NowThis Partners With MEC to Make Branded Video for Agency Clients
NowThis, which creates news video specifically to distribute across social platforms such as Snapchat and Facebook, has struck a deal for in-house ad unit NowThis Studios to create content for MEC's clients.
Under the non-exclusive partnership, NowThis Studios' socially-optimized videos for MEC clients will be shared across NowThis's popular social channels, exposing them to a vast audience that's heavy with the millennials that marketers covet.
"We just love the work that we've seen from them in the marketplace," said Shenan Reed, MEC's president of digital for North America, of NowThis. "We wanted somebody who had the ability to be creative with the approach and to really make it for the client, not just for their point of view."
The deal is a "strategic partnership," and no money will change hands, said Ms. Reed.
But it could be valuable for NowThis, where the central business challenge is an increasingly common one in this age of distributed publishing: turning audience into revenue.
"The advertising industry and media dollars usually lag behind audience," said Athan Stephanopoulos, senior VP-strategy and partnerships at NowThis.
NowThis undoubtedly has a large audience. According to NewsWhip, which tracks social publishing, NowThis brings in more than 650 million video views every month across distribution channels like Snapchat and Instagram.
Monetizing that audience is a long process, and Mr. Stephanopoulos said business is "picking up quarter after quarter" -- though the company wouldn't share its financials.
In 2014, NowThis inked a deal with Mondelez International, and a "new-wave digital newsroom" was built to create video advertising for Mondelez's brands. That partnership is still active, though it operates on more of a brand-by-brand basis, Mr. Stephanoploulos said.
NowThis had already been working with MEC on proposals for their clients, according to Mr. Stephanopoulos. The new partnership was "an opportunity to formalize a relationship between the two parties," he said.
Ms. Reed said her agency is also considering other, similar content-creation deals.
While NowThis can offer a "very unique proposition" to agencies and advertisers, according to Mr. Stephanopoulos, many brands are also creating in-house multimedia advertising studios, reducing the need for NowThis' commercial services.
The company's leadership has also been in flux over the past few years.
NowThis does not have a president or a CEO, and, Ad Age has learned, is not discussing the possibility of hiring a new president to replace Sean Mills, who left the company in 2015 and is now at Snapchat. (Mr. Mills could not be reached for comment.)
But NowThis still has Kenneth Lerer, who co-founded the company back in 2012 and serves as chairman. An internal leadership team reports directly to Mr. Lerer, who also serves as executive chairman of BuzzFeed, Mr. Stephanopoulos said.
"Ken's very active in the strategy and the execution of the business," he said, adding that Mr. Lerer "cares deeply" about NowThis.
Like other young digital media businesses, the company is raising venture capital money to bankroll its expansion. (The latest: a $16.2 million "growth round" in December 2015.)
Mr. Stephanopoulos said NowThis is going to begin "aggressively hiring," adding to its staff of "slightly under 50" with a particular focus on new editorial talent.
Asked about NowThis' place in the digital world, and whether it's unfairly left out of discussions about the top tier of New York-based media companies, Mr. Stephanopoulos said he's just happy to be in the conversation.
"If NowThis is mentioned in the same sentence as a BuzzFeed -- which it often is -- then we're succeeding, then we're doing very well," he said.
However, the Buzzfeeds, Vox Medias, and Vices of the world have valuations in the high hundreds of millions and billions of dollars, which NowThis does not -- at least not publicly.
Eason Jordan, NowThis' founding general manager, is bullish on his former company's chances of making the business work.
"I'm a big believer in NowThis, its founders, its leadership team and their vision," he said in email to Ad Age. "Nothing more to add."