Rappler announced that the homegrown social news network is inching towards profitability after just two years of operation following a recent hike in online ad revenues.
During the Philippine Software Industry Association conference, Maria Ressa, Rappler chief executive officer, said that ad spend has been slowly shifting in favor of online, resulting to a quicker return on investment than expected.
“Based on our business model, we will break even on our third year. But I think we’ll break even as early as the end of the year,” she said, as quoted by the Manila Bulletin.
Started in 2011, Rappler prides itself as the only pure internet-based news organisation in the country and has been making waves in the industry by capitalising the speed and reach of social media from the get-go.
Unique to Rappler is its use of the Mood Meter, a patented publicly-available analytics which measures the sentiment of readers towards a specific story and presenting it as a simple infographic. Aside from effectively engaging readers by making them part of the site, the valuable data gathered makes a compelling business case to advertisers keen on targeting.
Ressa said an unnamed major advertiser has already shifted 20% of its ad spend from television to internet websites. She owes the uptrend to the very nature of Filipinos, with most finding a new home in social networks like Facebook and Twitter.
“When we were starting to figure out where to set up Rappler, I was living in Singapore where it cost only a dollar and it took only one day to put it up. We looked at Singapore and Indonesia. But why Philippines? Because of its social media engagement. We’re the highest. The potential is there,” she said.
She also owes its rosy figures to lower expenses for news gathering. Ressa shares that online news gathering cost just 7.5% of the capital expenditure of a news organization in a TV network.