If you have not heard of Snopes it is well worth checking out. It is a fact-checking site that analyses stories, myths and legends etc. And tries to ascertain if there’s any truth to them. Recently, in response to coronavirus the company has seen a massive 44 percent increase in its traffic compared to the previous month. With more than 30 million readers, presumably eager to find out the truth about various coronavirus myths. The only problem is that the company’s revenue is shrinking.
Vinny Green the Vice President of operations talked about the changes,
“There has been a decrease in CPMs as we’ve been approaching the end of the quarter and the expectation is that it’s going to drop off a cliff. We normally anticipate quarter two going more up and to the right, but we expect it to be flat or worse,”
This Pandemic would ordinarily be a big boon for the company but unfortunately, they don’t have a lot of funding due to ad revenue and therefore they can’t take on more writers to keep up with the amount of content needed to cover the virus. Green commented,
“The idea that we were going to keep our team operating at 120% and combat the onslaught of misinformation wasn’t going to happen,”
Snopes have gone all out for their team of 17 providing them unlimited sick leave, a big cash bonus and a reduced schedule so they can focus more on important news. Green commented on trying to strengthen Snopes business by saying,
“We cannot come to the next pandemic and not be able to increase our capacity. The choice is we either burn out or employees by chasing traffic or we say to the staff, we can’t treat this infodemic any differently because we literally can’t afford to.”
Back last year Green was interviewed by an online publication and he was asked about the Snopes business model. He stated that the companies goal was to move to a model where they were more reliant on the revenue created by advertising rather than through subscriptions which Green states are not sustainable. It currently has 7500 founding members and this service costs thirty dollars but he realises that this money won’t be there forever and that their business model has to be fluid.
That said the company did turn over a profit last year according to Green. And in a breakdown of their finances, it would appear the majority of their income, around 55 percent, came from advertising streams. Although this has been declining throughout the year. The year to date figures suggests that 59 percent of their profits were attained through programmatic advertisement spaces whereas the rest of their revenue came from reader contributions, memberships etc.
Supply and demand
The head of programmatic at Havas Media, Andrew Goode explained how the rules of supply and demand apply in advertising just as they do everywhere else. Admittedly traffic is up everywhere as people are isolated they are online more. However, just because people are there it doesn’t mean that media buyers are investing right now. At the moment their priority will be continuing to find the best ways to engage their consumers.
Snopes is in a tricky situation at the moment because of the world we live in. In a society filled with fake news, there are lots of rumours surrounding the virus. Goode pointed out that leaves a company like Snopes vulnerable because a lot of their work, which is quite important, covers coronavirus and that word is being blacklisted which means getting advertising revenue for their articles could be even more difficult.
Perhaps to avoid being crass or maybe through just not wanting to cash in, Goode stated that roughly eighty percent of his client base was blocking content about coronavirus.