$137.8B U.S. ad spend for top 200 advertisers
The YouTube network Tastemade, sometimes considered a budding heir to cable TV's Food Network, is getting a lot closer to the channel with a $25 million investment from Food Network parent Scripps Networks as well as Liberty Media and Comcast's venture capital arm. Executives plan to use the funds to make content that marketers will sponsor and to add engineering talent.
Tastemade began last year as a YouTube network that collected clips of people cooking and talking about food, growing to attract some 18 million unique viewers every month, by Tastemade's count. Its core programming remains largely the same, but Tastemade is also increasingly adding more TV-esque (and brand-friendly) fare like "Thirsty For," a series that showcases drink recipes from around the world and was nominated for a James Beard Award.
The new funding could be a called a "TV round," given its sources, but Tastemade co-founder Larry Fitzgibbon said the company is already TV in a sense, with web video increasingly playing on smart TVs and TV audiences increasingly looking online. The question is whether and when TV ad budgets follow.
"We think this is the third wave of media," said Mr. Fitzgibbon, who created the company with former Demand Media colleagues Steven Kydd and Joe Perez. "It will be digital. We're building a global digital food network."
Tastemade has begun to premiere the first of five new sponsored series that it hopes will show advertisers they have a reason to spend online. The programming slate "helps define to a general audience how we think about creating high-quality standalone content and how a brand can be authentically weaved in," said Oren Katzeff, a former Yahoo and Demand Media executive who joined Tastemade last year to head up programming.
The first of the new series to show that thinking is "Local Flight." Sponsored by Bacardi's Grey Goose brand, the show's brand-picked host travels to different cities, selects a regional delicacy like citrus or chocolate and challenges a local mixologist to invent a cocktail on the spot using the delicacy and Grey Goose.
The idea for the 12-episode series surfaced last year after Bacardi's marketing team visited Tastemade's Los Angeles studio, which includes several sets including a bar, and felt like the two companies could work together on "something more than a flash in a pan," said Grey Goose brand manager Christopher Lyn-Sue.
"We want to make sure we're providing value to consumers, but in an entertaining format," Mr. Lyn-Sue said. "We don't want it to be something that felt forced."
He declined to say how much the brand is spending on the Tastemade deal but described it as "the largest video content investment we'll make in this fiscal year."
Tastemade itself is not yet profitable. Mr. Fitzgibbon declined to disclose Tastemade's revenue but said it is growing rapidly. More than half of Tastemade's views happen on mobile devices and connected TVs, he added.
Now Tastemade is looking to point more of those viewers toward brands. Mr. Katzeff said he has "twelve-plus years of seeing how the world of content online works and how brands interact with content." But he has a problem with typical branded entertainment. "It feels commercial," he said.
His aspiration for Tastemade's sponsored content is that it would look pretty much the same if you took away the sponsor. "It isn't branded entertainment," he said.
The other four sponsored programs Tastemade plans to introduce this year include a recipe series with Anheuser-Busch InBev that pairs a dish and location with the sponsor's Stella Artois beers. Chase Sapphire is sponsoring a food-and-travel series called "Off Menu" that seeks out hidden gems in the U.S. and around the world. And Kraft's Philadelphia Cream Cheese is working with two Tastemade creators to film four savory and four sweet dishes that use the spread as an ingredient.
Tastemade has also signed a deal with online wine community Bottlenotes to create a YouTube channel for the site as well as 30 videos that will span different series and standalone clips. One series in the works is called "On the Vine" and will star a Tastemade host who tours several Napa Valley vineyards and educates viewers about wine, like how to pair certain varieties with food.