabling them to diversify their revenue streams. In the process, the line between what the publication publishes as news and what it pushes as PR, for whoever is paying, gets blurred.
For the avoidance of doubt, this is not necessarily Brown Envelope Journalism (BEJ), but the difference is so little we’ll lump it here together.
Fragmentation and aggregation attacks.
Come one, come all there is a lot of money at stake...