Our search issues seem on the mend after a lot of great work by Product. April saw a real nice turnaround on AT, continuing a sustained rise, while Kitchn also retained its bounce and looks on track to continue to rise in May.
Q2: Mission Critical - All Hands on Deck
A month ago we kicked off this quarter, and I asked every one of you move with urgency as we responded to a critical situation. You have done well, two of our Key Results are moving with speed, and our audiences have taken on a new momentum due to strong new content and fixes to our SEO problems that had deflated our search traffic. While I am tremendously excited for many things that are going on right now, I won't sugarcoat the reality that ad revenue, while slightly up from last year, has not responded yet and is still far below where we wanted it to be.
Being in the digital media business, we are dependent on sales of various shapes and sizes, from affiliate links to products from retailers like Amazon to custom campaigns with high-production videos like we're working on for our friends at Walmart. Without deep pockets or rich investors, we've always planned our revenue goals and then built our expenses to be below our goals - we always make more than we spend. Advertising is hard to control, so we are always very careful with our expenses in case our estimates are off. We always want a buffer. This is basic finance. It's simple, and it's how we built this business. And, over the years, our revenue has risen each year, as have our expenses behind them.
On a few occasions, our estimates for revenue were off, and this is one of those times. While we're up year over year, we had set our goals much higher. Part of this is us being slow to react and a bigger part of this is a very real ebb in the digital ad marketplace as many brands and agencies are pulling back on spending as they reevaluate their strategy for this new world in web advertising that we're in, the continued dominance of Facebook and Google in sucking up ad dollars, the growth of programmatic advertising, and - this is my own theory - a very real feeling of uncertainty in people's lives with regard to the political situation in our country, which is not making anyone feel richer or stronger, despite what anyone says.
Advertising ebbs and flows, and we are in an ebb. It will end. The goal right now - which is why it's very much Mission Critical -All Hands on Deck Quarter - it to stay the course, continue to adjust quickly and get through to the other side. We have to be extremely nimble with our spending over the next few months, up our game with every new RFP and client we respond to, and complete our search of a new Head of Sales in the next few weeks. This quarter is all about stabilizing and improving the way we position ourselves in the marketplace.
The next two quarters are about pushing sales upward again and continuing to diversify our revenue streams.
While we'll have to pull back on some plans, it is always good to drive hard into an ebb, show your confidence to your readers and clients, and plant the seeds that will blossom when the ebb turns into a flow. Particularly with advertising partners, you want them to remember your amazing work when they start spending again.
With hard work, focus and making more of what we already have, we will finish this year in a strong place.
Outside of our revenue departments, I don't want anyone to lose sight of the fact that the investments we've made over the past year, are paying off in spades.
- Video is on fire, with an award for their work and views at all time record highs.
- Our editorial/aud dev teams are also moving swiftly, growing our platform audiences to record numbers (AT Instagram just hit 1.5M followers and won a Webby award, competing against some of the best sites in the business), while our on site audiences are showing numbers for our new content that we haven't seen in a year. The quality of our writing, framing, titling and distribution strategy has moved to a new level.
- And our Product team is responsible for a lot of this success, as they've quickly and efficiently done massive cleanup on both sites, while working on the relaunch of both with version GEN as well as completing the rebuild of our Marketplace.
- Not to be left out, our Ops, HR and Finance have been working quietly, smoothly, and extremely efficiently in optimizing our back of house and helping us bring on some fantastic new talent. And with the official launch of Salesforce this past week, we have reached the next level in terms of sales and revenue tracking which we've been working so hard for for so long.
Bottom line, while we have real work to do in our revenue engine room, our ship, our product and what we share with our readers is in an incredible place, and we need to get this out clearly to our advertising partners so that they realize how valuable partnering with us can be.
Leadership expertise for this will come very soon. The list of potential Heads of Sales that we've met with over the past few weeks is impressive, and the experience level they represent is something our company has never seen.
Finally, I want to thank you all for reading through the Idea Book* and talk about the Leadership Principles at the beginning for a moment. While the whole book is important, the Leadership Principles boil the entire thing down to its essence in ten bullet points. The most important one for me lately is the principle of being Reader First.
This company started as a service company, helping people to lead better lives through their lives at home. To this end, our daily mission has always been to inspire, inform, instruct and share with our community so that they can see how much more is possible and create change in their own lives.
We are not entertainment. We lead our audience to action.
Particularly in times when it seems revenue is everything, it is important to remember this. Our ability to serve our community well is our eternal currency. It is our golden goose. As much as we must drive our sales, if we stop serving our audience well we will fail. We must always think of the reader's first. What do they need? What is the value we are providing to them? Are we solving their problems? Can we do more?
Strong sales is built on a strong relationship with our audience. As long as we maintain this, we will grow and prevail through any short term setback.
*I want to invite any and all of you who would like to talk about The Idea Book or have questions to a lunch and learn on Friday, May 18.
Comments have been disabled.