A year ago, Open Coffee Louisville was born from a twitter conversation that happened during Brad Feld’s nigh-historic presentation at the Kentucky Center in October 2012.
Feld spoke about creating community within the entrepreneurship and tech circles in a city, and he gave his four-part “Boulder Thesis,” the keys that make Boulder, Co.’s entrepreneurial community famously cohesive.
The fourth part:
The start-up and entrepreneurial community needs to have a steady stream of events that engage people. “Boulder has a series of meaningful events that engage everyone in the ‘stack’ – not just awards or parties but accelerators,” says Feld. Feld also spent a great deal of time praising events like Startup Weekends, which offer a compressed period of time in which to investigate entrepreneurship. “Cocktail parties? They’re nice… But not that useful,” says Feld. “You need focused events like Startup Weekend, startup accelerators… Open Coffee.”
The Monday following the Feld event, the first Open Coffee happened thanks to people like Alex Frommeyer, Kelby Price, Chris Vermillion, Greg Langon and Patrick Goodman and the folks at Insider Louisville. It was held in the Insider Louisville World Headquarters and attracted around twenty-five people.
And we have met nearly every Monday since. More than 150 people have attended an Open Coffee event. Today we had 32 people, with a number of new faces in the crowd.
Insider Louisville’s CEO Tom Cottingham was in on the conversation that gave birth to the first Open Coffee, so it seemed apt that he would lead the anniversary Open Coffee.
Cottingham gave us an overview of the digital media and advertising landscape and a bit of a history of how so much news came to be consumed online.
In the 1980s Cottingham got involved in publishing and IT. The IBM personal computer had just been shipped and people were writing about software.
There was a guy, Cottingham said, named Steve Case who was begging people to invest in a product called Quantum (Q-Link), a bulletin board program for the Commodore 64. But people didn’t recognize the value; it was an idea ahead of its time.
By 1994, he had changed the name and services a little, and AOL had a million subscribers.
When AOL took over Time Warner, it was a $164 billion acquisition and was one of the major events in modern media. Then the dot com bust happened.
Fast forward to today, and the two companies have separated and each have a market cap that is a fraction of what it was back in the 00’s.
Back in 1980, there were 220 million people in the US. 22 percent of the population watched network news. 60 Minutes was the number one program on television.
Today there are 320 million people in the US, and only seven percent watch network news. NCIS was the number one program on television during the 2012-13 season (who watches this show? I don’t know anyone who does!).
That’s the big challenge, says Cottingham. Broadcast media has changed dramatically along with the economics of media. Everyone is moving online; the trends are pretty clear.
About 22 percent of Americans live in a home where English isn’t the primary language spoken. (This is 8 percent in Louisville Metro).
About 22 percent of the American population is 18 or younger (24 percent in Louisville Metro).
About 17 percent of the American population is over 65 years old. That’s who’s watching network news. (12 percent in Louisville Metro)
All stats are from the 2010 census figures.
According to Cottingham, 256 million people have access to the Internet, and even though people are moving their news consumption from print/broadcast to the Internet, ad rates for digital advertising are a fraction of of what they are for print or broadcast.
Half of the money spent on digital advertising goes to search. That’s a huge chunk of ad dollars that is no longer going to publishers but to Google and other search engines.
In Louisville, Cottingham says that somewhere between $50-150 million were spent online by local advertisers on local advertising. Cut that figure in half because of the percentage spent on search engines and there is $25-75 million in ad revenue up for grabs in Louisville. It’s expected this number will grow 4-6 percent yearly.
“That’s a really huge number,” says Cottingham. “And one I don’t actually believe.”
But one of the biggest hurdles digital media is facing when it comes to ad sales is that for a decade, local print, broadcast and radio have basically given away online ads. If you bought a TV, newspaper or radio ad, an ad on that media’s corresponding website was usually free or cost a pittance. If you’re a media buyer, you’ve been trained for a decade on that principle, so you’re reluctant to pay substantial money for online advertising space.
