ALSO: Politico’s John Harris and Jim VandeHei sent a note to staffers recently, praising their work and offering a glimpse into the Politico’s future and financial prospects.
We’ve obtained the memo and it’s after the jump…
As we stride over the finish line of this long, curvy, lots-of-hills marathon known as the 2008 election, it’s been natural for the two of us to think back to the start.
Two years ago this week:
Jeanne Cummings and David Rogers were working at the Wall Street Journal, Bill Nichols at USA Today, Erika Compart at U.S. News. Not one of them was thinking, so far as we know, “Hey, maybe I should bail on this established and well-regarded publication and join a wild start-up.” Bresnahan was at Roll Call, scoring big scoops and scowling at editors in ways that would become familiar to all of us. Ken Vogel had just arrived from Tacoma, tourist map and Metro Card in hand, to work for a soon-to-launch publication called the Capitol Leader. Mike Allen was at Time, immersed in our schemes and expressing enthusiasm. We wondered: Was he just humoring us, or did he really think we were on to something?
About those schemes: They were at full boil. The two of us were in the midst of covering the 2006 election (which was a pretty busy one also, you’ll remember) while holding covert meetings among ourselves and with two mysterious gentlemen, Robert and Fred, who worked over in Rosslyn in a couple of very large offices with nice views. The two of them and the two of us were both asking the same question: Are these guys on the level?
The election that will reach its finale tomorrow has been a defining event for Politico. It was an opportunity to produce great journalism and to build a nationally recognized brand. All of us–some 90 people who work on the editorial and business sides of Politico–have seized that opportunity in a way that has turned heads across our industry.
This election has also been, in more modest but important ways, defined by Politico. We set out two years ago to join the top tier of most important publications covering Capitol Hill and the 2008 elections. Recall Vande’s impolitic taunts (to none other than Michael Calderone, then with the New York Observer) that at Politico, “I think we’ll show we’re better than” two certain well-known publications, one in New York the other in Washington. That boast was, ahem, slightly off-message because, then as now, our aim is to create a new brand and a new approach to political journalism. We do not see ourselves in a zero-sum competition with old brands. But recall also the blind quote in the next paragraph of Calderone’s Observer piece: “I’m a little bit skeptical that this is enough to launch,” said a D.C.-based political reporter. “You’re competing against giants with just so much institutional leverage.”
So two years later, it was with satisfaction that we read a front-page New York Times story that mentioned three stories that began as Politico exclusives–all in the lead paragraph.
There are several things to say about what Politico has achieved in the 21 months since our first issue.
The first is thank you. Most of us are having more fun than anyone in the news business these days. But this place is also extraordinarily hard work–sometimes stressful, sometimes too busy to allow us to express adequately the deep appreciation we feel. We hope everyone who works here feels and will hold for a very long time a sense of satisfaction at being present for something special. We have created a publication that is new and vibrant, at a time when many news organizations are awash in pessimism and scaling back ambitions.
Which leads to the second point….Please take a moment to reflect on just how much all of us owe our publisher, Robert Allbritton. The only time Robert and Fred Ryan get impatient with us is when they believe we’re not thinking ambitiously enough. The two of them are truly visionary figures in modern media. They are sharp in refining and improving our ideas, and they also brim with their own. And they have the nerve to back those ideas to the hilt. They have never once, not ever, asked us to trim the news or complained when a story made life uncomfortable for someone they know. Imagination and integrity: You simply can’t ask for better qualities in a publisher.
The final point is to emphasize, as you have all heard from us many times, that the past two years are only a beginning. There remains room for vast improvement in how we cover our core subjects, in how the two of us manage the newsroom to produce the most creative journalism, and in how the business side of the enterprise achieves its goals. Getting better at the basics is only the start. In this fluid era of media–demolition and expansion both occurring at breathtaking pace–constant innovation is the only path to survival and prosperity.
