Tasty's Licensing Partners Sold More Than $250 Million of Branded Merchandise in 2020

Tasty, the food sub-brand from BuzzFeed, wants to twist its commerce loop into a commerce pretzel, double and triple-dipping revenue by monetizing every stage of the culinary process. The publisher recently announced its latest brand licensing venture: a collaboration with General Mills to produce four dry meal kits, a Tasty-inflected version of the iconic Hamburger Helper franchise, which celebrates its 50th anniversary this year. As financial belt-tightening has prompted publishers to expand into novel revenue streams, commerce has presented a particularly appealing route, especially for lifestyle brands with large, active audiences like Tasty. The four meal kits draw inspiration from Korean, Mexican, Mediterranean and Indian cuisines, and all include a pasta or starch and two sauces, with meat and additional veggies sold separately. They are available in regional outlets now and will join nationwide chains this summer. These additions will grow Tasty's ever-expanding roster of 250 licensed products, a revenue line that generated more than $250 million in global sales in 2020, according to Eric Karp, BuzzFeed’s svp of global brand licensing. Advertising remains the key revenue driver for the publisher, but Karp called licensing a "fast-growing" segment. The company declined to offer financial specifics. Over the past three years, total Tasty revenue from licensed goods has risen 30%, on average, thanks to strategic partnerships with companies like Walmart, McCormick, Nestlé and now General Mills. "The question was: 'What does Hamburger Helper look like for a new generation?'" Karp said. "It turns out, it's not about stretching a protein to feed a large number of people. It's the notion of a dry meal kit, because meal kits make sense to this generation." Licensing, almost a pure money-maker Licensed products serve three functions for licensees like Tasty: They generate revenue, protect brand trademarks and function as a marketing tactic. Although the meal kits will retail for only $2.99, Tasty takes on virtually no expenses in the venture yet garners a royalty payment for each sale made, making the collaboration an almost pure money-maker. Neither party shared the details of the royalty arrangement. In return, General Mills receives three main benefits: a pop of relevancy, a bump in sales and the exposure of a two-year media plan, said Ciarán Coyle, president and COO of the global brand licensing agency LMCA. The cultural cachet of partnering with a youthful brand like Tasty will help General Mills remain germane to younger customer cohorts, according to Coyle. BuzzFeed Launched Tasty as an Experiment. It’s Turned Out to Be a Stand-Alone Star "Partnering with a cool brand is good for General Mills, because it makes them relevant," Coyle said. "It gives them some credibility with a community that otherwise would not really consider them as a brand. These kinds of revitalizing collaborations go across various industries—look at Madonna in the music world, for example. She maintains relevance by collaborating with up-and-coming artists." Given that Tasty also routinely promotes its branded products in its videos, General Mills will also enjoy an increased brand awareness among BuzzFeed's food aficionados. In the world of food media, Tasty dominates in terms of reach, where its 40 million Instagram followers dwarf the breadth of competitors like the Food Network and Bon Appétit (11 and 4 million followers, respectively). Eight in 10 people who watch a Tasty video have also cooked a Tasty recipe, according to Karp. Together, these figures mean that a product's inclusion in a Tasty dish has a high likelihood of translating into real-world sales. Plus, for Tasty, its move into licensed goods also serves a valuable marketing function, as it represents a “merging of the analog and digital worlds.” “We are massively present in Walmart, the world’s largest grocery chain,” Karp said. “Between our online reach and our in-person presence, Tasty really begins to feel omnipresent.” The dry meal kits reflect pandemic-era deal-making Tasty and General Mills began working on this collaboration in early 2020, shortly before the pandemic struck. After Covid-19 upended the consumer landscape, the two companies realized the crisis had created an opportunity for products that could help amateur cooks prepare at-home meals that helped break the culinary monotony of lockdown. "We had been interested in partnering with Tasty for some time," said Luke Niethammer, brand manager at General Mills. "When the pandemic hit, and we saw how consumers responded by returning to preparing and making more meals at home, we felt even more confident that a partnership would allow us to bring innovative new products to the market to meet consumer needs." The pandemic also drove some companies to freeze new licensing projects, Karp said, though the venture between General Mills and Tasty squeezed in just under the deadline. As a result, Tasty found itself poised to release a timely new product when few others could. The deal has a two-year lifespan, but Tasty always aims to keep its products on the shelf. The brand avoids open-ended agreements, but it deliberately leaves open the possibility for success-based renewals, Karp said. "The last thing we want to do is retire bright products," Karp said. Correction: The original headline incorrectly stated that Tasty's branded merchandise generated $250 million in revenue. Branded merchandise generated $250 million in sales. 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