BuzzFeed CEO Jonah Peretti released his annual letter to shareholders on Monday, outlining his plan to transform the flagship BuzzFeed publication into a technology and media company driven by artificial intelligence (AI).
The shift to AI is reminiscent of the previous “pivot to video,” which was not particularly successful for most companies.
Peretti had previously highlighted the potential of short-form video and creator networks, but this strategy did not yield strong business results.
Facing challenges such as declining referral traffic and changing audience behaviors, Peretti believes BuzzFeed should focus on its platforms to drive traffic and explore AI chatbots as a new content format.
However, the sustainability of this approach for a digital publisher remains uncertain.
Regarding referral traffic, Peretti explained that BuzzFeed, which once heavily relied on Facebook for traffic, now generates the majority of its referrals internally.
This shift reflects the broader trend of declining Facebook referral traffic and its impact on BuzzFeed’s business model.
Peretti sees generative AI chatbots as the future of digital media, emphasizing their potential to enhance audience engagement and create interactive content formats like quizzes and games.
He believes this approach will differentiate BuzzFeed from other publishers.
Peretti also addressed the power dynamics between tech platforms and publishers, noting that platforms benefit from creators’ content but do not adequately support media companies.
Despite efforts to collaborate, platforms prioritize commoditized content and low-cost creator labor.
In resetting BuzzFeed’s strategic direction, Peretti chose to focus on becoming more of a tech company than a traditional media or content company.
He believes that scalability, technological leverage, and AI are key to future success, drawing parallels to successful tech companies like TikTok and Netflix.
He noted that both areas are high-margin, scalable, and tech-enabled, presenting opportunities for growth through the application of AI.
Peretti’s letter outlines a bold vision for BuzzFeed’s future, positioning the company at the forefront of AI-driven media and technology.
