Jonah Peretti (CEO of Buzzfeed) just wrote a memo called 9 boxes.
The essence is this:
The reality is more complex; there isn’t one perfect model for digital media. The best media companies generate revenue from many sources, tapping a combination of advertising, subscriptions, studio development, brand licensing, and merchandising. As digital media matures, the best digital media companies will build diversified businesses with many revenue streams and do it wielding the inherent advantages of digital to be more audience-focused, data-driven, efficient and global than the big conglomerates.
I continue to be fascinated by Buzzfeed - there’s no other media company quite like it and they have some of the smartest media minds in the world working there.
This memo is worth drawing attention to - and if you’ve missed some of the moves they’ve been making like hiring 19+ people to write affiliate revenue content or creating a recipe book, fidget spinner or hot plate then it’s a good reminder to pay closer attention.
One specific idea here though is becoming increasingly important. As Peretti talks about a fragmented and decentralized revenue strategy it’s important to understand how critical the idea of brand is here.
Peretti uses this diagram to showcase how Tasty makes money (just one of their many brands):
As these brands look to expand their revenue model across multiple products, channels and formats the idea of a unified, distinct, appealing and loved brand is more and more important. I’d expect that Buzzfeed will double down on this by creating a bunch more brands in highly lucrative spaces (why focus on cooking when there’s more money in fashion for example?).
A good time to revisit my post branding in the age of content.