It was recently announced that Buzzfeed has raised $50m investment from venture capitalists and is planning to use the money to offer more content, expand its video production unit and open more international offices.
With an audience of 150 million monthly users, Buzzfeed has taken the opportunity to tap into its huge readership to launch as a news distribution site. Its site gets roughly four times more viewers per month than The Times and was valued at three times more than the Washington Post, bought by Jeff Bezos for $250m this year.
Clearly, Buzzfeed is not the typical media company and it is doing things very differently. Buzzfeed understands how important it is to go where its users are, instead of trying to pull them to its website, and also knows it is crucial to produce the content that its users are after. But what can other businesses learn from this change in direction?
We have identified five areas where companies could benefit from Buzzfeed’s approach.
Customers, data and analytics
Companies such as Buzzfeed are intensely focused on their customers’ preferences based on the data that comes out of every interaction with users and its site, running the analytical engines on what is being read, even offering this kind of dashboard to people posting to the site.
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Decisions on content and which topics are written about are therefore invariably driven by customer analytics, rather than editorial teams. This is only to be expected.
Buzzfeed is, at its heart, a technology company. As a result, the question other businesses have to ask themselves is: what percentage of business decisions are made on the basis of analytics rather than the judgement of a small group of people? And why?
The new engagement
It is crucial to understand how to reach and engage customers and users. This is achieved by proactively going to them and being where the customers go, rather than trying to tempt them to come to you of their own accord.
According to TechCrunch, 75% of BuzzFeed’s referral traffic comes from social media. This is an impressive figure and businesses should follow Buzzfeed’s example by engaging with audiences in the places where they spend time online to boost their own referral traffic, rather than relying on them to go straight to their websites.
Disruptive technologies such as social, mobile, analytics and cloud (SMAC) are very much part of the ‘new engagement layer’, complemented by the new breed of sensors for security and data, as shown by Barclays’ plans for biometric readers in online banking.
Having an extremely well-performing website is now a mere stepping stone to getting your SMAC- and sensor-driven engagement layer correct. Organisations must use the information that surrounds people, organisations, products and processes – what we call “code halos” – to build new business and commercial models.
These code halos contain rich business value that far outstrips the value of physical assets that have historically underpinned market leadership, and are at the heart of many enterprises’ advance from old-world industrial models (premised on physical assets) to new models based on their mastery of “digits”.
Competing for attention
“You’ll never believe what she did next”; “What he did will blow your mind” – we have all seen these headlines and, more often than not, we have clicked on them, too. It can be hard to capture customers’ attention and keep it, but it is crucial to do so.
Without attention, you may get nowhere, even with the best products. Again, it comes down to having a good understanding and analysis of your customers and what really engages them.
Change when you are on top
Companies need to recognise the need to evolve, even when they are at the top of their game with no pressure, rather than when facing a survival battle. It is a great lesson to take away: keep evolving, especially when you are successful, and you are more likely to maintain forward momentum and stay ahead of your rivals.
There is always room for innovation
Of all the industries, the publishing sector is one of the most challenging in which to be innovative and successful, yet that is exactly what Buzzfeed has shown can happen. Everyone can innovate, whether that is simple incremental ideas to improve internal processes or a paradigm-changing innovation.
Many companies may consider themselves to be very complex, very digital or completely commoditised, but there is always an opportunity for disruption and innovation. The question is, will you do it or will it be done to you?
Disruption in news distribution
Buzzfeed has shown that understanding its audience incredibly well and making innovative use of technology can lead to great success. By harnessing code halos and SMAC technologies, businesses of all kinds can achieve similar results by developing their offering to deliver exactly what their audiences want.
With every transaction, click or swipe of a phone, tablet, laptop, Glass, Nest, dashboard or other smart device, consumers are building a digital fingerprint of who they are and what makes them tick, unlocking great value and the potential for incredible commercial disruption.
To succeed, future-looking businesses need strong analytics and a solid cloud infrastructure to cope with speed, scaling and the ability to respond to spikes in traffic. Any business that fully embraces a digitally-savvy approach and the full range of SMAC technologies that allows it to converse with its customers will be able to run much better than, and very differently from, their competitors.
Ved Sen is senior director, advisory services, social, mobile and sensors, at Cognizant Technology Solutions