2013 has been the year of BuzzFeed. It started by raising $19.3m from investors and continued with the disclosure that its worldwide audience was racing through 130m monthly unique users and that it had broken into profit with advertising revenues trebling to $60m. The year is ending with
an email from Nick Denton, founder of top-ranking US celeb site Gawker Media, who has told his staff: “The bad news is we got overtaken by BuzzFeed in November.” And, now, there are predictions that the BuzzFeed audience (like its advertising revenue) will soon be larger than that of the world news site leader Mail Online which has just hit 150m users. As if to emphasise the competition with its London-based rival, BuzzFeed scored 10m UK users in November – a 400% jump in the eight months since it launched there. And government minister Grant Shaps became the country’s first front-line politician to write on BuzzFeed, pushing energy policy. Not a riveting read, but a sure sign of things to come.
It’s a long way from 2011 when the little-known site broke the news, in the US elections, that former presidential candidate John McCain was endorsing Presidential challenger Mitt Romney. Readers and commentators alike asked “What is a BuzzFeed?” That was the first political scoop for BuzzFeed and for Ben Smith, its new editor-in-chief, a star recruit from the US site Politico. Today, BuzzFeed is an amazing mix of genuine political scoops, viral videos and easy-to-digest lists (“19 struggles you’ll only understand if your parents have Facebook”). Its sparky content, eye-catching design, and mastery of ‘native’ advertising increasingly make it look like a winning model for online news. In earlier times, Newsweek magazine used to trumpet “news you can use”. BuzzFeed is all about “news you can share”.
BuzzFeed has more than 300 employees and has been soundly profitable for the past year. That’s a contrast with Mail Online despite the no-slouch UK site’s (currently) larger audience; and underlines BuzzFeed’s dependence on sponsored content rather than banner ads. There are lists of animated images promoting Google+ photos or features on winter attractions in New York that promote the state lottery’s scratch-off games. Its campaign for Pillsbury was typical: “10 Things You Never Knew You Could Do With a Crescent Roll.”
The BuzzFeed boom has wowed major US advertisers. It trebled revenue in 2012 and, again, in 2013; and is expected to double to $120m in 2014. This year, it will have booked 700 social-advertising campaigns, all there for the slightly crazy mix of content, ranging from stories on “The 16 Greatest Cat lady Gifts” to “Snowden’s Venezuelan Asylum”. An ability to combine targeted advertising with seemingly unrelated stories is clearly part of the success: BuzzFeed understands who its readers are and what they want. It has taught marketers to write BuzzFeed-like stories which promote their brands without in-your-face advertising messages. And the ads often appear on Facebook or Twitter with the shared stories. BuzzFeed lives on those social networking sites as much as on its own domain.
What has been described as “the first social news organisation” is the brainchild of Jonah Peretti, a Manhattan-born graduate of M.I.T.’s Media Lab. He was one of the lesser-known founders of news aggregator and blog The Huffington Post, and has been called a “viral marketing hotdog” by the New York Times and “the poster boy of guerilla media” by AlterNet. Fast Company named him one of the “New Faces of Social Media” and cited BuzzFeed as one of the “50 Most Innovative Companies” in 2012. Business Insider listed him as one of the “11 Rising Tech Stars to Watch in 2012.” Peretti actually invented the Reblog “share” button as an open-source tool for blogs, applied first by Tumblr, then Twitter and Facebook. Such reblogging/ re-tweeting has, of course, become a core feature of social networking and a potent means of promoting secondary content. And it’s the propulsion for BuzzFeed.
For all his entrepreneuralism, the serial “digimedialist” Peretti is still the academic. In 2005, while working part-part-time as director of R&D at the Eyebeam Art & Technology research centre in New York, he hosted the “Contagious Media Showdown” where participants competed for hits. They collectively amassed over 50m unique visitors. It was the catalyst for his theory of the “Bored-at-Work Network” which, he asserts, is larger than some major television network audiences and is behind most of the e-mail forwarding and link-sharing that drives the worldwide spread of internet ideas.
