HuffPo Rides A Profitable Wave Of Emotion

The Huffington Post has successfully marshalled a wave of emotion which connects it to a larger community of like-minded individuals. That’s a powerful business model.


There’s much to be learned from the astonishing growth of The Huffington Post over the last six years. The company co-founded by Arriana Huffington in 2005, is now expected to generate about $60 million in revenue this year, about twice as much as last year. It has 200 employees and it’s profitable. No wonder AOL said today it will purchase the company for $300 million in cash and $15 million in stock.

For AOL, the deal helps flesh out a strategy of content acquisitions that already includes a $40 million deal for the blog TechCrunch.

Those deals highlight the fact that AOL’s latest homegrown initiatives—the Patch local news network and the Seed citizen journalism effort—have yet to really take off. AOL’s other sites such as DailyFinance (full disclosure: I am a DailyFinance contributor) aren’t posting Huff Post-like numbers either.

Meanwhile, Huffington Post has 25 million unique visitors a month, and its stories generate thousands of comments. The AOL deal gives it an eye-popping valuation. Consider for a moment that the entire New York Times company has a valuation of $1.6 billion. Huffington Post could well surpass that valuation in a few years, which would be an astonishing turn of events.

Why has Huffington Post been such a success? Part of the reason is that it was built from the ground up for the Web. The site is tightly integrated into social networks such as Facebook and Twitter, which serve as mediums for broadcasting comments on Huffington Post stories.

But those Web tools aren’t the engines of the site’s growth. They are merely the transmission. If we pull up the Huff Post’s hood and look for the engine, we find the equivalent of a fully blown 12-cylinder monster that is fueled by high-octane emotion. That is the rocket fuel that fires Huffington Post.

Much has been made of Huffington Post’s leftward-leaning editorial bent. The nature of its politics is pretty much beside the point. What matters is that Huffington Post has a point of view, and that it connects with a large community of like-minded individuals. In that respect, it’s similar to Fox News, Glenn Beck and the Daily Show, which also grew at a rapid pace because they stepped into a river of sentiment and were swept away in the current. And they all came into being at a time of war, economic instability, political division and other issues that aroused public sentiment.

Did you ever go to the beach and experience the power of the ocean? The current can take you farther and faster from shore than you might think possible. The Huffington Post is like that. Most media platforms, be they old or new, print or online or TV, are like swimmers at the local pool, moving along under their own power. Even the most powerful swimmers in the group fail to move as fast as the Huff Post, riding the breaks on a surf board.

If you want to see the power of emotion in driving traffic on the Web, take this simple test. Look at the stories that lead the news coverage at the New York Times on any given day. Then compare that list to the daily compilation of the most popular or most emailed or commented-upon stories. The two lists rarely overlap. At this particular moment, the lead news story at the Times is about the crisis in Egypt. But the most popular story is about business opportunities in a greying population, and features a wearable device created at MIT that allows the user to feel what it is like to live in the skin of a person much older. The story taps into people’s psyche on a level that even an important news story rarely does.

Huffington Post taps into the power of such emotions, which can run the gamut from political to personal subjects and can exist across the ideological spectrum. Even when it covers the news, Huffington Post does so in a way that connects with the reader in an emotional way—notice the 60-point headlines and the populist takes on stories such as the banking crisis, which often conveyed a “can you believe what those swindlers are up to now?” bewilderment.

This is not to say that there’s no place in the media world for information and data. There is, as the growth of Bloomberg clearly demonstrates. But most of the truly professional providers of information are so advanced and specific that they can charge for their content. That is why financial sites run by AOL and Yahoo have trouble competing. Data and information often wind up as paid content, while the world of free online content is built on viral stories that connect with readers at an emotional level.

During the year, Huffington Post’s success has fed upon itself. Its growth has swelled the value of its privately held shares and its profits, which have created a currency to attract top level talent from Newsweek and the Times.

AOL CEO Tim Armstrong is stepping out of Arriana Huffington’s way and giving her full editorial control of the combined sites. The success of the acquisition may depend upon whether she can find ways to help AOL’s other projects such as Patch and Seed tap into the currents of emotion that exist in all communities.