January 25, 2017    Business

How to Create a Marketplace for Writers and Publishers

It’s hard to make money as a writer because there are so many people (not just writers) who want to be heard and are willing to publish their work for free. As the saying goes, “There is a lid for every pot.” Each piece of writing (lid) by itself is virtually worthless unless it can find the right context (pot). Writers give away their work partially because it’s too much work to find the right context that would pay for their work. In most cases, they would lose money if they accounted for the value of their time looking for the right publisher.

Here is an idea to address this problem which needs to be implemented by a company like Medium that already has a network of writers and readers. Because this is an idea for a two-sided marketplace, it would be nearly impossible to build such a network from scratch just for this purpose. (It would face the chicken-or-egg problem at the start.) So, below, I’m going to use Medium as an example of how this could work.

A writer has a choice between publishing her article immediately or posting it to the marketplace for a week where only the potential publishers can view it. The marketplace should work very much like iStock does. For each article, a writer should provide information that would aid in finding the right match, like a description, minimum bid, licensing options, keywords/tags, category/genre, tone/mood, target demographic, whether she is willing to edit/customize it (and, if so what the fee is), etc..

On the other hand, the publishers can fill out a form specifying what type of articles they are looking for. The key to success of this marketplace would be how good this algorithm is.

If it can accurately find the articles they want in the same way Pandora can, the publishers wouldn’t have to do anything; they would be notified if the right articles become available.

The algorithm would have to be intelligent enough to detect tone, mood, appropriate level of education, age, political leaning, gender, income level, etc.. It can’t just rely on what the writers specify. Just as in Pandora, it would be helpful if the publishers can provide examples of articles they want as the “seeds” to find new articles.

Once the right match is found, the publisher can place a bid along with the maximum bid they are willing to pay. The rest of the experience would be very much like that of eBay.

After a week of being on the market, if there are no bidders, the article is published automatically and is moved to the marketplace for non-exclusive licensing. This way, there is no additional work involved in publishing an article on Medium. The only sacrifice the writers would have to make is a week delay in publishing. Since most of the writers on Medium are not expecting to make any money, if someone is willing to pay any amount of money, it’s like found money.

In addition to a fixed fee licensing agreement, the marketplace can also offer a compensation scheme based on popularity. The buyer would agree to inserting a small piece of code with the article they publish on their own site so that the system can keep track of the number of hits.

Given the popularity of content marketing, I believe there will be many small businesses and publications willing to pay moderate amounts for exclusive articles. Larger companies will pay more but, naturally, there will be fewer of them. This, therefore, will be a “long tail” business model, and for that reason, the entire process of matching the right buyers with the right articles, licensing, and payment processing must be automated.