In a brutal media environment, Evolve Media cuts staff
Evolve Media laid off eight senior executives in its publishing divisions last week as the company figures out how to keep up with the shift to quality content and a platform-dominated ad market.
Those let go included top people over centralized departments like design and marketing. The publisher of Mandatory (formerly CraveOnline), a bro-heavy content site for young men; and TotallyHer, a collection of lifestyle sites including Momtastic, Total Beauty and Dogtime; also let go editors-in-chief, consolidating leadership of its sites with a few top editors. The company has also cut salaries of certain top executives, and some of the recently departed said that the company paid little to no severance. (Evolve said severance paid depended on time served.) All in, the company is down to 150 full-time employees from more than 400 three years ago.
Evolve’s co-founders, Aaron Broder and Brian Fitzgerald, said the company took some revenue hits as advertisers have shifted their spending into programmatic avenues, which Evolve has never chased because the ad rates are lower than direct-sold ads, and as more of the ad pie goes to Facebook and Google.
Evolve has seen audience declines. Its men’s sites (classified by comScore as CraveOnline) collectively had 16 million monthly uniques in April, down from 17.8 million a year earlier, but individually, most of the men’s sites have less than a million uniques. TotallyHer’s monthly uniques were 23 million in April, down from 31 million a year earlier; the individual sites tend to reach under 2 million a month. (Figures are from comScore.)
Broder said the company is on track to be profitable again this year after losing money the past few years, helped by the staff cuts and a greater push into content marketing. He also said the company is “exploring reader-pay models,” emphasizing content by putting savings from laid-off editors-in-chief toward hiring more staff writers, and planning to prune the number of sites it represents.
“There’s a 100 percent flight to quality and programmatic,” he said. “But the notion that people don’t want to consume content on sites they’re passionate about is a fallacy. Our sites are, if not stable, growing over time. There’s a place in media for affinity-based sites.”
In web terms, Evolve is an old-timer. It was founded in 2000 as Gorilla Nation, an ad network. For years, it scooped up sites like TotalBeauty.com and AfterEllen.com at reduced prices and sold advertising across the dozen or so sites it owns, combined with other, long-tail lifestyle sites it represents. The company reportedly made up to $100 million in revenue that way along with mobile marketing company Apex Mobile Media and Martini Media, an affluent online ad network that Evolve bought in 2015.
“There are two concurrent flights — the flight to quality and audience data,” said Ben Kunz, evp of marketing and content at Mediassociates. “The challenge with these long-tail, aggregated networks is they kind of get stuck in the middle. It’s a weak position to be in.”
Publishers are starting to take a less-is-more approach to output. Evolve’s sites, meanwhile, are crammed with quick lifestyle and entertainment hits. Some of the sites produce as many as 600 to 800 pieces of content a month, mostly text- and photo-based, Broder said.
Broder wouldn’t say how many edit staffers Evolve has to produce all that content, though. Despite that high output, Broder said the sites have maintained high quality and serve their audiences, noting that the men’s sites have 50 million user sessions a month (“a crap load of user sessions”) without having to buy traffic as other digital publishers do to fulfill advertisers’ campaign requirements.
“None of the sites are The New York Times — it’s against passions; they’re gaming reviews,” Broder said. “You will see tons of content, and the content’s quality.”
The areas that Evolve is betting on for growth are already crowded and difficult. Almost every publisher has a branded content studio, and the nature of the work makes it hard to make decent profit margins. Getting readers to pay for online content is hard enough for established news organizations, to say nothing of lifestyle publishers. (Broder admitted that reader revenue “hasn’t worked out for most in the lifestyle space,” but insisted Evolve has “affinity in that space.”)
Being independent, Evolve also has less room for error. Evolve took funding for five years from Great Hill Partners, a private equity firm, but since 2012, it’s been self-funded by its co-founders and a few other individual investors. One way it’s found savings is by shifting some back-office functions like tech, design and finance to Mexico, where labor is cheaper.
Fitzgerald, who casts himself as a survivor as an independent operator, said being self-funded and without a board and big outside investors also enables Evolve to act faster to changing market conditions, in contrast to venture capital-backed media companies like Mashable and Mic that scaled to big heights on Facebook, only to fall when Facebook stopped sending them loads of traffic.
“I do think we are unique in our proactiveness, our determination to critically self-assess and make changes to adapt to the market in a nimble manner,” he said. “Unlike other companies, where management may only own a small piece of the business and that ownership piece is buried under large investor preferences on liquidation, we own this business and stand to gain or lose everything from its success or failure.”
More in Media
Publishers are unsure if blocking AI web crawlers is enough to protect their content from being scraped and used to feed AI tools and systems.
New features include a new chatbot called MetaAI, Bing search integration, new AI image tools, and dozens of celebrity characters.
The Financial Times has launched another lower-priced, subscription-based mobile app product a year after the debut of FT Edit to reach international readers.