Tags: buzzfeed | vice | listicle | advertising

WSJ: BuzzFeed Set to Miss Revenue Goal by 'Significant Amount'

WSJ: BuzzFeed Set to Miss Revenue Goal by 'Significant Amount'
(Buzzfeed.com)

By    |   Thursday, 16 November 2017 06:31 PM

Digital publisher BuzzFeed is likely to miss its sales target for this year “by a significant amount” as media startups struggle to compete with Facebook and Google, which dominate growth in online advertising.

BuzzFeed had set a revenue goal of $350 million for 2017 but is expected to fall short of that figure by about 15 percent to 20 percent, The Wall Street Journal reported, citing people familiar with the matter. That means a shortfall of $50 million to $70 million.

Investors in the company are getting worried about the performance and higher costs to expand its news and entertainment, the newspaper reported. BuzzFeed originally carved out an identity by publishing “listicles” that were easy to read while swiping on a smartphone screen. The company’s audience grew as viewers moved away from TV and toward mobile devices.

BuzzFeed’s troubles reflect a broader malaise this year for ad-supported media businesses, including Vice Media and Mashable. Vice is expected to miss its sales forecast of $800 million, a person told the WSJ, while Mashable agreed to sell itself to Ziff Davis for $50 million, a fraction of its $250 million value during its last investment round in March 2016.

Digital media companies are having trouble scaling up the creation of custom content for brands, while Google and Facebook have a tighter grip on the digital ad market. The so-called “duopoly” will have a combined 63% of the U.S. digital ad market this year, according to researcher eMarketer, leaving less money for everyone else.

The likelihood that BuzzFeed will have an initial public offering next year is decreasing, people told the WSJ. The company was valued at $1.7 billion when NBCUniversal invested $400 million a year ago.

 “What matters is the consumer shift from traditional to digital has happened, and this shift will only accelerate,” Ken Lerer, managing partner of Lerer Hippeau Ventures and chairman of BuzzFeed’s board, told the WSJ. “If some of these companies are off a bit from their estimates a year ago misses the point.”

© 2019 Newsmax Finance. All rights reserved.

   
1Like our page
2Share
StreetTalk
Digital publisher BuzzFeed is likely to miss its sales target for this year "by a significant amount" as media startups struggle to compete with Facebook and Google, which dominate growth in online advertising.
buzzfeed, vice, listicle, advertising
338
2017-31-16
Thursday, 16 November 2017 06:31 PM
Newsmax Media, Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
America's News Page
© Newsmax Media, Inc.
All Rights Reserved