De Correspondent gets more transparent with members about its finances
There are benefits of getting revenue directly from audiences. But as Dutch subscription publisher De Correspondent is finding, that revenue comes with disclosure obligations.
De Correspondent this week started releasing more detail about its finances after its 60,000 members started requesting more transparency. For the past five years, the publisher has reported how it spends the money it makes from membership fees, which makes up three-quarters of its revenue. Now, it details all revenue sources, including book publishing, which makes up 14 percent, speaker engagements and article syndication, and how the money is being spent.
In 2017, De Correspondent made $4.5 million (€3.8 million). Readers were the source of 94 percent of its revenue through activities like membership fees, donations and book sales. Most of the readers are based in Holland and pay €70, or $82, a year.
“This was uncomfortable in the beginning,” said co-founder and CEO Ernst-Jan Pfauth. “We thought we share a lot of information — there are few publishers as transparent as us — but [members] push us and we do it. They feel like they funded this and now they want to know what we’re doing and making business decisions they agree with.”
De Correspondent launched with 10 founding principles — among them: to never sell ads, to be inclusive and collaborative, and to offer an alternative to the daily news grind. These principles and its member base impact the content it produces and its business model. Members take an active part in shaping the editorial product and journalists publish more details of their reporting. In a survey, it found that members don’t join for exclusive access but because they believe its journalism is needed, said Pfauth.
Such transparency with readers is a sign of the changes publishers have to make if they’re going to depend on their audience for direct payments. The publisher details its costs in a deliberately simple way as a retention tool, said Aron Pilhofer, who teaches journalism at Temple University and is a booster of De Correspondent. “Being this reliant on a single source of revenue is still risky, but it’s a risk worth taking for De Correspondent,” he said.
De Correspondent has enlisted a number of ambassadors ahead of its U.S. launch, including Wikipedia founder Jimmy Wales, FiveThirtyEight founder Nate Silver, Pilhofer and singer and socialist Rosanne Cash. How the ambassadors advocate for the publisher is up to them.
Putting up paywalls has attracted some criticism for catering to an elite few. De Correspondent seeks to have a diverse mix of readers. If a journalist is working on a story about police brutality, for example, the conversation editor might offer a free trial to people close to the experience, like victims or police officers.
For most publishers, the idea of community ends with comment moderation. For De Correspondent, the community is infused in the business model, the editorial strategy and the people they hire. This alignment makes it complicated for other news organizations to learn from them.
“It would take a massive shift away from how media organizations do business,” said Pilhofer. “Either they’re unaware or too afraid to risk what they are currently doing to explore these alternatives and do it seriously.”
Image: De Correspondent via Medium
Cheat Sheet: At IAB Podcast Upfront, diverse voices take center stage while podcast advertising revenue and audiences boom
Most of the companies that presented at the IAB Podcast Upfront signaled they had or were going to add more diversity to their programming, both in hosts and content.
Member ExclusiveMedia Briefing: What media companies’ latest earnings reports say about the state of the industry
Media companies' Q1 earnings reports signaled a continued return to business as usual — for better or worse, depending on the company's digital business.
‘Brands tend to be selective’: OMG report offers options to media buyers facing upfront inventory crunch
With a tight upfront TV marketplace expected, one agency group is recommending alternatives in video and CTV.
SponsoredHow The Company Store is reimagining customer experiences for pandemic-era growth
Throughout the pandemic, some retail categories have been inherently successful. Home furnishings and décor are among them; with consumers spending so much more time at home, updates and renovations flourished. Criteo data from the first half of 2020 showed sales for items like outdoor furniture sets up 434% year over year, with other home items […]
Cheat Sheet: Children’s privacy law update adds pressure against Facebook’s Instagram for kids plan
A day after states' attorneys general called for Facebook to end its kids' Instagram project, a congressional bill was introduced to strengthen the country's children's privacy law.
Bloomberg expands DE&I coverage with dedicated equality vertical
Bloomberg Equality will publish data-based projects tracking racial and gender issues as well as quarterly briefings and special sections in the publisher’s weekly magazine.