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Playing to Our Strengths

Vox Media Chairman & CEO Jim Bankoff on an era where quality, scale and sustainability matter more than ever.

This morning, Chairman & CEO Jim Bankoff shared thoughts on the state of the industry and our company with Vox Media staff.

Hi team,

I’ve had a lot of good questions lately about developments in our industry and what they mean for us, particularly around Facebook’s flurry of recent announcements as well as the reports of other companies facing financial turbulence. I wanted to take a moment to share some of my thoughts on the state of our business, where we’re headed, and how we will keep our growing, thriving company a success.

First, a recap. Over the past several years, our company has emerged as a leader in a cluttered media environment by successfully aligning two objectives: quality and scale.

Many companies in our space have pursued scale without quality. Their growth tactics have evolved from content farms and SEO or social feed gaming, to slideshows and three-second captioned Facebook views. Likewise, digital advertising has seen the demise of large ad networks that were built on pushing lousy formats in as many places as possible over brand building and performance. Of course, quality applies to how we seek to grow our culture too. We’ve seen too often how workplace cultures that scale without the right values lead to toxic environments.

Quality without scale often yields some amazing work, but generally doesn’t support the sustained breadth and depth of rich programming, strong journalism and product innovation that we seek to achieve. In the advertising business, scale is essential to merit the sustained commitment of marketers who need to reach audiences. Scale also enables diverse business models such as our fast growing TV and live events businesses. Even the biggest media conglomerates are bulking up as is evidenced with the recent slew of mega-mergers.

Quality at scale is a hard thing to accomplish, but we have. We are the leading programmers for a new generation of consumer, building brands that serve audiences and marketers across all relevant media types and platforms. Our unique approach to building big, trusted multi-media networks in major categories on a united monetization and product technology platform allows us to grow deep where others have faltered by scaling shallow. Our results prove this out. Per Comscore, our owned and operated domestic audience is larger than any other content company that has started in the past decade, considerably bigger than any of our modern media peers, with a bullet. All of Vox Media’s properties grew their audiences by double-digits year-over-year off big bases: SB Nation (+31%), The Verge (+86%), Polygon (+61%), Vox (+21%), Eater (+26%), Racked (+42%), Curbed (+42%), and Recode (+33%).

Our growth has occurred on our websites and across many media platforms we count as partners. We are not dependent on any particular partner, including Facebook. As I mentioned in our all-hands in December, well before their announcement about algorithm changes, we had already made a decision to scale back our native programming on Facebook.

Facebook has obviously changed the way billions of people around the world connect and share. However, even though the company has made efforts in the right direction, they still need to become a more reliable programming platform. A programming platform allows for brand loyal audiences to be built. Content in the Facebook newsfeed is generally consumed through serendipity, not intent, making it less natural to grow loyal audiences to any given media brand. A programming platform also enables rich and predictable ways to make money to support quality journalism and storytelling. As of now, Facebook does not offer a viable path to monetize our in-depth video work.

The Facebook newsfeed is, however, an important promotional platform for programmers upon which to be discovered. While it’s unpredictable, we are optimistic that changes to the feed algorithm which will favor both trusted and local journalism will mean that even more people will be exposed to our work. While we will cut back our native video programming on Facebook, it will remain an important promotional platform for us. We will continue to expose our quality programming to hundreds of millions of people who enjoy it, share it and who may ultimately become engaged consumers of it elsewhere: on a website, in a newsletter, through a podcast, on a TV or OTT network, Facebook Watch, a YouTube channel or one of the other platforms upon which we program.

This construct of understanding the difference between true programming platforms and promotional platforms will be an important part of how we work with partners, serve audiences and make investment decisions going forward. Our partner platform priorities will continue to evolve. While we’ll do less native video programming on Facebook, we’ll do more on OTT and linear networks. As a matter of fact, in the past 90 days we’ve announced partnerships to extend our brands and storytelling onto major programming platforms like Netflix, PBS and MSNBC, with more to be announced shortly. Of course, our written word, visual and audio storytelling continues to achieve outstanding impact and growth as well, and the editorial strength of these products drives even more interest in from TV distributors.

Betting on the right platforms and initiatives, and adjusting course where necessary along the way, has allowed us to not only grow in a quality way, but in a financially sustainable way too. As I mentioned in our all-hands, because of our decisions and strong execution, we achieved our financial goals in 2017 while others around fared less well on a rocky landscape.

In 2018, we will get even more disciplined about maintaining a course of financial growth and strength. This means there will be places that we’ll invest more and places where we’ll need to scale back. We will grow our organization, but not at the same pace as we have over the last few years. We’ll need to make smart choices on an ongoing basis about how to apply our resources. We will invest even more deeply in our SB Nation team brands, in growing our podcast and television efforts, in adding muscle to our revenue organization, and in continuing to develop the infrastructure of our organization by adding office space and more IT, comms, legal, finance, and people and culture support.

In order to put time and resources into the projects that most help us to deliver on the mission and goals of our organization, we’ll need to focus on the opportunities we have that are working, lean into them, and make tough decisions about how to re-prioritize the projects that are not as productive. Decisions to move on from initiatives that have less potential in an ever-changing environment are difficult. As I said in December, this work is hard, but it is worth it.

The really good news is that we’re entering an era where quality, scale and sustainability matter more than ever. Fake news and fake views are out. Trust, engaged communities, authentic voices and financial discipline are in. This all plays to our strengths. The work that you do matters more than ever and there isn’t a better place to do it. I couldn’t be more proud of that work and great company we are building together. Thank you for all you do.

Onward,

Jim