In a bold move to revamp the social blogging landscape, WordPress.com owner Matt Mullenweg recently announced a major reorganization of Tumblr’s workforce. Automattic, the parent company of both WordPress.com and Tumblr, is reallocating 139 of Tumblr’s staff to other projects within the company, a step deemed necessary due to Tumblr’s ongoing financial struggles. This development follows Automattic’s acquisition of Tumblr from Verizon for $3 million in 2019, a stark contrast to Yahoo’s billion-dollar purchase years earlier. Despite the acquisition’s bargain price, Tumblr continues to grapple with a yearly loss of $30 million.
Staff Reallocation and Future Strategies
Mullenweg detailed the reorganization during an AMA session on his Tumblr blog, revealing that staff changes will take effect on December 31, 2023. Affected employees, collectively known as “Bumblr,” will have the opportunity to rank their top three preferences from various Automattic projects, including WP.com, WooCommerce, and Pocket Casts. This reallocation aligns with Automattic’s objective of assembling the world’s leading open web tech team, even as it involves laying off some staff members.
The Monetization Conundrum
Tumblr’s monetization remains a central concern. With just 0.2% of its 11.5 million monthly users subscribing to its services, Mullenweg emphasized the need for increased subscriptions. He proposed creative solutions like gifting subscriptions and supporting advertisers to enhance Tumblr’s financial stability. Despite the low uptake of the Tumblr Supporter badge and challenges with physical goods from TumblrMart, Mullenweg remains optimistic about finding effective monetization strategies.
Advertising and Technology Innovations
Advertising continues to play a crucial role in Tumblr’s revenue model, with programmatic ads contributing significantly. Mullenweg discussed the potential of self-serve ads and new advertising formats to attract brands. He also expressed interest in leveraging new technologies, including AI, to improve content migration to WordPress.com and streamline Tumblr’s operations.
Focusing on Core Strengths
Looking ahead to 2024, Automattic plans to concentrate on the most beloved aspects of Tumblr while discontinuing underperforming features. The focus will be on honing user-loved content, such as high-resolution images and streaming video, with the support of Automattic’s video technology through VideoPress.
Automattic’s strategic decisions for Tumblr signal a new era in social blogging. The shift in workforce allocation, focus on monetization, and exploration of new advertising and technology avenues indicate a significant transformation. Mullenweg’s vision for Tumblr involves not just stabilizing its finances but also reinventing its role in the digital community. As Automattic navigates these changes, Tumblr’s journey could redefine the landscape of social media and content creation.