That is the theme of some thoughts that follow. We thought the most valuable way to thank you for your efforts is by giving you a very candid appraisal of the state of Politico. There is probably no one in the business more bullish than the two of us and Fred and Robert–optimism based not on hope but on concrete evidence to date about how our editorial model and business model are working. But we also have a keen appreciation of how challenging the media environment is these days, and the serious effort it is going to take to succeed. We’d like everyone at Politico to have a similar appreciation of these trends. So as you catch your breath in the coming day or two, please read this document and reflect on what you can do to help make the next couple of years as exciting and productive as the past two.
Politico’s mission has been to drive the conversation in Washington and nationally on the subjects we care about: Congress, Washington issues and advocacy, and the 2008 election. After Nov. 4, most of the focus we have devoted on elections will turn to coverage of a new president and a new White House.
Looking backward, recent months in particular have thrilled us. The work we did around the conventions drew national notice. So have many of the scoops that Jeanne Cummings, Ben Smith, Jonathan Martin and others produced during the general election. It was especially gratifying to watch the Capitol Hill team–whose work has been the pillar of the print edition–stand out during the financial crisis. That was a fast-moving story that was told preeminently on the Web, more or less around-the-clock and over the course of several weekends. It was an important moment in establishing, to a wide audience, that our congressional coverage is in an entirely different league than our Capitol Hill competition.
In terms of visual appearance, of both the print edition and the Web, we once had a fairly low bar: We just wanted something that didn’t make us cringe. For some time now, we have had a much higher bar: We want Politico to be known for first-class design. Thanks to the phenomenal efforts of Paige Connor on the production desk and Ryan Mannion, our chief technology officer, Politico is now known as an innovator in the way it uses technology and visual arts to presents news to readers.
Looking forward, we have some huge opportunities across all fronts.
At the White House, Mike Allen will be leading a team that will be bigger and better than any news organization has ever sent to the White House. Politico’s 44 page–designed largely by Ryan and Danielle Jones–will contain elements of both a blog and a traditional home page. We are very confident it is going to be an essential destination for people who care about this presidency, rivaling our current home page for traffic and impact.
The lobbying/issues team, lead by Jeanne and Bob Hillman, has already started organizing itself around the next administration. There will be special pages, in print and on-line, on the intersection of Wall Street and Washington, on health care, on energy and environment, and on defense.
In the New Year, the Congress team will find itself at the center of a national and to some degree international story even more than it is this year.
All three teams face some special challenges as they organize themselves in 2009. To a greater degree than we have wanted, there sometimes has been a division within Politico. The campaign team’s work was organized around fast-moving work on the Web, while the other teams have been organized more around enterprise work for the paper. This won’t continue. Starting immediately, with the transition, we are going to see more integration between the two platforms, and even greater emphasis on the Congressional and lobbying teams’ use of the Web to full impact.
One of the most important achievements of 2008 is one we are going to build on in 2009: Creating a successful newsroom culture. Let’s be blunt: A start-up operation is turbulent, and our own management sometimes added to the feeling of white-knuckle improvisation. At times, people wondered where they stood. No one at Politico any longer should wonder about that. If there is any quality we have come to value–and one that we feel is too often lacking in newsrooms–it is candor. Much of our time is spent in conversation with people about how they are doing well and what they could be doing better. In nearly every instance, these conversations have led to important improvements in people’s productivity and impact and satisfaction with their job. As we turn the corner on this election, we’d ask people to think hard and with real specificity about their own signature strengths, about how to take full advantage of those, and about how they’ll measure success in the months ahead. If any of you feel that you need more input from us as you answer these questions, we expect you to come see us.
POLITICO BUSINESS OUTLOOK
Most journalists are happiest when they don’t have to worry about the economics of this business. Alas, that does not describe many journalists these days.
Politico is owned by a private and highly successful company. The specific information about our books is proprietary. Still, it is important for people to know in general terms about our business prospects.
