RTL Group is buying itself more video content by acquiring StyleHaul in a deal that values the lifestyle-focused YouTube network at $151 million.
“StyleHaul is an excellent fit with our digital portfolio, complementing our recent, technology-focused acquisitions BroadbandTV and SpotXchange,” said Anke Schäferkordt and Guillaume de Posch, co-CEOs of European TV and radio company RTL Group, in a statement.
StyleHaul brings together 5,000 content creators, who distribute their content across YouTube. It attracts 900 million views a month. Forty percent of the top 500 fashion and beauty channels on YouTube are part of StyleHaul.
The deal follows similar acquisitions between established content companies and mutli-channel network companies using existing platforms like YouTube.
“Traditional media companies are recognizing the MCNs [multi-channel networks] attract good, large millennial audiences,” said Jim Nail, principal analyst at Forrester.
In March, Disney bought Maker Studios ($500 million for five and a half billion views a month). In September, Otter Media, a venture between AT&T and the Chernin Group, bought FullScreen ($200-300 million for four billion views a month). Based on these three acquisitions, it seems $100 million roughly equals a billion YouTube views per month.
The deal adds to RTL Group’s existing multi-channel network holdings. In 2013, it acquired a majority stake in BroadbandTV, the fourth-largest multi-channel network on YouTube. It owns a minority stake in DiviMove, a European multi-channel network.
“Advertisers tend to stay away from consumer-generated video, but with a Disney or an RTL behind them, all of a sudden they have more credibility,” Nail said. “It’s reassuring to marketers you have a big traditional company overseeing [MCNs] and taking issues of viewability and fraud seriously. These big companies understand what advertisers want and expect to get out of their advertising.”
The deal helps RTL achieve additional scale in online video. StyleHaul adds to the content side, and video SSP SpotXchange on the technology side — though it’s unclear how the two might work together.
RTL Group is growing its own video views organically and through acquisitions like StyleHaul. For the full year of 2014, it projects a total of 40 billion video views, double the total for 2013.
With 900 million views a month, StyleHaul would contribute over 10 billion views to that 2014 total.
CPMs from video views will be only one piece of the monetization strategy. Native video, or branded content, is a key part of StyleHaul’s monetization strategy, attracting such advertisers as Macy’s, Maybelline, and L’Oreal.
RTL already owned 22.3% of StyleHaul. The $107 million acquisition brings the total to 93.6%. It will invest an additional $20 million into the young company’s growth as part of the deal.
StyleHaul first came on the scene in 2011, founded by CEO Stephanie Horbaczewski. Its CRO, Alison Kennedy, hails from Glam Media.
