I have written before about the growing traffic of the CPG players web properties as they start to embrace digital ad solutions more.
AdAge has an article about OfficeMax and their digital site they launched for the holiday season in ‘06. The site ElfYourself attracted an astounding 26.5 Million visitors during the holidys. The site enables you to upload a pic your selfself and paste your face on a dancing elf body.
According to Anne Bologna, president of the agency that created the campaign, in its second year of existence the site had a 10x increase in traffic and 123 Million elves created.
These are pretty remarkable numbers. Just as with the CPG guys, its impressive to see big brands be able to leverage their vast audience and drive what adds up to a TON of traffic when measured against the average consumer site.
When they are valued, especially in VC/investment scenarios, consumer internet sites typically garner most or all of their evaluation on the number of unique monthly users. If you have created a site that is getting 500K-1 Million visitors, and have ANY sort of revenue model, including the dreaded AdSense only even.., you have a site that is worth some moula.
This brings up two questions in my mind.
1) If a consumer site with 1 Million monthly visitors is worth, lets say a $10 Million evalutation, and they are providing some random service like videos, address book, calendar, whatever…, what is a product/brand site worth that has the same amount of traffic?
2) Given the rediculous aggregate traffic that product/brand sites are starting to generate, what are some new business opportunities for these companies to leverage their audience and make increased side income through their web properties.
For #1 who knows.., a handfull of the valutations on startups are B.S. in my book, so who knows what a product/brand site is worth, but it has to be something. For #2 I think there is HUGE potential for these companies to make incremental income per customer/user on an anual basis.
Lets say I am a company with a brand website that gets the 1 Million users per month. If I can figure out how to garner an incremental 10 cents per user/year…, which is absolutely nothing, than that means another $1.2 Million in revenue for just conducting business as usual while putting some together to generate that 10 cents on average. It could be banner ads (ughhh), PPC links (meerrgghghg).., affiliate solutions (not too bad).., or something new where I provide something of value for free in exchange for the opportunity for direct marketing maybe.
Something to keep an eye on this year as more companies increase their digital budgets to move more campaigns and efforts online.