Sometimes not getting knocked down is a win for affiliate marketing.
Written by Brook Schaaf
“In 2023, [there have been] 20,000 job cuts … on top of 30,000 during the Covid era and it’s not stopping,” said Jason Calacanis on Friday’s All-In Podcast. Examples of layoffs, bankruptcies, and shutdowns from the past year include the L.A. Times, BuzzFeed News, Condé Nast, Business Insider, Vice, Jezebel, and Sports Illustrated.
Whether one is included to bewail, protest, or even jeer, this may reflect an unavoidable economic reality. As the narrative goes, Craigslist destroyed the classifieds cash cow, then subscription revenue dropped, then CPM revenue couldn’t be matched online for offline. This led to more and more clickbait. Per All-In’s David Friedberg, “To compete, traditional media has largely had to create sensationalist approaches … that drive an emotional reaction … in order to keep people’s attention and to drive clicks. Over time the media businesses have lost the trust and faith of the viewership and the readership because they see how much of this is biased and opinionated.”
Is this true? Polling seems to reflect it. If it is true, does it make a difference? I don’t know. People can only consume so much media. In this respect all outlets compete with each other to some extent — social media, TV, podcasts, streaming apps, YouTube, books, etc. — even live events. I think it was Netflix exec Reed Hastings who said his main competitor was sleep. In this superfluous environment, the pull toward sensationalism may feel inexorable.
However sensational the content is, it must first be produced. By Calacanis’s back-of-the-envelope math, a journalist might earn $100k per year while the company’s total investment per journalist is multiplied by three (overhead, salespeople, managers, etc.). At a $300k investment, if that journalist averages two stories weekly, each story costs the company about $1k at $10 CPM or RPM. “… That means every story to break even in today’s market would need 100,000-150,000 people to read it … obviously that’s not happening.”
“If you were to put that same journalist on a subscriber platform, that means they got to get like 15-20 subscribers per story for a year to hit just their salary. So the economics are just hugely broken except for subscription businesses.”
It seems to me he might have added the third tentpole, affiliate commerce content, if not coupon pages. While this is admittedly anecdotal, I have heard of no layoffs in our space, not at Affiliate Summit West, not in regular conversations, not on Slack channels.
Thus I submit that our humble channel has earned something of a promotion, if only by virtue of not having been tumbled over by this last receding wave. We are sustained by the strength of our value proposition, and I daresay we shall be ready for the next elevation when the time comes.