Digital media giant BuzzFeed recently announced it would be laying off some of its workforce at Complex Media, saying its commerce business has decreased due to users not being as actively engaged on Facebook as in the past.
“At this point in the quarter, we continue to see audiences spending less time on Facebook,” BuzzFeed CFO Felicia DellaFortuna said during a company earnings call on Tuesday, March 22.
Complex Networks is a New York City-based media and entertainment company for youth culture.
The shift in audience time away from Facebook has “disproportionately impacted” its commerce revenues, DellaFortuna added, according to CNBC. She also said she expected the trend to continue, noting the company would have to shift its strategy to avoid such declines in the future.
“We are leveraging our cross-platform distribution network to extend our commerce business to the faster-growing platforms, thereby reducing our dependence on any one platform over the next couple of years,” DellaFortuna said.
BuzzFeed, which went public in 2021 through a SPAC deal, said it plans to “accelerate profitability” by reducing its workforce, DellaFortuna said.
BuzzFeed founder Jonah Peretti confirmed DellaFortuna’s words about the upcoming layoffs, announcing that several editors were leaving for other endeavors, including Editor-in-Chief Mark Schoofs.
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Peretti said the downsizing would primarily impact BuzzFeed video and Complex editorial with Samantj Henig taking over as the interim editor-in-chief.
“She and I will talk to BuzzFeed News later today about our plans to position BuzzFeed News to thrive in the current media ecosystem, accelerate its path to profitability, and become a stronger financial contributor to the overall BuzzFeed, Inc. business,” Peretti wrote in a memo to staff.
“This means that BuzzFeed News will need to get smaller, which we have reached out to discuss with the union–and to prioritize the areas of coverage our audience connects with most,” Peretti continued.
While BuzzFeed’s commerce revenue decreased, the company reported gains in content revenue.
Over-reliance on Facebook for commerce is a business strategy that The Moguldom Nation founder Jamarlin Martin has advised against.
“The days of Facebook as a reliable traffic source are over. Facebook will always do what’s best for next quarter’s earnings at the expense of publishers, society, and whatever else is in the way,” Martin wrote in a 2017 op-ed.
A proven success in starting and scaling digital brands, Martin advised publishers to use other business-savvy solutions to drive revenue.
“Everyone can use their imagination to think of new ideas and initiatives that cost the business a lot of money,” Martin said. “Try instead to imagine cutting your expenses 30 percent with a better business design that allows you to focus on a few things better than anyone else.”
PHOTO: Jonah Peretti, founder and CEO of Buzzfeed, speaks at Advertising Week, Oct. 4, 2012 in New York. (Photo by Jason DeCrow/Invision for Advertising Week/AP Images)