Jonah Peretti on how BuzzFeed is like an early movie studio and why he encourages 'crushes'
Peretti sat down with Nicholas Carlson, editor-in-chief of INSIDER, at Business Insider's IGNITION 2015 conference.
(Edited for length and clarity.)
Nicholas Carlson, INSIDER: We all know BuzzFeed, obviously, but do people know Tasty by BuzzFeed? It was launched in [summer 2015]. And it has 1.2 billion views on Facebook in October. Which is a large number, obviously, but here's how large it is: The next most viewed property on Facebook in October was around 740 million ... and the next one after that was BuzzFeed Food and BuzzFeed Video. And Tasty by BuzzFeed had more views than those two combined. And my question for you is how did that happen?
Jonah Peretti: So we're always testing new ideas. One of the things we realized about three years ago was that food and lifestyle content was something that people really loved and would share. It also was something with the potential for a bigger impact. So when we did a food article like a clean eating challenge or an exercise challenge - we would see people following along and posting on social media the food they cooked or the exercises they were doing. So we saw that it had a bigger impact on people's lives. When you look at the actual metric of sharing, that's meaningful. But someone actually doing something is more meaningful. And that led to making more and more food content. We set up a test kitchen. BuzzFeed Food, which is on BuzzFeed's site, started having some huge successes with videos that got tens of millions of views that were made in our test kitchen. And our video team in LA thought "Hey! Look at the success their having, lets learn from that and make a video property called Tasty that focuses entirely on distributed content and makes content for Facebook video primarily." They got better and better at making food videos and have built a massive page. And now, BuzzFeed Food and Tasty are two of the largest media channels on Facebook and they are both food channels.
Carlson: And then Top Knot comes out of this as well. Top Knot by BuzzFeed is it also done by the video team in LA?
Peretti: It's a collaboration between New York and LA.
Carlson: Ok. So what is Top Knot and how does that work? Top Knot is one month old and it's suddenly on the list of most popular pages.
Peretti: Yeah it's fashion. We realize that there was ... one piece of this is because Facebook is so global and BuzzFeed is so global - we are finding that there are opportunities to make very visual content that appeals to a large global audience. And food, fashion, DIY, design and some of those areas are really promising places.
Carlson: So the speed at which you spun up these new brands - Tasty and Top Knot - it's remarkable. What is it like from an organizational standpoint? Do you hire a whole team to do these things? And like "Oh! That's going to be our Tasty team!" Or do people do new work?
Peretti: We have a big pool of generalists who are constantly experimenting. We then find that people get a crush on something - you know when you get a crush on a person you don't know that much about them, you're sort of obsessed with them, you want to spend more time with them - we have people on our team who have a crush on a platform, like Facebook video.
Or they have a crush on food videos, or they have a crush on some area and they go from being a generalist to someone who just gets obsessive about one initiative. And we're seeing more and more that those are the ways that we really break into something big, is when there's this relatively small group that has success and then says "I wanna go down a rabbit hole and figure out how does this stuff work." And that team or that pod will make really amazing work.
Carlson: So you say to people, "This person is having a lot of success and they are clearly obsessed and gaining a lot of traction, just keep going." ?
Peretti: Yeah. Yeah for sure.
Carlson: We're also experimenting with Facebook video. You can get very large, very quickly. The money isn't there yet, obviously. It's a lot of people throwing money to get there. To get a lot of views ... but so far you're not allowed to monetize the platform. Facebook will pay you for suggested video, the rates are really low. How do you rationalize it?
Peretti: Facebook, a year ago, didn't have a video product at all. And now they are generating billions of views for us and lots of views for many other publishers. Facebook's "superpower" is continually improving and getting better over time. So they'll launch a product and they won't see that as an end point. They'll launch video and be like "Wow! That got huge user engagement! Ok now lets try some ways of monetizing with this suggested videos product. Lets try to figure out other ways to incentivize partners to make great content for Facebook." So I think over the next few years, you will see Facebook evolve their product and make sure that people who know how to make great video and social video and mobile video will make it for Facebook's platform. And then we need to wait and see how they develop.
Carlson: Has "wait and see" ever not worked out?
Peretti: It sometimes happens. I think it happens when the strategy of the platform doesn't match the strategy of a publisher. Sometimes there's a platform that says, "We don't want a bunch of publishers making content, we want it to be personal. Or we want it to just be celebrities doing personal updates," or something like that. But I think in Facebook's case ... the Facebook News Feed is becoming a very dominant way for people to consume news and information and video and images and text ... and 3D video, which we have been making for Facebook. I think if it's more expensive to make content, and the only way to make people afford to produce this kind of content is to incentivize them or allow them to build a business. Facebook will figure out ways to allow people to have good businesses.
Carlson: So you've been reading about the early Hollywood Studios. We talked about a book that you and [Ze] Frank have been reading. Same time?
Peretti: Same time.
Carlson: A little book club?
The place where I find the best comps is looking at the early days of media businesses. And it depends, newspapers were over 100 years ago, magazines 80 years ago, studios about 100 years ago to 60 years ago ... there's these spans where you see people trying to figure out how to build a business around new technologies that didn't exist before. Where all of a sudden you can show moving pictures and then all of a sudden you can show moving pictures with sound, and how do you end up building a business? And if you look at the early studios, they were building global media businesses almost 100 years ago and the model really worked because of the distribution that they built out with theaters and all different countries, and they would have first-run theaters where tickets would cost a lot more and it would slowly move down to less desirable theaters and sometimes take a year until you could see the movie for a discounted price. And so they were figuring out a lot of things that are all still influential on the way the studios work today.
Carlson: Is the analogy for you - they were distributing these films through this set of theaters, and that's kind of how we distribute through Facebook?
