Digital publishing can look like an ecosystem where only the biggest can survive. But not everybody is doggedly chasing scale. In fact, some are even aspiring to be midsize: Just this week, Verge co-founder Joshua Topolsky announced he was creating The Outline, a new site designed to reach an audience of 10 million to 15 million, according to The Wall Street Journal. With that in mind, we’re taking a look at a few digital publishers that have managed to thrive by embracing the middle. First up: Breaking Media.

While a consumer-facing website can set its sights on 100 million people, most B2B sites can’t target a tenth that many.

Breaking Media has managed to target those groups and still turn a profit. The nearly 10-year-old company co-founded by Justin Smith, who is now Bloomberg Media’s CEO; and Carter Burden III operates seven sites aimed at people who work in law, fashion, finance, medical, defense, energy and government, and it’s managed to be profitable and grow steadily. By building a diversified stream of revenues, Breaking has grown revenue 25-30 percent in each of the past five years, despite being mostly self-funded, according to its CEO, John Lerner.

Lerner, a veteran of niche publishers F+W Media and Nielsen Business Media, has served as CEO for the past six years. He was also one of Breaking’s initial investors, along with Smith and Burden. While he jokes that he took the job of CEO partly to protect his investment, he said he was drawn to the job because of its engaged readership.

“I hadn’t seen engagement in the B2B world like that before,” he said. “We weren’t monetizing it well, but the readership is the hard part.”

The Breaking portfolio, which employs about 40 people, publishes between 70 and 80 articles per day, according to Lerner. The biggest site is Fashionista, which had just under 1 million unique visitors in June, according to comScore. Breaking Media, like many sites, disputes comScore’s numbers as “wrong” for small sites like Breaking Media’s. Lerner pegs Fashionista’s audience at 2.5 million, using server stats, and the portfolio of sites reaching 5 million.*

Outside consumer-focused Fashionista, the rest of its sites are understandably small, as they’re drawn from a very limited pool of possible readers. For example, Lerner says that he considers the potential audience for Above the Law to be the 1.3 million registered lawyers in the United States; it reached about 270,000 people in June, per comScore. (Breaking Media claims an audience of 1.1 million for Above the Law, using Google Analytics.)

There are advantages to serving such a small professional group. They are older, affluent and often visit the sites while at work on their desktops, which generally command higher ad rates than mobile. They also belong to specific professional groups that a publisher can super-serve.

“Serving a specific community, or even over-serving them, then figuring out how to give them things that will create a profit margin, is the one thing that’s consistently successful in media,” said Dorian Benkoil, founder of publishing consulting firm Teeming Media.

That’s what Breaking has striven to do. While most of the revenue comes from direct advertising, custom and native ads are close behind, supplying 35 percent. Events bring in another 15 percent, and up to 10 percent comes from other streams including e-commerce (the company sees affiliate sales from Fashionista) and content licensing.

Breaking hasn’t chased programmatic ad revenue as bigger consumer sites have; his audience isn’t that big, and the CPMs aren’t that high.

That limited audience size creates both challenges and opportunities for a publisher like Breaking. The site routinely polls its readers on topics related to their fields, parlaying that audience research into native ad opportunities for advertisers including Thomson Reuters and legal recruiter Kinney Recruiting. “When 10,000 lawyers respond to a questionnaire, that’s tremendous,” Lerner said, referring to polls regularly conducted on Above the Law.

But as nice as it is to super-serve one audience, there’s no reason not to try and acquire more of them. Since Lerner came aboard, Breaking has added sites including MedCity News, and he plans to add at least another vertical every two years. Last spring, the company raised $1.5 million to help fund that expansion.

Lerner says he looks to keep that pace because it takes about that long to get a new site, whether it’s built from scratch or acquired, fully up and running. But he doesn’t mind moving at a steady pace. “We’ve stayed the course,” he said

* Many publishers, particularly small publishers, object to the use of panel-based measurement from ComScore, which has long served as the industry benchmark by agencies in assessing sites. The downside of server numbers, as measured by Google Analytics, is they count bot traffic, as well as people visiting sites from multiple computers and multiple devices. This post has been updated to include Breaking Media’s server numbers.

Image: Fashionista

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