1 Amazing Thing BuzzFeed Can Teach Indie Filmmakers About Making Money
In a Sept. 4th, 2013 post to paidcontent, Matthew Ingram analyzes the explosive growth - and reported profitability - of BuzzFeed.
If you're reading this post, you are probably already familiar with BuzzFeed and the numbered ("18 Everyday Products You've Been Using Wrong," "22 Things Miley Cyrus Looked Like at the 2013 VMAs", etc.) "listicles" it typically offers.
That's because heavy internet users (the cool people who visit my site?) are likely to have encountered a link to a BuzzFeed page - with an amusing or informative list. BuzzFeed is known primarily for offering "viral" content that BuzzFeed's staff has organized - often into numbered lists using animated GIFs or pop-culture references. More often than not, a BuzzFeed page will have captured something in the online zeitgeist in ways that are more dynamic and amusing than a typical TV or print media news story.
BuzzFeed has developed a distinctive style - their own hugely popular way of capturing what users want to know about online. The BuzzFeed method often involves detecting spreadable content (ideally, just as it is starting to trend) and then adding BuzzFeed's own editorial content along with subtle ad messages (that's where the revenue comes from). When the recipe works, the content and the ad messages are shared by users and resonate across the web - using what is known as "viral lift." (Viral lift is typically defined as the number of users who entered through unpaid shares over the number of users who entered through paid placements - another way of thinking of viral lift is "seed views" vs. "viral views.")
To kickstart the process of "going viral," BuzzFeed is even experimenting with paying other sites to carry BuzzFeed's sponsored content on their homepages. As reported in AdAge on March 19, 2013: "A big part of Buzzfeed's pitch to advertisers is the "viral lift" its content will get. So Buzzfeed is willing to pay a premium [above the typical minimum of 3 cents per thousand impressions] to a site like Fark, whose readers share the Buzzfeed advertiser posts at a high rate."
The BuzzFeed formula - getting advertisers to pay for impressions with the understanding that the content and the ads will then be spread by happy users - seems to be working.
With 300 employees, BuzzFeed is reportedly profitable.
In a memo to BuzzFeed's staff, published on LinkedIn on Sept. 4th, 2013, BuzzFeed founder Jonah Peretti announced that the company had "booked [a] record profit in August" - making real money off sponsored content that is written and seeded but relies on the participation of users sharing on their social networks to spread the content online.
BuzzFeed's growth has been rapid. 4 years ago the company had zero revenue. In 2012, BuzzFeed's staff created content for 265 ad programs related to sponsors and they plan on doing three times that in 2013. And, according to Jonah Perretti: “BuzzFeed reached record traffic of 85 million unique visitors in August ."
"We are 3X bigger than we were just one year ago, 8X bigger than we were two years ago, and we have served more web pages so far in 2013 than we have in the entire previous five year history of the company. By this time next year we should be one of the biggest sites on the web."
BuzzFeed's growth has been so rapid that even traditional media outlets are paying attention. In May of 2013, CNN (under former NBC head Jeff Zucker) partnered with BuzzFeed to create informal online videos - using CNN's library of footage as well as original content from a newly-constructed LA studio. As reported in The Hollywood Reporter on May 27th, 2013. CNN's decision to partner with BuzzFeed came, in part, because "[m]ore than 70 percent of BuzzFeed's traffic is social and the majority of its readers are between the ages of 18-34, a demographic conspicuously younger than those that routinely watch television news."
So what can indie filmmakers learn from BuzzFeed?
New World filmmakers increasingly need to understand (master?) the fundamentals of spreadable content and viral lift.
In the Old World, you were advised to protect your content from being copied.
In the New World, knowing how to create and offer spreadable content may be the difference between success and obscurity.
What the Old World called "piracy," New World filmmakers often want to encourage.
Copying - or simply sharing - something you don't "own" is an essential component of "viral lift."
Yes you still have to monetize your work. But getting users to willingly share your content (perhaps in ways that carry a message about how to pay you?) is increasingly one of the skills that will distinguish successful New World filmmakers from the vast majority of content creators.
Do you want to rise to the top? Or sink below the surface in a sea of online videos?
Posted by Randy Finch on Thursday, September 05, 2013
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Randy Finch's Film Blog:
Thoughts from a film producer about making and distributing films.
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