Buzzfeed has taken the ‘news’ world by storm with a unique approach which invokes criticism from legacy media players, but succesfully challenges many of the basic notions of how news organisations can function. Cat videos help drive audience for sure, but there is much more to this story.
The fundamental concept behind Buzzfeed is ‘social’ news. Every article is commissioned and written with the intention that it gets shared, or becomes viral. This is described by The Motley Fool here:
“BuzzFeed founder and CEO Jonah Peretti has described the company’s goal as becoming ‘the defining media company for the social age,’ a phrase notably front and center in the press releases of its investors. BuzzFeed’s redefining of how the business of media gets done would seem to be more about leading publishers into more effective ways of monetizing their businesses than it is about content.”
Critics says that in fact the business model is not about content at all, rather about capturing revenue on each article.
Ben Thompson in Stratechery.com writes in “Why Buzzfeed is the Most Important News Organization in the World” that the basics of the news business model are undermined by the internet and that Buzzfeed is capitalising on the new dynamics. For example, unlike a newspaper there are no limits to the amount of content Buzzfeed publishes, and unlike the traditional locally based mastheads it is essentially a ‘global’ brand. Perhaps most importantly it accepts that the audience is the arbiter of what is newsworthy, removing the guardianship traditional journalists have over what is published and where. If the community of readers deems the article interesting or important it will be shared. If it fails to meet those tests, it will not.
Thompson says the company has developed a sophisticated understanding of its audience and is now capitalising on this. He explains where Buzzfeed captures revenue:
“What’s especially exciting about BuzzFeed, though, is how it uses that knowledge to make money. The company sells its ability to grok – and shape – what works on social to brands; what they don’t do is sell ads directly. By ads I mean the sort of display ads you see on just about every other publishing site; your typical BuzzFeed page will have links to stories they have created for brands for pay”.
The criticism is that in doing this Buzzfeed has blurred the line between editorial & sales, building sponsored content into its feed of news. Additionally, it has been tarnished with the ‘click bait’ mantle, articles designed specifically to produce clicks.
To counter this Buzzfeed’s Editor Ben Smith argues:
“BuzzFeed has never sold a banner, and I couldn’t even tell you how many monthly page views we get. And so our business model at least moderates that incentive to drag every last click out of our audience.”
The benefit of this says Thompson is that “by not making money from display ads, and by extension deprioritizing page views, BuzzFeed incentivizes its writers to fully embrace Internet assumptions, and just as importantly disincentivizes pure sensationalism.”
There is much to debate about the business model, in particular the point at which Buzzfeed captures revenue and the impact this has on the editorial process, but the reality is the formula is working. Buzzfeed is starting to invest in serious public interest journalism, or ‘content’ as we might now call it. They are aggressively recruiting investigative journalists and building a network of foreign correspondents globally. They don’t rival the major players yet, but they are doing a lot with a little. This is the primary reason Buzzfeed is one organisation everyone in the industry is watching.
And now that you’ve made it through this blog-post, here’s a cat video for your viewing pleasure!