BuzzFeed and the Difficulties of Branded Ad Content

The digital native news site BuzzFeed is in trouble, as illustrated by a trending topic on Twitter.

The Financial Times reported an alarming statistic as revealed by the company.

Buzzfeed, until now the genre’s gold standard, had halved its 2016 revenue projections from $500m to $250m, after making $150m in 2015, 30% lower than expected.

Multiple articles found linked in the tweets above talk about the difficulties in terms of generating revenue from advertising.

Marketing Dive states:

BuzzFeed takes a different approach than most publishers with its distributed content strategy, such as the content specifically created for Facebook and Snapchat. Where most publishers earn revenue from website ads, 75% of BuzzFeed’s content never appears on its website.

 

Twitter users seem to be reflecting a common opinion associated with the debacle – branded ad content is too labor intensive for a large and growing company.

The situation may be a reflection of a changing economy. Surely this will have implications for future digital startups in their aim to generate a reliable source of web revenue.

Amazon’s Staggering Success

This video from BuzzFeed presents 12 interesting facts about Amazon, the e-commerce giant.

There are some shocking statistics shared in the video, including the fact that Amazon’s warehouses have more square footage than 700 Madison Square Gardens!

Amazon is a good example to start off the investigation into websites and their revenue. Last year, Amazon reported on their Corporate Press site the financials for the 2015 Fiscal Year.

Net sales increased 20% to $107.0 billion, compared with $89.0 billion in 2014. Excluding the $5.2 billion unfavorable impact
from year-over-year changes in foreign exchange rates throughout the year, net sales increased 26% compared with 2014.

Amazon, like other top websites, is attaining an increasing presence online as more people acquire Internet access.

The question that many may ask remains. How does Amazon do it? They offer extremely cheap prices and keep their customers satisfied.

Amazon has a specific way of generating web revenue, not unlike Google or even Facebook.