BuzzFeed’s Q2 earnings report shows the digital media company weathering the pandemic with advertising and ecommerce growth significant year on year. Online shopping is seen as a key area for development as the shift online is sustained in consumer spending.
- Total revenue at Buzzfeed was up 51% on the same period in 2020, rising to about $89 million in the second quarter. Ad sales accounted for almost $48 million, growing 79% year on year. Ecommerce revenue, including affiliate commissions, jumped more than 80% to reach $17 million on a higher volume of transactions.
- The growth is good news for BuzzFeed, coming ahead of the $1.5 billion IPO that will follow the digital media company’s recently announced merger with a special purpose acquisition company (SPAC). But it has to be seen in the context of a crushing revenue shortfall for the same period last year, the height of the COVID-19 crisis and one the weakest periods for media spending in years.
- BuzzFeed’s ecommerce revenues are still 13% of total sales, but the business has forecast ecommerce revenue will grow sixfold to $330 million by 2024 to make up almost one-third of total revenue. Advertising revenues, while still predicted to rise by more than 150%, will increase more slowly as the digital ad market matures.
BuzzFeed CEO Jonah Peretti said the company had relied on a ‘data-informed’ approach to focus its content creation efforts and direct investment. He saids that approach allowed the business to, “capitalize on secular trends in advertising and commerce and helped fuel our significant topline growth in the first half of the year.”
Seeing the figures for online shopping, which grew exponentially through the pandemic, continue to trend upwards, several publishers are investing in their ecommerce infrastructure.
- Digital media business Dotdash, which operates 14 websites and makes more than 30% of its revenues from ecommerce, is launching its first standalone store. The online shop will sit alongside the drinks site Liquor.com, which it acquired in 2019. It will stock a limited selection curated by Liquor.com’s editorial team. The lineup will include cocktail kits, glasses and decanters.
- The new standalone store has been presented as an experiment. But Dotdash CEO Neil Vogel says, “when we get this right, the expectation is that you’re going to see a bunch of these at our key brands. If we can make it work, it’s a really interesting potential business for us.”
- Short-form video platform In The Know by Yahoo is adding shoppable fashion content to its existing cooking and parenting channels. In The Know Style will feature original video series focused on shoppable content and highlighting ‘diverse voices, industry up-and-comers and expert tutorials’ important to Gen Z audiences.
- Live shoppable video has been a success for In The Know since the brand began piloting the experience this past spring. “Commerce is at the core of the exponential growth of In The Know over the last year,” said Andrea Wasserman, Global Head of Commerce at Yahoo. “The launch of In The Know Style is a natural extension of our strategy of bringing entertainment-driven, authentic, and shoppable content to our audience.”
With global ecommerce retail forecast to be worth $7 trillion annually by 2024 and $10 trillion by 2027, publisher interest is only likely to increase.