Steve Bagdasarian, general manager at Publishers Clearing House, considers what the demise of LittleThings says about the power Facebook wields, and what independent publishers can do to protect themselves.
The week before last, LittleThings, a highly popular digital publisher focusing on providing “feel good” content for women on Facebook, was forced to close its doors after a change to a Facebook algorithm. According to industry insiders, the publisher was among the top-performing sites for reaching a specific audience, but times have quickly changed.
LittleThings CEO Joe Speiser told Business Insider that the recent algorithm shift enacted in January, which Facebook said was designed to tamp down content that is consumed passively – and would instead emphasize posts from people’s friends and family – took out roughly 75 per cent of LittleThings’ organic traffic, while hammering its profit margins.
LittleThings, which had more than 100 employees, claimed to engage more than 50m visitors each month and influence more readers than any other standalone lifestyle site. Since its launch in 2014, LittleThings had collected over 12m Facebook follows and its videos regularly generated thousands, if not millions of views.
LittleThings’ sudden demise must have come as a shock to its leadership team. In fact, less than two years ago, Speiser expressed being highly optimistic about Facebook and its desire to help web publishers in a Wall Street Journal article ironically titled, ‘Facebook Loves Publishers,’ says LittleThings CEO. In the article, Speiser is quoted saying: “We need them for the traffic; they need us for the content. I think without the content all these media companies are providing, there’d be that much less reason to go to the news feed.”
For years we have been hearing that content is king, but this is clearly no longer the case. As evidence by LittleThings’ closure, content is useless without an owned audience to absorb it. Not only does this development, and how quickly it happened, rightfully worry other companies reliant on Facebook to provide its audience, but the buzz now is all about who will be next. This is just the latest signal that it’s time for publishers to reevaluate where audiences live and determine new and creative ways of reaching them. Without doing so, we will likely see more fallout due to Facebook’s changes and quickly see consolidation take place in the market.
For publishers to survive, they need to rely on more than strong content. Instead, publishers need to focus their efforts on what will provide real value: an engaged, large-scale, owned audience base. This may sound like a simple task, but as publishers know, there just aren’t a lot of viable alternatives to Facebook. Because of this, publishers must ask themselves: “Where does my audience live? How do they spend their time and what can I do to reach them?”
Barstool Sports CEO Erika Nardini, whose background lies in publishing, understands the power of an owned audience. In a recent CNBC article, Nardini said, “Because we have a loyal audience that has been with Dave for 14 years, and all of our guys – Big Cat, KFC, our whole roster – we can do anything. We can become a commerce company. We can sell shoes. We can be an alcohol brand. We can create a boxing promoter. There is nothing that this company can’t do because we have an audience.” A loyal audience base such as Barstool’s creates the ultimate scenario for marketers – a community of trusting consumers that follow recommendations on who and what to buy, read and engage with.
The ability of a platform like Facebook to eliminate a thriving business in a matter of weeks demonstrates the power that it wields and validates the importance of having a large, owned and loyal audience base. Although true audience diversification might not be possible due to the limited number of platforms available, there are alternatives that will lessen the reliance on a single provider for an audience base. Failure to shift the focus from content to audience soon will have dire consequences. Today we are discussing the demise of LittleThings; will you be next?