'Patch' Points Way To Profit From Local News

  • by March 3, 2020
Patch Media, the publisher of more than 1,200 hyper-local news sites, is a comparable bright spot among publishers of local news; it's having been profitable for the past four years.

As other providers of local news seek ways to build a sustainable business as ad revenue and circulation dwindle, Patch has developed a template that helps to identify markets ripe for a local site.

“We have much better data and analytics than we had in the past," Warren St. John, president-director of the company, said in an interview. "We've also tried more experiments and learned from them.”

He declined to provide revenue and profit figures for the company, which is privately held. The company's sales come from a combination of programmatic advertising, agency sales and direct sales to advertisers.

Patch grew its email list by 40% and doubled its event listing revenue last year, St. John said. Patch sees an average transaction size of $49 for its event listings that urge viral sharing to broaden their reach. Its collection of sites has a total of 32 million monthly users, while its email newsletters reach 2 million every morning.



In identifying communities for a localized news website, the company looks for a population of at least 30,000 people that can sustain an ongoing business. Because it has the back-end technology in place, it doesn't need to reinvent the wheel every time it creates a new community site.

For example, its local news site in Joliet, Illinois, generates the most traffic, St. John said. Joliet has a population of about 150,000 people, making it one of the biggest cities in Illinois, located 30 miles outside of Chicago.

That combination of population size and geographic location outside a major city puts Joliet in a sweet spot for Patch's business model.

Patch last year hired Alison Bernstein, a longtime veteran of wedding site TheKnot, as its new CEO, while St. John transitioned into his current job as president.

TheKnot had an interesting history of evolving from an editorial-focused website that sold ad space into an online marketplace for vendors of wedding services. That experience helps to inform a strategy for Patch to generate sources of revenue outside of advertising.

Unlike sites that have independent contractors and freelancers providing editorial content, Patch employs editors and reporters full-time to maintain the consistency of its coverage, St. John said.

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