Peretti seems obsessed by the simple question: “What makes ideas spread?” It started in college, when he ordered a customized pair of Nike shoes with the word “sweatshop” on them. Nike refused to fulfill the order, and he sent the email chain with customer service to 12 friends. They forwarded it on and, eventually, it reached millions of people. The viral email exchange with Nike was covered in the Wall Street Journal and on prime-time news programmes.
In 2005, he joined editor-in-chief Arianna Huffington and former Time Warner executive and digimedialist Ken Lerer (a key backer of BuzzFeed) in the launch of HuffPost which was originally known primarily as a political blog. Ms Huffington was the big personality upfront and Peretti was quietly focused on “content that would spread” which formed a key part of the site’s DNA. Happy to be in the HuffPost engine-room, he was responsible for developing the celebrity gossip and (some would say) trivia behind the front page of serious news and commentary. The site was one of the first systematic users of SEO and spawned Peretti’s side project, experimenting with viral content – which became BuzzFeed. His new site became preoccupied not with what people were searching for but with what they might share. His technologies tracked items of content that were contagious, things that appeared on one person’s Facebook page and then many other people’s.
The New Yorker’s hyper-active, twin-track career continued for almost five years during which he struggled to keep the two jobs as separate and uncompetitive as possible. He was splitting time between the two offices, and his frantic daily routine involved picking up 15 sandwiches at a Vietnamese shop between the two and feeding editors at each place. But it became increasingly fraught. “I thought Huffpost could be a media business and BuzzFeed a tech business which would avoid the awkwardness of both companies trying to hire the same type of people.”
BuzzFeed did not start hiring teams of editors and star reporters until he left HuffPost after its purchase by AOL in 2011. But the strategy was not new. In 2008, Peretti (whose five-person BuzzFeed then had a monthly cash “burn” of $60k) wrote a presentation deck that quoted CNN: “We looked at BuzzFeed and sensed the future”.
He had designed BuzzFeed as a “free, open platform for launching ‘buzz'”, and saw it as “a one-stop shop for web ‘buzz': editorial, algorithmic, user generated…able to dramatically grow traffic without hiring editors”. (He then had just two editors). And, there it was five years ago, the first known reference to non-standard, “native” advertising:
“BuzzFeed partners can publish and promote their buzz on the BuzzFeed site. The promotion is native to the site and works as content and advertising.” For those targeting trends, the BuzzFeed system “dynamically places ads next to the hottest content”. Peretti asserted tellingly: “The future of the industry is advertising as content. Key Examples: Google sponsored links and YouTube promoted videos. Advertising and editorial content (should) have the same format.”
Answering his own question about how big BuzzFeed could get, he predicted: “A global technology platform for a completely trend-centric type of advertising and media: the top outlet for every major brand that wants to grow buzz.”
When Huffington Post was sold to AOL almost three years ago, Peretti quit to work full-time on BuzzFeed.
With its mix of oddities, listicles and web “memes”, BuzzFeed was initially a bit like HuffPost without the news and commentary. But, then, Peretti hired Ben Smith. It was his new editor-in-chief who broke the news of the Romney endorsement. BuzzFeed was now firmly in the news business. Today, it has a team of more than 130 journalists, including star recruits like Pulitzer winner Mark Schoofs from Propublica and leading lights from the Wall Street Journal, the New York Times, Village Voice, Rolling Stone and Gawker. And it’s been busy recruiting in France, Spain, Portugal and the UK.
Peretti has been said to be reverse-engineering the HuffPost formula. At Huffington, he used search optimization to create a gaudy ‘funhouse’ behind a serious front page. At BuzzFeed, though, the ‘funhouse’ is the shop window. The main headers on the home page told the story: “LOL,” “cute,” “win,” “fail,” “omg,” “geeky,” “trashy” and “wtf?” But its serious news content is growing fast under the seemingly trivial, eye-catching design. In 2012, just months after Peretti left the AOL-owned HuffPost, BuzzFeed scored 600,000 monthly uniques – and attracted his first major funding, including from Hearst Corporation which remains a thrilled 10% shareholder. Now, BuzzFeed is ultra-serious and riding the wave of social networking: “People are now used to having everything mixed together in a Facebook newsfeed. A story about the Arab Spring will be next to a picture of your sister’s new baby. Why not have a publishing site that embraces those colliding worlds?”
