Now the focus will be how well Buzzfeed sells advertising. It's
betting that more and more brands will move larger and larger
pieces of their digital budgets from display and into what's being
pitched as "social advertising." It knows that to meaningfully
engage consumers in this digital, social world, brand messaging
needs to be in a form that 's native to the medium and evokes what
the brand stands for rather than what it sells. And, of course,
it's banking that if you want that content to be shared online from
friend to friend, from coworker to coworker, Buzzfeed is the best
site to make it happen.
The company's pitch to brands is straightforward: We'll work
with you to create content, and help it go viral by tracking which
items are shared most among certain social circles and then pushing
the content getting the most "viral lift" into more prominent
positions on Buzzfeed.com. That piece of content could be a list of
"10 Upcoming Movies that Are Perfect for Date Nights," sponsored by
K-Y, or a map showing 50 different meals -- one for each state --
that can be made with Crescent Rolls, brought to you by Pillsbury.
(Both real examples.) On Buzzfeed's homepage, the headline and
intro for branded content is slotted into rectangular slots between
editorial content. The only distinction is the yellow shaded
background on the branded units and the "Featured Partner" tag in
For brands that need more scale, Buzzfeed extends campaigns
offsite, using technology to target segments of its own
super-sharing community with ads on third-party sites. It also
creates ads to run on social platforms such as Facebook, Twitter
and Stumbleupon. This now accounts for 20% of revenue.
"What we're doing is still new in the market, and we don't do
IAB [Interactive Advertising Bureau] units, only these
social-advertising campaigns," Mr. Peretti said. "But there's still
a huge amount of money going to the standard IAB stuff. So repeat
business and growing deal size isn't the challenge; the challenge
is getting new people to try us for the first time."
The company said it ran more than 100 campaigns in 2011, helping
to triple revenue from 2010. Buzzfeed won't say what the 2010
revenue was, though it was almost certainly less than $10 million.
Jon Steinberg, the company's president, said Buzzfeed hopes to
triple revenue again this year.
Buzzfeed still has its work cut out. The company has yet to
break into big categories of advertisers, such as auto brands, in
any meaningful way. But it has created solid early traction,
especially with media and entertainment brands. BBC America worked
with Buzzfeed to promote the TV show "Dr. Who." For one campaign,
Buzzfeed posted a photo list of Dr. Who-themed crochet characters.
The post was shared to Facebook 4,000 times.
"The sponsored posts that they customized for us feel so organic
to the site," said Matt Stein, VP-promotion, marketing and creative
services at BBC America. "They don't feel like advertisements."
Of course, sponsored posts aren't exactly new. But Buzzfeed has
managed to wrap the concept in social sheen, sprinkle in its pop
culture-focused voice, and optimize distribution better than
As Buzzfeed moves, the tides are turning with it. Twitter is
focused on advertising that appears in the same form as its
existing tweets and trends. And Facebook puts more emphasis by the
day on its Sponsored Stories business.
In an interview with Ad Age at the company's Manhattan office
last month, the conversation shifted toward Facebook's increased
focus on sponsored posts -- ads that are native to the Facebook
"In a sense, I think we're already there," Mr. Steinberg
So you've beaten Facebook to a true, social-advertising
"I do think we've beaten Facebook to it," he said. "We're fully
native with our story advertising."
Before Mr. Steinberg could continue, Mr. Peretti stepped in.
"In fairness, they'll probably beat us to 1 billion users," Mr.
Mr. Steinberg was not suggesting that Buzzfeed was the next
Facebook, only that perhaps Facebook could learn a thing or two
from Buzzfeed's ad business. But Mr. Peretti tapped his foot on the
brake a mile ahead of the speed trap. The business potential is
still just that : potential, he seemed to be saying.
Then, having made his point, he accelerated. "It's an exciting
time," Mr. Peretti said. "It feels like a shift is happening and
we're in a good position to help lead it."