The New York Times has acquired Santa Monica’s HelloSociety, a social media marketing agency, for an undisclosed amount of cash.
HelloSociety sells endorsements from a network of independent social media stars on platforms such as Instagram, Pinterest, Vine and YouTube. The company was founded in 2012 and was incubated within Science Inc. of Santa Monica.
The New York Times will integrate HelloSociety’s digital tools and social media stars into T Brand Studio, its internal branded content agency, which launched in 2014. Revenue from T Brand Studio has doubled over the last year, said Times Chief Executive and President Mark Thompson, in a statement.
While the newspaper’s use of branded content, also called native advertising, has been praised as an innovative form of advertising, the medium also can be quite expensive to produce, limiting its appeal to advertising clients and contribution to Times revenue.
“Some of these newer formats may generate lower margins than traditional desktop display advertising,” the New York Times wrote of branded content in a recent filing with the Securities and Exchange Commission.
Lower margins on in-house produced native advertising appears to be one reason for the New York Times acquiring HelloSociety’s network of social media stars. With an expanded distribution network, the paper could better justify the cost of producing original branded content.
The New York Times said it will also add HelloSociety’s social media stars into its branded content production efforts, expanding the number of services that its advertising clients can access.