Blavity CEO Morgan DeBaun saw a gap in the media market: a lack of content for black millennials like herself. In 2014, she left her tech job to launch Blavity.
“We needed a place, a platform and a media brand that could speak to our stories as part of the young, black creative culture,” DeBaun said.
Over the past five years, Blavity built a family of five sites covering news, technology, travel, entertainment and women’s wellness. The company also runs two conferences: AfroTech, for black innovators in technology; and 21Ninety, a gathering for women’s health and wellness.
Blavity is venture-backed but DeBaun takes a cautious approach to fundraising, since high valuations lead to unrealistic growth expectations.
Early on, $1.8 million in seed funding helped Blavity buy two of its properties: travel site Travel Noire and entertainment property Shadow and Act.
A $6.5 million Series A round in July 2018 enabled Blavity to ramp up programmatic advertising on its site. Blavity connected its programmatic pipes, hooking up to multiple exchanges and setting up header bidding. Blavity also hired engineers to grow its custom content management system, which incorporates posts from its community members.
For all its growth and connection with its readers, DeBaun knows she’s building a media brand as competitors are crumbling around her – like the 2,000-plus layoffs experienced by media companies this winter, including BuzzFeed, Verizon Media, Vice and Gannett. She shared with AdExchanger how she’s building a sustainable media brand and community for black millennials.
AdExchanger: Blavity has a diversified business model, which is very on-trend these days. Where are you now, and where do you want to go?
MORGAN DEBAUN: Companies absolutely need to diversify revenue streams. In 2018, our largest revenue source outside of advertising was experiential, including sponsorships and ticket sales. We will continue to grow our audiences through these conferences, but we are also doing a significant amount of research into the future of the ad world. It’s very fractured. It takes a significant amount of technical resources on the publisher side to build your waterfalls, to build the infrastructure so we can have a footprint across many programmatic platforms.
What have you done with programmatic so far?
We didn’t do display advertising in a serious way until last year, despite that fact that we had huge traffic and pageviews. After our Series A, we invested in a five to 10-person ad team focused on programmatic.
That team is ramping up, and they’re implementing header bidding and testing premium marketplaces. They are six to nine months in. For 2020, programmatic will be a significant part of our revenue, probably 50% to 60% of total revenue.
Why is display advertising working so well for Blavity?
Because our market is so underserved, we wind up with premium CPMs, which is contrary to what people thought when I started the company.
People wanted to know if advertisers were willing to pay the same price for a black demographic. I said, “Absolutely.” If you want to reach young people of color in cities, with a high net worth and a diversity of interests, there are only a few publications reaching them.
The model of VC-backed funding for media companies has come into question, because the returns are different in media than in tech. What made your funders want to invest?
We want to go deep with a specific demographic and have multiple touchpoints with them throughout the day, week and year. We are intentional about building community first. We use “love metrics” internally to make sure what we are creating provides value.
That sounds like a metric borrowed from a tech company. What does a “love metric” include?
It means engagement. What a lot of digital media brands focused on was getting pageviews and impressions, getting to 100 million impressions. We solve for people coming back on a weekly basis and engagement across all our channels. If someone is on our newsletter but doesn’t click on an article, we are OK with that, as long as they are opening it and getting value from it.
We think about churn, return and word of mouth – if they love it so much, they’re talking about it.
Univision started Fusion with the goal of speaking to this same underserved, multicultural audience you mention. It’s been a bumpy road for them. Have you learned from their experience?
I think they moved too fast. Going back to the idea of getting 100 million impressions a week, that was their strategy. They went to advertisers and said, “We did this rollup, and by default we are multicultural.”
But the brands didn’t mean things to people. Media brands need to go back to focusing on their consumers and community and less on what advertisers want.
How does adding programmatic complement your direct sales strategy?
We saw that big brands were doing integrated marketing buys: spending a couple hundred thousand dollars on the conference, allocating another percentage of editorial or video and a guaranteed private marketplace (PMP) for the rest. We’ll allocate 20% to editorial or video, and the rest was the guaranteed PMP. Before, I couldn’t say yes to the PMP deal. Now I can say, absolutely, and you can do this deal not only on Blavity, but our four other brands. I’m catching [readers] on multiple occasions, because they could start their day on Blavity and wind up on Travel Noire on Instagram.
How do you perform compared to other millennial publishers?
We have higher click-through rates than a lot of the mainstream millennial peers, especially if they let us design the creative. If you are a luggage company and send me something that doesn’t have any brown hands in it, it’s not going to work.
This interview has been condensed and edited.
