Can Brands Save Hyperlocal Journalism From An Epic Fail?

It’s not news anymore by now: “Hyperlocal” journalism start-ups and experiments are on their last legs. This year has already seen NBC News shut down its much-hyped EveryBlock network, and Politico shut down TBD.com, its Washington, D.C.-centric site. And then there’s AOL’s Patch, which is reportedly draining around $100 million each year from the waning empire. Earlier this month, Jim Romenesko posted a fascinating collection of emails from Patch editors all saying basically the same thing: “from what I see on the ground, we are on our last legs.” (Hat tip to Digiday.)

It’s easy to see why. In the age of programmatic marketing, the buying and selling of display advertising is getting increasingly automated and efficient, but ventures like Patch rely on a labor-intensive, old-school model: Sales reps hit up local businesses for display advertising deals at a few hundred bucks a pop. Since banner ads rarely work, this often ends disastrously for both parties.

“Eventually, you do have to call them back and explain the reports to them,” a former Patch sales reptold Digiday. “The click-through rates on our banner ads were terrible. You might spend a few hundred dollars on a banner ad and only get five clicks on it.”

In addition, hyperlocal journalism has been slow to embrace the kind of brand-sponsored content that’s been a goldmine for publishers like Buzzfeed, which gets upwards of $100,000 for four or five listicles.

But with hyperlocal journalism startups on the way out, what if brands decided to fill in the hyperlocal news gap and start ventures of their own?

After all, hyperlocal journalism has largely failed because the business model doesn’t make sense, not because people have no interest in community news. And brand publishers—who have no need to sell banner ads—are constantly looking to find a unique angle for their content, in the manner of how Red Bull has become the fastest-growing publisher and broadcaster of extreme sports content. Hyperlocal news could provide just that.

This could work on a city-by-city basis, with a hot new brand like Uniqlo cementing its foothold in New York City by reporting on hip news, fashion trends, real estate guides and events across up-and-coming neighborhoods like Clinton Hill, Astoria and Prospect Heights, and lightly branding the site in all the space freed up by the lack of banner ads.

Or, it could work on a national level, with an empire like Pepsi Co. or Coca-Cola spreading their influence far and wide by creating community newspapers across the country to replace the kind of local reporting that has largely disappeared.

And there are writers who know their cities who are willing and able to take on the work. Hyperlocal journalism could deliver big benefits to brands that make the upfront investment.

Still, there’s a lot of risk with such a strategy. Patch saw 12 million visitors in May 2013, an unimpressive figure when you consider that it’s spread out across several hundred community sub-domains. Patch also saw just 12 million visitors in May 2012, which indicates that they’re not riding any sort of upward trend. Many feel that the publishing model future is “hyperinterest journalism,” not hyperlocal. People want the news that matters to them, whether it pertains to their location or not.

But hyperlocal journalism and hyperinterest journalism don’t need to be mutually exclusive. In an excellent post, NewsCred examines the fact that The New York Daily News’ Desi section has become the top Indian news destination in the country by focusing on local South Asian news, events, culture, and entertainment. Finding these local, hyperinterest nooks may be the key to brands succeeding where Patch and others have struggled.

Given the gaps that will be vacated from the decline of sites like Patch and EveryBlock, it looks like the opportunity will be there for brands, and it’s an opportunity worth considering.