Huffington Post
Huffington Post CEO Jimmy Maymann.
Usually when we read about huge agency/publisher deals, it's between media agencies and digital platforms - like Omnicom Media Group, which earlier this year signed a global deal committing to spend $100 million on Instagram.
So the HuffPo/Leo Burnett deal is an unusual one, not least because the alliance will see members of the HuffPost Partner Studio team - which creates articles, videos and imagery for advertisers - work in the ad agency's Chicago office several days a week to co-create paid-for content for its clients, that will sit on the HuffPo platform. To put it another way, Partner Studios is effectively HuffPo's internal creative agency that works for brands and media agencies and it's placing its creatives inside another creative agency.
And unusually for a creative agency, Leo Burnett (as well as participating clients) will also get access to proprietary data from the HuffPo's data engines that analyze real-time trends from all the publisher's social platforms. That is particularly useful as HuffPo is the most shared site on Facebook, according to analytics company NewsWhip. But it's also strange as creative agencies aren't often thought of as the number crunchers that have the staff or skills to analyze that kind of data.
For HuffPo the clear advantage of the deal is access to a client roster that includes some of the world's biggest spending advertisers like P&G, McDonald's and Samsung.
But HuffPO CEO Jimmy Maymann, tells Business Insider that if the deal was just about access to clients, he would find other ways to do that.
Instead, he explains that by partnering with a creative agency in this way, HuffPo can sit at the table with big advertisers far earlier on in their campaign planning process. He doesn't want branded content that sits on HuffPo to be a tag on at the end of a campaign, he wants it to be extensions of campaigns that live offline too, like Chipotle's Food For Thought push that ran as a section on HuffPo, but also as a broadcast TV show.
Maymann says: "[Content marketing] becomes very strategic if you are having discussions with the brand very earlier on. Then it becomes much more of a bigger investment than a sponsored listing - although there's still a place for that as well."
"We want to make sure there's enough money and time invested so we see really high engagement levels [with branded, paid-for content] that's not far off organic content. That's the great litmus test and it's already happening with some brands on HuffPo."
By signing a deal like this and embedding its own content producers right into the inner workings of Leo Burnett, Maymann said he hopes more big brands will start thinking about content in the same kind of "always on" way Red Bull has been marketing for more than 10 years.
"Not many agencies are set up to create the amount of content you need to be able to connect with your consumers. Weekly you need to be creating 10 to 20 pieces of content. We put out 1,600 stories a day, we have a good understand of what works," he adds.
Although they have signed a deal, it doesn't appear any money has changed hands between HuffPo and Leo Burnett. Instead Maymann says each company has set the other revenue targets. The exclusive partnership lasts a year, before the arrangement is reviewed.
HuffPo will be paid for the content it creates for Leo Burnett clients and any supporting ad space they buy across the parent AOL ad network. Leo Burnett will be hoping the deal will help it create better value for its clients, and ultimately boost the income it generates from them.
Sponsored content is a burgeoning industry, with marketers expected to spend $2 billion on the discipline this year, according to eMarketer.