Yonge Street Publisher Explains the Sponsorship Model
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Yonge Street Publisher Explains the Sponsorship Model

Yonge Street with Detroit’s model D and Pittsburgh’s Pop City, all published by Issue Media Group.

After yesterday’s post about Yonge Street, we caught up with Paul Schutt, co-founder of Issue Media Group, Yonge Street‘s Detroit-based publisher. He answered some questions about his company’s editorial practices and its somewhat original way of making money in local web journalism: sponsorship.

Schutt explained Issue Media Group’s business model to us as being like the model used by National Public Radio. The similarity has to do with from where the two companies draw their revenue. Both of them rely on sponsors, rather than advertisers.
The question of what, exactly, distinguishes a sponsor from an advertiser is somewhat philosophical. The duration of the relationship could be a factor. Issue Media looks for yearly commitments from its financial supporters.
Motivation also counts for something. If advertisers pay for advertisements because they want to make money or become well-known, then sponsors pay for sponsorships because they already have money and are well-known, but would also like to be thought of nicely, or to support a cause they endorse.
Schutt said that even though the style of reporting practised by Issue Media’s sites is sometimes perceived as having a deliberately positive slant, the sites never pander for their sponsorships.
“That’s the thing we struggle with,” he said. “It has nothing to do with ‘positive’ to us. It’s not good news or bad news. We want to cover growth. We feel like if we were to cover the loss in the market, it’s not a competitive space; it’s already well done.”
In other words, ideally it’s not that Issue Media sites distort stories to make them seem positive, but that the beats the sites cover (“development” and “innovation and job news”) are just especially laden with positive stories to tell. Schutt insisted that the reporting published on his sites is critical when it needs to be, and that corporate sponsors understand that they have no input. In a previous interview with another site, he said that sponsors sometimes pitch stories, but that those pitches aren’t given special consideration.
“What we’re able to do is ask organizations what issues they care about,” Schutt said. “So for example with RBC [a Yonge Street sponsor], the issue they care about is diversity. So they’re actually underwriting the issue of diversity. The stories will not be about RBC, and they know that.”
(One of Yonge Street’s sponsors, as the Post astutely pointed out, is actually the City of Toronto, which makes us wonder where our cheque is.)
Reading the content on other Issue Media sites, it quickly becomes apparent that the quality of articles is variable, both within and between sites, just as it would be anywhere else, online or off. A featured article on Bmore, Issue Media’s Baltimore-based site, is critical of plans to expand military bases in Maryland. On the other hand, an article over at Issue Media’s Detroit site, about a company called CEF, contains the phrase: “CEF doesn’t just talk the talk, they walk it.”
It seems as though how well an Issue Media site lives up to its ideals is in the hands of editors. Fortunately, Toronto has some good ones.
As for that NPR analogy: it’s not a perfect one. Only 21.1% of NPR’s revenue came from corporate underwriting in 2008 (about a third of their revenue came from listener donations), whereas Schutt told us Issue Media’s sponsors tend to be roughly 80% corporate in any given market. Also, NPR is a nonprofit and Issue Media Group is not.
There is also an issue of how well Issue Media’s editorial mission will translate to Toronto. In most of Issue Media’s existing markets, which include its home city of Detroit, as well as a number of other ex-industrial U.S. cities (Cincinnati, Baltimore, Pittsburgh), it aims to position itself as an alternative to the “dated narratives” of crime and urban decay. Schutt said his company’s expansion into Toronto represents a new focus on what he called “growth markets.”
Finally, commenters on yesterday’s post on Torontoist about Yonge Street were, appropriately, curious as to why no Issue Media sites allow comments on their articles. Schutt said Issue Media had tried comments in the past, but, for reasons that don’t seem as though they would be cause for particular concern in Toronto, the experiment didn’t work out.
“In markets like Baltimore and Detroit, in the past we’ve turned on comments, but I would say the bulk of the activity becomes kind of racial hatred,” said Schutt. “We will turn them back on, but we probably won’t allow anonymous comments.”