Earlier this month, news hit that BuzzFeed is likely going to miss revenue targets this year–by as much as 15% to 20%. Now the Wall Street Journal is reporting that the Jonah Peretti-cofounded media company plans to cut 8% of its U.S. staff–all on the business and sales side. The Journal adds that “some editorial staffers and business-side employees in the U.K. will also be let go.”
Sources tell me BuzzFeed is currently having an all-hands meeting in which the news is being delivered. It comes amid what can only be described as the continued bursting of a digital media bubble. Mic’s “pivot to video” has caused its traffic (and, reportedly, company morale) to significantly drop; Mashable is reportedly selling itself to publisher Ziff Davis for a fraction of what it was once worth; Even Vice is expected to miss its targets this year.
Digital media has always been tough, but many hopefuls looked to BuzzFeed as a beacon of how a company could adapt to the shifting media ecosystem. It had great traffic and has spent the last year diversifying its revenue efforts with new forays–which include Tasty and BuzzFeed Motion Pictures, as well as programmatic advertising and other e-commerce projects. Some of these bets were working. Tasty, for instance, had over 1.9 billion views in October, up 14% from September. The company’s plans to go public next year indicated even more hope. But its best efforts haven’t scaled to the level BuzzFeed had hoped, and now the IPO has reportedly been put on hold.
Meanwhile, BuzzFeed’s traffic has been stagnant. Last month, consulting firm Activate published a chart that looked at digital audience growth for the top media sites. Most of the coverage focused on how right-wing sites have lost a great deal of traction over the years. But the chart also shows BuzzFeed saw no audience growth between August 2016 and August 2017, according to comScore numbers.
It should be said that comScore does not always offer the most complete window into a publisher’s audience metrics. In BuzzFeed’s case, it has been working to grow its audience beyond its own website, via other sources that may not be captured by comScore. Indeed, the company has been known to rail against standard metrics like unique visitors as full indicators of success.
Still, the revenue miss and staff reductions point to a rocky road ahead for both BuzzFeed and the entire digital media industry. Despite attempts to diversify, Google’s and Facebook’s continued dominance over the digital ad market will dampen even the best of efforts.