Cheap content scales for Demand Media

Demand Media publishes 4,000 articles and videos a day. It is a testament to the power of scale in the digital age and a test to the previous generation of content producers at operations like newspapers, magazines and TV stations that suddenly seem quaint.

A recent article in Wired magazine called the company “The Answer Factory” and detailed its formula for combining algorithms and cheap labor to produce an incredibly scalable – and profitable – content engine. A sample:

The process is automatic, random, and endless, a Stirling engine fueled by the world’s unceasing desire to know how to grow avocado trees from pits or how to throw an Atlanta Braves-themed birthday party. It is a database of human needs, and if you haven’t stumbled on a Demand video or article yet, you soon will. By next summer, according to founder and CEO Richard Rosenblatt, Demand will be publishing 1 million items a month, the equivalent of four English-language Wikipedias a year.

I saw Rosenblatt speak at an entrepreneurial conference at UCLA earlier this year. I was impressed by his “go big or go home” approach to web content. It flew in the face of common assumptions that dominate the newspaper and journalism conferences I had been frequenting. He wouldn’t accept the idea that advertising couldn’t pay for content. But, as the Wired article states, it’s a matter of driving the cost of producing the content down instead of the price charged for advertising up, which is what most other publishers focus on.

In an era overwhelmed by FlickrYouTubeWikipedia-BloggerFacebookTwitter-borne logorrhea, it’s hard to argue that the world needs another massive online content company. But what Demand has realized is that the Internet gets only half of the simplest economic formula right: It has the supply part down but ignores demand. Give a million monkeys a million WordPress accounts and you still might never get a seven-point tutorial on how to keep wasps away from a swimming pool. Yet that’s what people want to know.

Journalists first feared the algorithms behind Google News. But Demand’s operation takes “human replacement” to a whole new level.

That’s not to say there isn’t any room for humans in Demand’s process. They just aren’t worth very much. … The humans also couldn’t produce ideas at the scale of the algorithm. On a recent day, Demand Studios had nearly 62,000 freelance assignments ready to be filled; coming up with that many ideas takes more than a white board and a conference room jammed with editors. And to Demand, scale is essential. One outside search engine marketer estimates that Demand earns a mere 15 to 60 cents per ad clicked. It takes millions of clicks to build a real business out of that.

Can this work on a local – or hyerplocal – level? The 62,000 assignments available to Demand’s freelancers on a given day have to be broad in scope to attract the highest amount of ads. But the algorithms and formula do produce local insight: apparently Dallas is where the most people are looking for information on how to donate a car.

The lesson to be learned here is to not allow long-held assumptions about marketplaces to cloud your approaches. You can solve existing problems with new thinking. Just don’t frame the problem so tightly.

- Mark Briggs

Evan Williams: Committed to the vision, not the product

I’m a big fan of Stanford’s podcast series featuring entrepreneurial thought leaders. Lately, I’ve been catching up on the old (”classic”?) installments which is interesting because – if they are 3-4 years old – you know whether the projections for the future of a certain business or market played out as the entrepreneur predicted. Since he is going to be a keynote speaker at the Online News Association conference in October (I’m moderating a session on entrepreneurial journalism), I wanted to learn a little more about Evan Williams.

I discovered Williams, co-founder of Blogger and Twitter, completely missed on his projection of where podcasting was heading in this session from May 2006. But, interestingly, he was dead on with where digital communication was heading. Check out his answer to a question about the potential of his company  at the time, Odeo:

When I think about the path we are on now, enabling communication and personal expression, I think the biggest setback could be if it’s too hard to do. Which is one of the advantages of audio is that it can be really easy to do. I think people have an insatiable and ubiquitous desire for communication and personal expression. And the more ways that you enable that, as long as it’s easy, are going to be adopted in ways that we really can’t anticipate.

As far as the trend in general, I’m pretty confident. But as I said, I’m always hallucinogenically optimistic.

Take out the audio and it sounds like he’s describing Twitter. So it’s no surprise that, when the concept appeared on the company’s radar, Williams helped the company shift focus and dive in.

The challenge for any startup is determining what constitutes a viable new direction for your company, and which is a “shiny new object” that is not worth chasing. Focus, after all, is critical to success.

It also helps, of course, to be “hallucinogenically optimistic.”

New report: How to build a user community online

It doesn’t matter how how big your audience is. It doesn’t matter how cool your technology is. It doesn’t matter how clean your design is. Building a sustainable, vibrant community of users who contribute to your content operation is no easy task.