Broadcast news is around 22 minutes long and more than half that time is spent on weather, sports and traffic because they’re all very visual. Lately weather has been overtaking sports in many markets.
“Unless you’re a broadcaster,” Cottingham says, “you have to be a narrowcaster. You’re not going to be defined by your content but by your audience.”
Insider Louisville gets a huge amount of traffic from Facebook and a lot of traffic from Twitter. “Millennials don’t trust advertising or slogans,” says Cottingham. “They trust their friends.” They often don’t believe in a brand’s promises until they see a friend endorse it. So the “share” and “like” features on social media are key to building the Insider Louisville brand.
Cottingham says, “The people who friend us on Facebook are our brand.”
If you’re in local media, you have to be very high-touch. One of the reasons AOL’s Patch failed (AOL’s attempt at doing local media on a national scale) was that they didn’t have enough feet on the ground.
Cottingham says, “You have to live here. You have to have their trust. You have to let them know that you’re not going away.”
Why was the Courier-Journal in the Bingham years so successful? Because they were here. They cared about the community. And they invested in Louisville.
Chris Poynter, the spokesman for Mayor Greg Fischer asked, “How do you make money?”
In digital media that’s the million dollar question, isn’t it? Cottingham’s response: We’re leveraging trust and holding people accountable. How do you leverage that trust? You leverage the relationship. And sometimes that means native or sponsored content. Companies are spending huge amounts of money on the creation of sponsored content.
Chris Poynter noted that Bill Samuels targeted a reporter for the Wall Street Journal until finally the WSJ wrote a front page article about Makers Mark, an article which catapulted the brand.
Nick Roberts, photographer, said the content he creates for his blog has driven a lot of sales to his site. He said, “I have tried to write interesting stories that speak to the very things that my audience wants. It has to be pertinent to the people who are reading it. It has to be fresh. And then they’ll assume you’re the authority and help support you.”
Another part of our high-touch efforts have been through events like Open Coffee and Insiders Meetups. There was some conversation about comments sections and how for the most part they’ve fallen a bit out of favor. Terry Boyd said we’ve tried to cultivate community and conversation during the Meetups — in person better conversations can occur and people are often more civil.
Kelby Price also brought up the fact that Insider Louisville tends to be very “boots on the ground” as far as reporting goes. “You’re not in the back of the room taking notes.”
There was a bit of conversation about the dearth of investigative journalism and whether or not investigative journalism should be considered a public good? Public Media just raised a lot of money from private donors and funds to create a Kentucky Center for Investigative Reporting. Is there no other model for this very expensive and time consuming type of journalism?
Poynter began his career in news media, and he says his transition to the city side of things has made him think: “I believe you need a strong media even more.”
Cottingham said, “If you went to the city and asked what the city’s media strategy is, you won’t get a clear media message.” Chris Poynter nodded and seemed to agree.
“You have got to have an informed city to have a decent city,” said Cottingham. He said a recent analyst, Meredith Whitney, proposed that some of the greatest growth in the US will come from the center of the country. In her analysis, Louisville is right on the edge of the region that will see a boom. It could either be in the circle of growth or out. Cottingham thinks part of the difference between being in or out of the circle depends on the quality of media in Louisville in the years to come.
Announcements (we ran late, so there were few).
XLerate Health will have its demo day on Oct. 30 at 4 p.m. at the “Atomic Cupcake Building,” according to Greg Langdon. (That’s the Nucleus Building, for those of you not familiar with the images on the decorative friezes on the building. There is indeed the symbol of atomic energy, but there is also an image of a bushel of apples meant to represent the agricultural sciences that does, indeed look an awful lot like a cupcake.) More on Demo Day here.
Next Open Coffee, Greg Langdon will moderate and Kenny Marcum will talk SEO. Mon., Nov. 4 at iHub on S. Floyd Street. Thank you to iHub for hosting and Heine Brothers for a great start to a week.