Local News Now to Boost Sales by 25% With Fresh Take on Ads and More
By: Christiana Sciaudone
Classifieds are back. Sort of.
Local News Now, which owns three websites devoted to Washington, DC-area neighborhoods, expects revenue to jump by some 25% in 2025, in part driven by a new automated platform for advertising.
The Content Hub, an in-house product launched in August 2022, provides a do-it-yourself platform for classified-like announcements, events, homes for sale and job listings at $99. Revenue from the Content Hub will reach the mid-$100,000s by the end of 2024, after hitting $100,000 for the first time earlier in the year. That’s with almost no marketing besides putting links at the end of emails and announcements for people to submit their own.
Local News Now, which has always been digital-only, should hit about $1.6 million in revenue for 2024, which founder Scott Brodbeck foresees jumping to $2 million next year. He’s also expecting margins to improve from high single-digits to between 10% and 20% as the newsroom automates additional functions and even more new revenue sources are added.
Brodbeck wants to build Local News Now into a solid company before expanding to new regions and bringing back local journalism in a sustainable and digital-only way. The most enduring media companies are family-controlled, and that’s the best future for LNN, the founder told A Media Operator.
“What would be the most rewarding and meaningful outcome to me here, it’s not selling and having an exit. It’s being able to create an enduring, family-owned media company that operates at a significant scale,” Brodbeck said.
Last month, Local News Now bought out competitor the GazetteLeader from O’Rourke Media Group, eliminating the print edition. Brodbeck kept two experienced journalists from the purchase, putting the LNN newsroom at nine, with three people covering each county they serve: Arlington, Alexandria, and Fairfax.
“Selling the GazetteLeader to ARLnow is a strategic move on our end that just made total sense given the 15-year established digital presence of ARLnow. Trying to resuscitate the print publication while establishing a digital audience was just too costly for us to continue,” Jim O’Rourke, chief executive officer of O’Rourke Media Group, said in a statement.
Brodbeck hadn’t been looking to make an acquisition, but was approached with an attractive offer that was “well within our means.” He really bought it for the two journalists he then hired to fulfill his dream of a fully built-out editorial team that can bolster local government and community coverage.
How They Got Here
Brodbeck founded LNN in 2010 after stints at traditional broadcasters where his pitches to do more work on the web were declined. He was in business school and had absolutely no plan or strategy whatsoever. The one paper in the community of Arlington (which turned into the GazetteLeader, which he just bought) was a weekly that seemed to cater to a readership of homeowners above the age of 65. He did not see himself in the publication.
“I launched it with no business plan whatsoever, kind of a hunch that maybe there was some demand here,” Brodbeck said. “I like, literally, had no idea what I was going to sell. I’m just like, I’m going to go out there and start reporting. And sure enough, it found an audience, and in online media, the number one thing you need is the audience. And we had it, and so I was able to build off that.”
He said he also has executed well on the business side, constantly adapting offerings to market demand.
It hasn’t all gone smoothly, though. In the mid-2010s, Brodbeck attempted to expand in Bethesda and DC, only to find there was too much competition and residual demand for print from local businesses. He’s still paying the low-interest, friendly loans he took out for that failed investment.
He’s also seeing firsthand the difficulty in bringing print advertisers over to digital. Many small businesses are inert, uncertain about the shift to online, which Brodbeck said is understandable.
So LNN, which has a total of 12 employees, offers help with digital ads, including with design, and has an expertise it can use to advise clients on crafting campaigns.
Show me the Money
About 65% of revenue comes from direct ad sales, and programmatic makes up 20% of sales. Direct ad sales have been flat, and programmatic has dipped slightly.
Rounding out sales is the Content Hub, which came about as Brodbeck sat for months recovering from back surgery with way too much time to while away. So he taught himself to use Zapier and Airtable and other automation tools and figured out that they could push events through WordPress and thus a new business model was born.
Aaron Seyedian has advertised on LNN’s properties since 2017 for his company, Well-Paid Maids.
“What Scott’s done that’s really great is just make it really easy to buy ads and also price them in such a way that respects the fact that it’s not totally automated but it’s a somewhat automated self service tool,” Seyedian said in a phone interview. “Because of that, they can offer it at a lower price point.”
Before LNN moved to the Content Hub, Seyedian was paying $449 per sponsored post per week on just one website, a total of $23,348 per year. He now pays $376 weekly for a total of $19,552 a year to advertise on four properties.
“Everyone is a winner here in that Scott kept my business for a small discount, and I plan to do this in perpetuity since the value is fantastic, and I am saving ~$5k over what I was paying + getting 4x the value,” Seyedian said.
Artificial Intelligence That Works
LNN has leaned big into automation, beyond the Content Hub, using AI to generate social media posts and sales and marketing functions.
“Last I tallied it up, we were saving at least two full-time positions in terms of the work being done on automations on a daily basis,” Brodbeck said.
That’s helped profit margins, with much of the proceeds getting reinvested into the company. Profit margins have dropped amid a tougher scenario for advertising, and Brodbeck is focused on pumping it back up in 2025. LNN will start the year at breakeven, with monthly revenue meeting monthly costs. Additions like new ads from the acquisition of GazetteLeader, the ability to host public notices after a recent change in legislation, outreach to bigger advertisers, and real estate lead gen should help boost the bottom line.
Aside from the debt taken on for the ill-fated expansion attempts, which totaled a couple hundred thousand dollars, LNN hasn’t taken on investment capital.
“The reason we’re still here and kicking almost 15 years after the founding is because we’ve been able to forge our own path and run lean on profitability when we need to, and make long-term decisions rather than short-term decisions, and not chase every shiny object out there,” he said.
Growth of the company has been similarly measured, between 5% and 15% annually. Brodbeck’s hope is to establish strong operations in existing properties and then expand elsewhere, though he’s not at all sure what that might look like or how long it might take.
“When we’re legitimately in a position where we can expand and bring this model elsewhere so that other communities can have local news sites with three full-time journalists and great client service for local advertisers that need to reach local customers, when the time comes, I want to pursue it aggressively,” Brodbeck said. “This is like the tortoise and hare thing to an extent. We’re the tortoise right now, and at some point we’ll become the hare.”
