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Social Media Media Planning and Buying Media

‘An octopus climbing a tree’: the future of BuzzFeed’s commercial strategy

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By Chris Sutcliffe, Senior reporter

June 8, 2021 | 8 min read

BuzzFeed’s acquisition of HuffPost raised questions about the future of the digital-first publisher. As the two teams begin working in tandem, the combination affords the publishing company advantages beyond simply a wider audience demographic, launching new products and commercial opportunities.

Kris Mikael

BuzzFeed and HuffPost’s combined audience could be greater than the sum of their parts

Who is the BuzzFeed reader who also habitually visits HuffPost? The audiences have a smaller crossover than even BuzzFeed’s commercial team expected; only 10% of readers visit both regularly, according to its own research. That presents the new combined business with a technical challenge, but also provides it with a huge amount of headroom for commercial and editorial growth.

BuzzFeed acquired HuffPost in November of last year. At the time, BuzzFeed founder and HuffPost co-founder Jonah Peretti noted that the combined reach of the two companies put it at the top table of media networks globally: “With the addition of HuffPost, our media network will have more users spending significantly more time with our content than any of our peers.”

It was also tacitly a response to the significant cuts across the entire ecosystem of digital-first publishers, which were once seen as the leading lights of the new publishing era. Advertising revenue did not keep pace with the ambitions of those digital natives, and diversification into affiliate and e-commerce revenue was only a good start to compensate rather than the end of the journey.

So what commercial opportunities available to a combined BuzzFeed/HuffPost can recapture some of the optimism about digital publishing? According to BuzzFeed’s commercial director for Europe Casey McDevitt, the opportunities lie beyond raw scale and in building upon the core strengths of both businesses.

A network of audiences

McDevitt acknowledges that BuzzFeed has broadened its commercial focuses since the heady days of the company’s founding, which has had an impact on its revenue mix: “When we first started we were doing the whole pivot to video ... but from that how much we’ve changed since then, native advertising was a huge part of our business, almost 100% of business in those days, that’s now down to 50% of our business.

“Our old chief financial officer always talked about being an octopus climbing a tree – you always need to have an extra arm climbing to the next branch before that snaps. Great analogy for Buzzfeed because if you rely too much on what’s doing great right now, things quickly change. So, yes, right now we’re seeing so much success in the likes of licencing and affiliate. I think that is a business that’s here to stay.”

At BuzzFeed that focus has manifested in the launch of brands like Tasty and its sexual wellbeing brand, which McDevitt believes are almost magazine brands that happen to exist purely digitally. He argues that affiliate and e-commerce revenue can be swiftly scaled across HuffPost using BuzzFeed’s existing expertise: “That’s been a space that we’ve grown a lot. We built a really big affiliate program with Amazon – just last year we sold 450% year-over-year growth on Amazon Prime Day. Expand that to HuffPost – the huge audience, talking about different products and the like – we see that it’s an immediate opportunity.”

That immediacy will first be seen in HuffPost’s publishing strategy over the course of Amazon Prime Day later in June. The entire strategy has been spun up over the course of two weeks, according to McDevitt, which speaks to how quickly the team is adapting.

What is particularly striking about that lack of crossover between audiences is that it allows the combined company to turn its attention to serving an older audience using the content creation expertise of the BuzzFeed team. That has a significant impact on the ability of the business to generate revenue from sectors like travel and auto, which McDevitt acknowledges have been hesitant to spend on BuzzFeed due to procenceptions of its content and audience.

New opportunities

Outside that affiliate revenue, BuzzFeed is taking the approach that there is significant opportunity around sponsored content. McDevitt states that one of the key areas where BuzzFeed can learn from HuffPost’s previous efforts is in its podcasts and sponsored sections: “We haven’t done much in the podcast or newsletter spaces. HuffPost has a lot there. So Paul Waugh at HuffPost has got The Waughzone ... brands want to be in that space so there’s a big opportunity there.”

McDevitt also notes that diversification and partnerships are going to be integral to the strategies of digital publishers in the mid- to long-term. Overreliance on third-party platforms and the ill-fated pivot to video that followed were, after all, the reason for the diminished relevance of the digital natives five years ago. It ultimately led to decisions such as the diminishing of HuffPost’s UK news division in the immediate aftermath of the acquisition.

Despite that, McDevitt is optimistic about the benefits of those partnerships. He says: “One of our biggest growth areas last year from BuzzFeed was we’ve got a really deep partnership with Twitter. So, as brands want to also expand beyond that duopoly, Twitter’s a great place to do that, to have that huge addressable audience.”

That newfound focus on partnerships with Twitter has led to the launch of series like #WhatToWatch, a partnership with Tesco centered around Tasty, and an upcoming gaming-centric show called Press Play to launch this autumn. It speaks to the strengths of inter-company expertise sharing, as we also saw with Vice building upon Refinery29’s branded content strengths post-merger.

McDevitt also believes that there is a huge opportunity from the demise of the third-party cookie. Publishers with strong internal sub-brands like Tasty or BuzzFeed News have the ability to use contextual advertising to target audiences without invasive tech. In that space, the publisher with a larger network of those sub-brands has an advantage: “We are going to be building the largest cross platform. People want to be around real audiences, and that’s what we have.

“You want loyal audiences and real passionate audiences and people that actually come back to a destination. Now that we can do this with multiple brands across the globe, it’s really exciting.”

There is still a lot to be worked out, both for the combined BuzzFeed and HuffPost and for digital-first publishers in general. After the past year sponsorship revenue is only beginning to rebound, and there is still significant uncertainty about the future of digital advertising following privacy changes from browsers and platforms. Despite that, there is undoubtedly strength in shared expertise, such as that between the existing commercial teams at BuzzFeed and HuffPost.

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