When he launched Politico, Robert Allbritton told us that he was thinking, in rough terms, of a five-year horizon for measuring success or failure. It is a measure of our achievement on both the editorial and business sides that we can answer this question much earlier.
In our first 21 months, Politico has frequently achieved profitability as measured on a monthly scale. (When Congress is in session, our ad revenue is higher.) Our goal for 2009–one we fully expect to achieve–is profitability on an annual basis.
We were helped in this goal by a recent report by the Erdos & Morgan firm, which every two years surveys so-called “influentials” nationally and in Washington about their media consumption habits. The survey went into the field when we were a mere 15 months old — and the results were astonishingly good for us.
Among our critical Capitol Hill competition, we are the most read publication by opinion leaders in the DC metro area and nationally. We were near the top for being the most read publication on Capitol Hill — at a time when our core competitors saw steep declines in their audience reach since we entered the market. This survey covers the newspaper only. There is no doubt we do even better when web audience is factored in.
Because of our rapid growth, and the impact we have had over the past two years, there is no longer doubt about our ability to dominate the Washington market among political specialty publications.
Our average monthly revenue in 2008 grew by 105 percent over 2007 — an increase powered heavily by our print edition, which has become a must-buy for any advertiser trying to sway opinion on Capitol Hill.
We have already sold sponsorship to our Congress page, advertisers are lining up for exposure on the new Politico 44 page, and our Web sales on all pages are soaring.
One reason we are well-positioned against the competition is our web traffic. As you know doubt saw, we were in September the ninth most trafficked newspaper website in the country, according to Nielsen Net Ratings–the only new publication in the top 30, and the only specialty publication. Among political publications in Washington, we are 20 times larger than The Hill, our closest competitor.
And these stats do not include October, which broke our previous record by a wide margin.
For all our satisfaction with these numbers, is important to be realistic about traffic. We have no doubt that traffic will dip–how much, we don’t know–following the election. When it does, this won’t be cause for alarm.
The reason is that Politico’s business success–what will sustain our editorial success over the long haul–is not primarily dependent on a mass audience. The main part of our revenue, in print and online, comes from advertisers who want to reach our audience of Washington influentials — and know that the best way to do it is to buy space next to coverage that has impact and that people are actually reading.
This business model, we believe, insulates us to a large measure against the adverse trends in both the media business and the economy more broadly.
Outside Washington, our national audience gives us opportunities that are beyond the reach of our Capitol Hill competitors. We have a sizable and growing revenue stream with national brand advertisers, who want to reach an audience that research shows is wealthier and better educated than average.
An important part of this effort to reach a national audience is the Politico Network. Beth Frerking in the newsroom and business development chief Roy Schwartz have recruited close to 100 news organizations–the number is still growing rapidly–to join what amounts to a new method of syndication. Partner publications have access to our content, free of charge. In turn, our sales staff can sell against the political and public affairs stories in our partner papers, and both sides share in the revenue. This is a model that has worked to great success among other publications. Our profile in the 2008 election, and the way we are poised to drive coverage of the next administration, puts us in position to build the preeminent public affairs network.
For all our optimism and bullishness, we want to make clear that we understand–and everyone at Politico should understand–the sobering nature of these times. We cannot promise that the economy won’t affect Politico. What’s more, we are still a start-up, and we’ll never countenance frivolous spending. Whatever the future holds, we can be thankful that Politico is part of a successful and financially conservative company, which has the discipline to achieve its goals in good times and bad.
This note, while plenty long, only touches on many of the most important themes that will color our professional lives in the months ahead. There is plenty more to talk about, and we welcome the chance to answer any questions that people have.
For now, we hope everyone finishes up this election, and gets the rest they need to do right by themselves and their family and friends. As we look to the holiday, a new year, and a new administration, everyone associated with this enterprise has reason to be proud.
John Harris and Jim VandeHei
November 3, 2008