BuzzFeed has moved beyond its core “Bored-at-Work Network” to the “Bored-In-Line audience”, who are viewing content on mobile. Peretti believes that news has replaced search as the way most people want to connect with information. This means reaching people through social engagement — 75 percent of BuzzFeed visitors come through social networks — and mobile. “If you build a web product and it doesn’t show up on mobile, you’re going to lose around half the people who could have potentially seen it. When we see traffic coming from mobile, it is disproportionately social….There’s a big shift happening and we’re at the beginning of it,” he said. “There are still industries to be disrupted. You need to think from the perspective of a user that wants to share something…The real key to a lot of this stuff is emotional intelligence.”
BuzzFeed is important. Not just because it is racing past legendary sites like the BBC and New York Times on its way (surely) to becoming the world’s most popular – and profitable – news service. But because it understands how to “sell” news on the web and, crucially, to how to make a profit from doing so. This website is changing the way the world consumes news.
Traditional media executives everywhere (especially in newspapers) are frustrated by their apparent inability to monetise what are often substantial web audiences. And that’s because they have grown up on a mass market diet of printed advertising spreads, and a neat separation of editorial and ads. That’s why so many ‘trad’ media people are gritted-teeth contemptuous of BuzzFeed. In an online world of targeted ‘native’ advertising and all-you-can-know analytics, many just don’t get it.
CNN was right in 2008. BuzzFeed looks like a significant part of the future of news. And, around the world, newspaper sites are rushing to imitate the picture gallery and listicles style. But that’s the easy bit. This powering social media news site is so much more than a well-designed, captivating package of content. BuzzFeed is the product of its highly analytical creator. It reflects his understanding of how content is shared, how tastes are changing and how to monetise it. He has created a new model for news, not merely re-designed it.
There will, of course, ultimately be more winners than just BuzzFeed in this area of “social news” – and who would bet against even more radical change from the networks (Facebook, Twitter, YouTube, LinkedIn et al) which feed the “buzz”? But they will have to be good – and may have to be totally ‘new’. Which traditional purveyors of news, content and advertising are capable of such total reinvention – while also managing/ milking their still-profitable legacy businesses?
But, it is tempting to conclude that many traditional news providers are no longer in tune with their readers, especially younger ones. Habits and attitudes have changed. As Jonah Peretti has found, people love sharing things. And readers simply don’t object to content that interests them – whether it has been paid for by advertisers or has come from the keyboard of an award-winning journalist.
Many traditional news bosses, wrestling with the whole idea of native advertising, have actually developed a convenient memory of how things have really been done for decades in the world of popular journalism. Newspapers have often been stuffed with slabs of editorial copy prompted not so much by real “news” events as by the blandishments of PR people trying to promote their clients’ wares. Even this last week, Britain’s biggest-selling newspaper The Sun shifted its famous “Page 3″ scantily-clad model to to page 5 in order accommodate a double-page ad. But, then, its editor was quoted last month as saying BuzzFeed was the best thing on the internet.
Some newspaper executives have re-written history to airbrush out the times they have had to tread carefully across harsh journalistic criticism, say, of a car manufactured by one of their best advertisers. And very few would have admitted, in those halcyon days, just how many readers were attracted primarily not by the journalism but by marketplace classified ads for cars, homes and jobs. After all, most newspapers had effectively been subsidised by advertising.
That’s before you even get to some all-but-sponsored traditional media coverage of everything from the arts to travel, motoring and health. And consumers of news and entertainment are well used to the plugging of films, books, sports and theatre. So what’s the difference with a food company proclaiming “20 things to make Christmas the best ever” in BuzzFeed?
But, much more than facing up to the reality of past practice, traditional media has to understand what the powering audiences – and advertisers – of BuzzFeed are getting hooked on. But quickly.
Welcome to the seismic world of BuzzFeed.