Peretti: Sometimes you can over analyze, but I think the big thing that we see is that having fixed costs and building out a globally cross-platform network is something that BuzzFeed is very focused on. So we are able to make content and that content can be huge on Facebook, can be in our Snapchat Discover channel, can be translated into other languages, and we get the benefit of creating content across a global, cross-platform network.
Our national security reporter had a scoop about the books that Osama Bin Laden had in his library and that story was a story that we published in the US, but he had all these French books and was a Francophile, and so then she could co-author an article in French for our French edition. And so having a bigger network allows us to invest more in reporting, invest more in entertainment. Our video about making Nutella brownies was huge globally, and we saw it in Brazil, Germany, France - we can invest more in making content like that if we know that it has this larger international footprint. And we can invest more in content if we know that it can go on multiple platforms besides just BuzzFeed's site. It can work on Facebook, it can work on Youtube, it can work on Snapchat, it can work in different places.
To bring it back to the studios, that actually was very similar to what we saw with the early studios, where first they would make a movie and show it in their own theaters, then they realized "oh, we need other peoples' theaters too to make additional revenue." And then they said "oh, we need theaters in other countries" and then there was a period where they realized - at first they said television doesn't matter - that television became a way to spend more on movies, because if you made a movie and showed it in theaters, then you can sell it to television networks and they use that as programming. And so all of those realizations, that you need to be a bigger, more global, more cross-platform network, allows you to invest more in content. These are realizations that people are having again in the digital space where they are seeing the same benefits of being both global and cross platform.
Carlson: I'm curious a little bit about the blocking and tackling of fixed costs for a story going to other platforms. Do you have a person that is a specialist for Facebook or Twitter or whatever? So a story is made. How many people are responsible for distributing it across different platforms? I'm sure it's different with every case, but generally?
Peretti: We have some great examples of this. And we are building out more operational capacity to do this.We have a global translation and adaptations desk, where stories can go and get translated into different languages and also change and adapt it for different markets. So that's a piece of it. If you look at our Snapchat Discover channel - one thing I think is very interesting is that it has native content made just for Snapchat. That a team in LA is making. And then it has a lot of the best things from other platforms. And so it allows us to make something that we wouldn't be able to make if we weren't on many other platforms, but it still has things that are unique for Snapchat. So I think it's a combination. I don't think it's the right "once-read everywhere model" ... it's the "have a creative idea and a spark, make lots of things. See which ones really work and then pick the things at the head of the tail to adapt to different platforms and different markets."
Carlson: Are you worried about focus? When you are trying all these different experiments, how do you make sure you are doing the one thing you do great, well?
Peretti: I think what we do well is do a lot of experiments and learn what works. And then expand on the things that work.
And I think when you look at things like Tasty, it's an example of going from a core of generalists doing experimentation to then having a single purpose to really focus on and expand. And we should be able to build more interesting businesses and initiatives and brands because of all of the knowledge and learning we have from the cross-platform global network.
Carlson: The last time we talked, a few months ago, you mentioned that you read a book about Ted Turner...
Peretti: Yeah there's this book "CNN: The Inside Story" which was a best-seller which is now out of print, so it's easy to get used. And it is about the early days of CNN when it was a startup, and they were planning to spend something like $30 million in their first year to be on television 24 hours. And the networks at the time were doing a half-hour nightly news show for $300 million a year. So people thought it was crazy; the costs were so much lower. But they figured out how to use the medium to do things you couldn't do in broadcast. So they could go live to an event and not have to interrupt the sitcom that was scheduled to be on or the sports game or whatever. And they could do a different kind of coverage and [it allowed] them to grow and eventually they ended up spending more than the networks do or as much. So it was an interesting story of disruption.
I think people often miss the fact that things often start in a swashbuckling like low cost just get it done kind of way, even when they grow into these iconic brands.
Actually, search YouTube for the first broadcast of ESPN. It is one of my favorite videos. You like watch the first broadcast of ESPN and it's like a guy sitting there like, "Welcome to the New England Sports Network! We have softball on later today and we're going to bring you all the exciting ..." It's like, you know, the sets and everything ... just watch it. I'm like describing a video ...
Carlson: So NBC Universal just invested $200 million in BuzzFeed because they want to learn about what you do. What are they learning about you? I mean, how does that actually work?
Peretti: I think the learning is really two ways. Because I don't know that much about how television film works today, but 50 years ago, yeah. So we learned a lot from them seeing how they make and distribute and market content. And I think, hopefully, they've learned some stuff from us as well. And then in a few areas we are finding some ways in which we can collaborate and actually work on stuff together. Which I think will be pretty interesting around the Olympics and some other areas.
Carlson: You do scripted stuff in LA with Frank's team, if one of those gets popular, will you be like "oh, maybe we'll sell it to Amazon"?
Peretti: We just sold a series directly on iTunes, this "Violet" series - "You Do You" - and it was number one for five days in the iTunes store, ahead of the Kardashians so it was pretty cool, and some of the places where we start with shows will not be "put it on television" it will be more "make something."
"Violet" was very interesting. It came out of a lot of generalists making content, then having them become characters, and then those characters begin to live in a character universe, and there start to be stories and fans following along with their lives, and then we went from single videos to a collection of 12 videos and made a series with more of an arc to it, and then released that on iTunes first, and then also online. So you could wait and see it for free, and then you could buy it if you couldn't wait.
Some of that actually goes back to how windowing should work in the digital age. And the default is put everything everywhere always, and that tends to be the way we operate. But I think there are some interesting opportunities, just like in the early days of the studios, where they said "here's what first run means, here's what second run means, here's when we go wide and move it to another platform" - so I think there are possibilities there that people are going to figure out over the next few years.