In the cover story for Folio:’s August issue, called “Building the Big Idea,” Hanley Wood CEO Frank Anton discussed the cost of building an online business, particularly as it relates to personnel. Despite budgeting for a $2 million increase in salaries for e-media jobs, Hanley Wood quickly found that amount was not enough. “Tech people are incredibly more expensive than what we thought they would be,” Anton said. “We have consistently underestimated tech positions and Web editorial by 10 or 20 percent, depending on the jobs. They’re far more expensive than entry-level editors.”

Other publishers are experiencing similar sticker shock. Once the domain of existing IT staffers, entry-level editors and even interns, the evolution of online media now requires personnel with a distinct skill set, and in terms of editors, the ability to manage themselves and the content beyond the scope of what a typical print editor has been asked to do.

According to the 2006 Annual Survey of Journalism and Mass Communication Graduates conducted by the University of Georgia’s James M. Cox Jr. Center, online media paid higher salaries to recent grads with Bachelor’s degrees than any other media, at an average of $31,500. Specialized information publishers were close behind with an average of $31,000, while consumer magazines averaged $28,000.

Many publishers are paying online staffers more money than their print staffers with similar job titles. “If you compare it to a more senior level print editor, the salaries are comparable,” says George Fox, president of Advantage Business Media. “But a lot of these folks tend to be younger than print editors and they’re coming in at a point where if you consider a normal starting salary for a print editor, it’s 40 percent to 50 higher.”

Publishers are paying for a broader skillset, including, but not limited to, technical savvy. “In addition to the journalism they have the technical skills and understanding of HTML,” says Fox. “It’s a second set of skills and they know what their value is and they know they’re high in demand. It’s a seller’s market for them now.”

With the pace and sheer volume of online content, Web editors often need to be self-managing. “The ideal is somebody who is a journalist first but who has this aptitude toward Web packaging,” says Chris Peacock, executive editor at “Which requires to some degree to think like an editor and a designer and an all-around Web person. When you’re putting a basic Web story together, it has so many more components than a magazine story, like active stock quotes, the kind of interactive charting you can add into the article, or the possibility of adding video. All of this is done on the fly and done very quickly. The absolute ideal is someone who can be a human Swiss Army knife. They need to be a good journalist, a strong Web packager, and have an eye toward what works on the technical side of things.”

Starting from Scratch
Advantage Business Media has budgeted between $3 million and $5 million for both online personnel and infrastructure in 2008, according to Fox. “It just continues to grow—on the print side of the business it’s finite,” says Fox. “On the Web side it’s 180 degrees of what it could be, and it never is what you put down on the budget.”

Advantage was fortunate to obtain some key Web personnel—such as SEO and SEM strategists—through its first series of acquisitions. However, the majority of its Web content is still handled by the print staff. Advantage has two teams responsible for uploading content onto the Web sites. “We’ve centralized all digital development,” says Fox. “Then we’re almost batch-processing content—the print editors are culling and deciding what they want to use and how. When it comes to authoring content and aggregation, a lot of it is being driven from the actual print editors.”

However, Advantage is now looking for dedicated Web editors to oversee the process. “Our business is broken into four portfolios and we’re looking for an editorial site manager for each one of those portfolios who would work with the Web development team not only to do batch processing but looking for other areas we should be strategically partnering with,” says Fox. “The print editors have a real affinity for what’s going on with the Web but it’s a bandwidth issue and there are varying degrees of knowledge and skillset. We’re supporting that with some people in the middle.”

While many publishers are putting the online load onto their existing print staffs without additional compensation, Advantage looks to reward its editors for overall performance. “We’re putting in realistic targets for them with overall revenue goals and whatever that incremental revenue is, they’re compensated on it,” says Fox. “A dollar is a dollar whether it’s a print or digital dollar.”

On the sales side, Fox hasn’t noticed as much of a gap in age or salary between print and online—and quite often print salespeople remain better compensated. Advantage is looking at adding some senior salespeople, including a group sales director. “We would align the portfolio so this person would be responsible for uncovering higher-end opportunities,” says Fox. “Compensation would be similar to print sales folks and it won’t be competitive between them. It seems there are people from the print side who made a conversion three or five years ago who now want to sell online almost exclusively. Others come from online-only media. Some of those we’ve recruited from online-only come in at a price level lower than you’d expect.”

Like Anton, Fox says that the new and ever-changing role of online makes it harder to budget against than established products like print. “The print side is a defined revenue stream,” says Fox. “You can budget against it and apply a cost of sales to it and determine the range a person will be in. On the online side, it’s speculative. You can’t set a specific number if you can only create a range of revenue.”

Labor costs are proving to be trickier than hardware and software. “It’s almost like constructing a house,” says Fox. “Material is 30 percent of the cost and labor is 60 percent. You start out with specific objectives and as you start moving down the pipeline, two or three really good ideas come to mind and you almost have to recast the whole plan. It’s like continuing in a spiral. What was going to take three weeks is now taking six or seven weeks and you’re still not finished.”

While he won’t reveal specifics,’s Chris Peacock says that people are the largest online expense. “In my experience, there’s a lot of competition right now for the human Swiss Army knife characteristics and the competition drives the price up. People are attracted to different aspects of media. If you’re not attracted to something that requires thinking about the multimedia aspects of the story, you’re not going to go for these types of jobs.”