But it’s worth the investment.

Serra Media’s software helps solve the technical challenge of building a community, but we also want to share our experience and our research on the human side. So we’re releasing the Audience Mobilization Guide that we’ve been sharing with our partners to anyone interested in specific, actionable ideas for launching, promoting and maintaining a community of contributors online.

Thanks to Amy Rainey for her efforts on this report, and the great learnings of previous projects led by Rich Gordon at Northwestern University, Mark Potts at Backfence and Dan Pacheco and all the innovation leaders at the Californian in Bakersfield.

[Click here to download the report]

- Mark Briggs

Redesigned Gazette site focuses on breaking news, unique local content

The Gazette launched a new Web site this summer after redesigning and rebuilding its online presence from scratch. The new site is a vital step toward becoming a digital-first news operation. Rather than serve as an online version of the printed Cedar Rapids, Iowa, newspaper, GazetteOnline.com will be its own entity. The Gazette kept the same URL, but revamped the site’s branding and marketing.

The goal is to make GazetteOnline the best source for Eastern Iowans to “keep up with their ever-changing world,” wrote Brand Editor Jason Kristufek on NewsTribe.us, a blog chronicling the Gazette’s redesign. The redesigned site will offer updated content every 15 minutes during peak news times – 8 a.m. to 8 p.m. Monday through Friday – and use innovative tools to allow users to share, contribute and engage.

Content is king on the new site, and it will be a major factor that determines the site’s success. The site will provide people the immediate information they crave and a wealth of local knowledge and resources. Breaking news – weather, traffic and crime coverage, for example – has a prominent role on top of the home page. Live coverage, which is one of the fastest growing content areas, will also play a large role on the new site.

Additionally, GazetteOnline will focus on offering news and information that isn’t found anywhere else, such as photo galleries, videos, databases, archives, sports coverage and local news. The new GazetteOnline will provide contextual content experiences through links, aggregation, reverse syndication, user-generated items and other information that adds value to content. For example, GazetteOnline is using Block Talk, which is powered by Serra Media’s Newsgarden platform, to interact with users. Through the social-mapping platform, users can submit and share news, photos and videos.

Rather than use proprietary software, GazetteOnline opted to use the open-source Wordpress platform. Visually, the redesigned site offers its audience an improved user experience centered around news and information, and a streamlined navigation is a big part of that.

- Amy Rainey

Innovation occurs where productivity exists

If innovation were sold at a store, from a catalog or on the Web, it would be one of the most popular products in business. The fact is, innovation is difficult to define, to design and often difficult to divine.

Scott Berkun wrote “The Myths of Innovation” in 2007 to help people understand innovation by recognizing what it is not. Assumptions and stereotypes color the concept of innovation. There is a mystery to innovation that some people want to think of as magical. Others want innovation to be a mechanical process, something tangible that can be reliably repeated when necessary.

Done well, innovation produces something productive and substantive. But it has to be done every day, not just once in a lifetime. Everyday innovation, Berkun argues, is like solving a jigsaw puzzle. Each piece is important, but only by placing the last piece in place is the creation complete and visible. So the last piece becomes the story – the “epiphany” – while the previous 999 pieces were equally important but not as sensational.

Isaac Newton, for example, didn’t discover gravity by getting hit on the head with an apple, even though that’s the story that has been passed down through generations. Newton worked for 20 years to explain gravity, but a long arduous journey of intellectual curiosity isn’t as juicy as that apple.

“It’s entertaining more than truthful, turning the mystery of ideas into something innocent, obvious and comfortable,” Berkun wrote. “Instead of hard work, personal risk, and sacrifice, the myth suggests that great ideas come to people who are lucky enough to be in the right place at the right time. The catalyst of the story isn’t even a person: it’s the sad, nameless, suicidal apple.”

Innovation happens because an individual or an organization is willing to try lots of ideas. It can be reduced to a simple equation: The more productive you are, the more ideas you can try and the faster you’ll find that idea that works.

In order to get going, though, individuals and organizations must adapt to a world where change is constant. Welcome to the new “normal,” where you must expect tomorrow to bring different challenges than today.

If you apply Darwin’s theory of evolution to innovation and leadership, you understand that it’s not necessarily the strongest or the smartest that survive. It’s the organism (or individual or organization) that can adapt that will survive.

After all, change is inevitable but progress is optional.