HuffPo CEO Eric Hippeau: ‘We Are Now In The Big Leagues’
The news spread quickly, aided by PR and the characteristic web glee anytime an online property appears to be leaving old media in the dust: the September numbers for comScore and Nielsen showed Arianna Huffington and The Huffington Post beating WashingtonPost.com in unique visitors for the first time. Coincidentally, just about when I was explaining on Twitter why that’s a meaningless metric to me, I wound up scheduling some time with Huffington Post CEO Eric Hippeau for his first deep dive since moving from board member to running the show in June. (Turns out a project he championed—Social News with Facebook Connect—may have had the biggest single impact on pushing the numbers. More on that below.)
I kicked off the lengthy interview by explaining my take on the “beat WaPo” meme: an online site beating traditional media for attention isn’t really news anymore—and HuffPo is no longer only a news-and-politics site going head-to-head with WashingtonPost.com in its own backyard. Ever the diplomat, Hippeau said he could see my points but quickly added: “It wasn’t so much the Washington Post—by the way, it’s also the LA Times, it’s also the online edition of the Wall Street Journal. Of the big national newspapers, there’s only two our size that are still bigger than we are: USA Today, which is a very different audience, and the New York Times, which will always be a big brand and very well read and well respected. We’re not in a race with the newspapers. We’re not in a race with anything in particular. Our goal is to establish the brand that defines news and opinion on digital platforms.”
And the numbers are meaningful for HuffPo: comScore credited the site with 6,825,000 uniques in September, up 50 percent year over year, while Nielsen Media Metrix, which changed its methods and has seen some swings as a result, went with 9,474,000 uniques, up 26 percent. (WashingtonPost.com, by comparison, dropped 30 percent to 9.2 million, according to Nielsen.) Either way, it shows the site can grow in an election off year. The company says its internal Google Analytics also hit a record with 27 million uniques. But, citing competitive reasons, Hippeau wouldn’t release internal stats for time spent, number of return visits or registered users.
Hippeau added: “We’re very technology-centric. We use all the digital tools at our disposal, a lot of which we create ourselves, a lot of which are available to anybody else. We tell stories about current events in real time, so we’re very fast, we create—we help create instant opinion, so instant news and instant opinion.” He cites “a very active, very engaged audience that reacts very quickly to what’s going on in the world” and HuffPo’s blogging community of thousands.
—Can afford to grow: After raising a little more than $37 million, HuffPo also has the financial leeway to invest in growing the site, moving it beyond politics and current events to a host of verticals including style, fashion, green, books, technology, business, media. The newest is Impact, focused on philanthropy; a sports vertical is due by the end of the year. At the same time, the site has added local editions in Chicago, Denver and New York with Los Angeles due this year. Plans for next year haven’t been finalized. All of that has helped traffic improve in a non-election cycle, but the biggest boost for September may have come from a project that launched Aug. 17: Social News with Facebook Connect, fast-tracked by Hippeau who is a strong believer in the HuffPo as a social network.
At my request, HuffPo supplied some details: Facebook referral traffic is up 48 percent since the launch—and the already-heavy volume of comments jumped to 2.2 million from 1.7 million in July. Fifteen percent of HuffPo comments now come from Facebook. In September, Facebook referrals accounted for 3.5 million visits, up 190 percent from June and 500 percent from January. Those numbers continue to build, according to HuffPo’s internal stats. (Small irony alert: Don Graham, chairman and CEO of the Washington Post Co. (NYSE: WPO), is on the board of Facebook.)
—Still in investment mode: When Hippeau, who spent much of the decade as a venture capitalist, replaced Betsy Morgan as CEO, he told me he could make HuffPo profitable “today” if that was the immediate goal but the board of directors and investors wanted to grow the company. Is that still the case? Yes, he insists. “We have a big opportunity. We have a strong team, we have a strong balance sheet. We’re going to continue to invest—and in our minds, do that prudently. We’ll make sure there are core segments of the Huffington Post which are profitable and we’ll invest, whether it’s in new verticals or new cities, platforms ... At the same time, we want to make sure the earlier products, the earlier services we produce become profitable. That’s doable and I’m very confident we’ll get there.”
So far, he doesn’t feel pressure to stop investing. “What’s the point of having a strong balance sheet if you don’t make use of it? We have a board and investors who expect big things from us. They expect us to take advantage of the opportunities, to keep the momentum going and to keep investing.” That doesn’t mean acquisitions. It does mean thinking of the competition as the big players in news and opinion—CNN.com, NYTimes.com, etc.—not back at smaller sites like Slate or Salon: “We are now in the big leagues and in order to make the needle move, we have to do impactful things.”
—How are they making money?: “The old-fashioned way—hard work and selling advertising,” Hippeau replied. He’s not interested in book publishing like The Daily Beast or side projects. “For us, what’s really important is being able to grow our page views so that grows the inventory. It’s important for us to get to know the audience better and better so we can supply that to the advertisers and they can get a better feel for what they’re buying.” The biggest change so far is the hiring of Yahoo vet Greg Coleman as chief revenue officer, replacing James Smith. Coleman, who was ousted from the top ad job at AOL (NYSE: TWX) after Tim Armstrong became CEO, started at HuffPo three weeks ago. Hippeau said Smith did a “great job” but Coleman’s seniority means he has relationships plus experience in the changing internet space.
He sees marketing and advertising as issues that are bigger than HuffPo: “We collectively as an industry are going to have to come up with innovative, tech-driven ways for people to advertise. If we really want this business to grow as an industry, we’re going to have to do a better job with brand marketing, engagement marketing, visualization, the way ads look.” HuffPo is launching some of the new IAB and OPA ad formats. “What you’re going to see visually on the Huffington Post and others sites, is the ads will have a bigger impact.”
Hippeau isn’t going as far as Yahoo (NSDQ: YHOO), which dropped all but one ad off its front page, but HuffPo has cut front-page ads by one third in the past few weeks. He says it “absolutely” makes the front page more valuable but they aren’t charging more for it. As for changing the ad mix on interior pages and section fronts, “we’re moving from the outside in.”
—Upgrading “indirect” ads: The bigger change in the interior pages so far is from the way HuffPo is dealing with ad networks and its efforts to improve the quality. In terms of revenue, the ad networks are “an important but small part of our revenue mix.” Most of the site’s revenues com from direct sales. HuffPo recently signed with PubMatic to optimize its ad network use. “We want to retain a large amount of control over the quality. We have a very high-end, very sophisticated audience; we want to make sure the ads are also of sophisticated quality.” That, in some ways, is more important than cleaning up the clutter.
—International plans: Hippeau says HuffPo doesn’t have any. “It’s not an international strategy, Almost every week some pretty big organization would like to partner with us.” But for now, international efforts are limited to a deal that helps put the right ads in front of non-U.S.-users.
—Hippeau’s Q1 results: “The company, like most fast-growing startups, gets pulled in all these different directions, there’s so many opportunities for the Huffington Post that we actively have to stay focused, make sure we understand what the upside for us is from a revenue, a content, a development point of view and I think that’s one of the things we’ve been able to accomplish.”
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Posted In: Advertising, Media & Publishing, Online News, Social Media, eric hippeau, greg coleman, huffington post
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