The Awl, The Hairpin, and the struggle of Digital Media Publications

Culture news site The Awl announced yesterday that it would be ceasing editorial operations, a little less than nine years after the site launched back in 2009. In addition to closing the flagship publication, the network (which also includes sites Splitsider and The Billfold) announced that it would be shutting down its female-focused site The Hairpin.

In an interview with the Wall Street Journal, Awl publisher Michael Macher cited a lack of direct advertising deals as a contributing factor, noting that the market for such deals with a semi-niche publication like The Awl is limited.

It’s a crunch that a number of digital media publications are facing as advertising buyers abandon direct deals with smaller, niche publications, instead favoring the algorithmic options offered by third-party programmatic advertisers like Google. As a result, a number of smaller publications find themselves less financially viable, as their advertising revenues are gradually siphoned.

As Facebook and Google increasingly devour the advertising marketplace (Google made over 27.7 billion last quarter), publications face a choice: expand or die.

Such was the choice facing Awl, according to the WSJ interview with Macher. The publication could increase the size of its editorial team in an effort to expand the site’s readership, or it could fade.

The Awl chose the latter.

For sites like The Hairpin or Gawker Media’s former array of publications, for example, their market advantage was in their specificity. Niche publications serve a niche audience, who advertisers can then target with direct ad buys.

But with algorithms rapidly improving, advertisers are now better served by doing direct deals with larger publications. Buzzfeed, for example, has found a fair amount of success with its sponsored content deals. Yet even for them, the dominance of Facebook and Google in driving both clicks and advertising to the site has proved highly volatile for their bottom line. With every algorithm change by Facebook, Buzzfeed and similarly social media driven sites like Vice and even The Washington Post, must reconfigure their social media strategy in order to maintain their revenue projections.

As Macher noted, The Awl will likely not be the only publication that is hurt by this trend. As advertisers leave the indie publication space, the influence of Google and Facebook will likely only become more apparent.

A test for their influence likely to come soon — Facebook recently announced an algorithm change, sparking questions for online media producers emerges: will it be the apocalypse or just another growing pain?

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