Businessmodel of Medium

Customer Segments

Medium targets users who wish to publish their writing online, in a similar way to a traditional blog, as well as users looking for varied and high-quality content in one place.

The platform, however, also attracts professional writers who are paid for the content they provide. This, coupled with the site’s organisation and interface, give the platform, more professional feel, typically attracting more informed, thoughtful writing than traditional blogging platforms. Medium also caters to existing publications that would like to expand their readership base, by housing external content.

The Company also provides innovative native advertising solutions to big-name brands.

Value Propositions

Medium provides a simple and accessible platform for users to publish content online and share it with an audience of millions of users.

The platform prides itself on its ‘what you see is what you get’ user interface, which allows users to publish articles as they appear while they are being written, removing the distraction of complicated formatting and streamlining the publication process. An added value is that the platform’s services are provided to writers and to readers free of charge, with opportunities for contributors to be paid for their writing.

For brands looking to expand their audience, Medium provides creative advertising solutions in the form of sponsored collections, which enable companies to have their name associated with quality written content. Medium’s platform has an audience in the millions of monthly users.

Channels

Medium’s platform can be accessed via its desktop and mobile websites at www.medium.com, as well as through its Apple iOS and Google Play apps. In 2015 Medium launched several in-house publications, focused collections of writing with a common theme, all of which can be accessed through their own individual web addresses. This includes publications entitled The Message, The Nib, Cuepoint, Backchannel, Matter and Vantage.

Customer Relationships

Medium’s varied customer base require differing levels of attention. Its unpaid contributors and readers are provided a self-service model, whereby they are given the tools to publish online with no intervention form the Company itself. The platform’s content is also currently free for readers to access. Medium remains largely community-driven, with the majority of its content provided by its community of unpaid contributors.

Medium interacts with its users via a number of its own accounts on the platform. This includes user accounts for its engineering and design teams, as well as for co-founder and Chief Executive Officer Armstrong.

Brand partners that wish to sponsor a collection of articles on Medium’s platform require a greater degree of direct interaction with the Company. In addition to the direct negotiations with Medium’s sales and marketing team required to handle these partnerships, the content published in these collections is collaborative and entirely funded by the sponsor.

Key Activities

Medium develops and operates an online publication platform for professional and non-professional writers. It also manages a number of editorial partnerships and provides native advertising solutions to major international brands.

Key Partners

Medium’s most obvious partners are its contributors, comprising paid and unpaid users, brands that wish to take advantage of Medium’s native advertising options, and formal editorial partners. In late 2015 Medium announced partnerships with several publishers, including Mic, Fusion, Travel + Leisure, The Awl, MSNBC, Discovery and Steven Johnson’s How We Get To Next. The exact nature of these partnerships was not discussed.

Medium has also released a publishing API allowing integration between Medium and other platforms. Developers have, to date, integrated Medium with several other publishing and productivity applications, including WordPress, Byword, iA Writer, Ulysses and IFTTT.

Key Resources

Medium’s key resources are its technology infrastructure, its personnel, its investors and its contributors. The Company’s content is provided by its amateur and professional authors, and editorial partners.

In terms of personnel, the engineering and development, and sales and marketing teams are key to maintaining the Company’s platform and its partnerships.

While the Company is still developing its revenue streams, it also continues to rely heavily on its financial partners, notably lead investor Greylock Partners.

Cost Structure

Medium’s major costs come in the form of personnel retention, partnership management, and maintenance and development of its technology infrastructure, including rental of server space.

The Company also incurs typical fixed costs associated with operating a business such as office space rental and utilities, for its offices in San Francisco and Washington DC.

Revenue Streams

While Medium does not currently generate significant revenue, relying principally on its financial backers to cover operating costs, it has been exploring a range of methods by which it can monetise its content.

Medium has so far experimented with a hybrid native advertising and sponsorship model, which Medium founder Williams has stated will be further developed. To date, Medium has published two Sponsored Collections – a series of articles on a common theme presented by a brand – in the form of design-focused Re:form by BMW and travel-focused Gone by Marriott. Under its agreement with Marriott, Medium published 60 articles in four months, five of which were based loosely on Marriott with the sponsor openly identified as the publisher. The remaining articles were written by a third-party and were concerned more broadly with travel. These deals see the brand cover all the production costs of the articles in return for having their branding attached to the stories. The Company is also considering allowing brands to sponsor individual articles in Medium’s existing publications.

Additionally, Medium has begun to generate a small amount of revenue via its content partnerships. In 2015 it was announced that the Company had agreed to publish Esquire content in return for shared advertising revenue. While Medium has a number of other editorial and content partnerships, it is unclear whether shared ad revenue is standard. Medium is also considering the development of premium content and subscription-based models to generate further revenue.