TheStreet.com is carrying through with its mission to extend coverage beyond dry investment-related content to attract broader audiences and more non-financial ad dollars. The company reported a 134 percent jump in full year 2007 revenue from non-financial advertising over 2006. And a recent acquisition of Promotions.com, in addition to the launch of a new mainstream consumer-aimed site, Mainstreet.com, promises to spur more of the same.
Ad dollars from non-financial advertisers made up 44 percent of the publisher’s ad revenue in ’07, up from 27 percent in ’06. “I expect that non-financial advertising will comprise 50 percent of total advertising revenue in 2008,” said Tom Clarke, CEO and Chairman of TheStreet.com during today’s earnings call with investors. Clarke later mentioned that the firm’s ability to attract advertisers outside of the endemic financial vertical has been a concern of company observers in the past.
More than 50 percent of the company’s ad revenue came from non-financial advertisers in Q4 2007, up from 33 percent in the same period of 2006. Auto, travel and technology advertisers fueled that growth, said Clarke. The firm added 24 new advertisers in 2007.
Fourth quarter 2007 ad revenue hit $6.8 million, 43 percent more than Q4 ’06. Total ad revenue for 2007 reached $22 million, the highest ever for the firm, up 42 percent over 2006.
“Now we can attract an even more diverse group of advertisers,ÃÂ¢Ã¯Â¿Â½Ã¯Â¿Â½ Clarke said. TheStreet is hoping its ability to bring in a wider array of advertisers beyond the Visas and TD Ameritrades of the world will be bolstered by the launch this month of MainStreet, a free site pairing celebrity news with personal finance information. The site is an odd concoction of glitzy celeb gossip and financial tips, not only lending itself to a more common consumer audience, but to optimization for the search engines people use to seek out entertainment content. One article has the headline “Naked Lohan Makes Us Think of Taxes” and another hinges a story on child support and family planning on news of Flavor Flav preparing for an eighth child.
Toyota is an advertiser on the site, promoting its newest Corolla in a variety of display units. The automaker “wanted to touch more of the mass consumer market,ÃÂ¢Ã¯Â¿Â½Ã¯Â¿Â½ said Clarke, noting that the “majority” of MainStreet visitors are not users of TheStreet.com.
According to Ashman, the firm’s revenue per thousand impressions (RPMs) increased 31 percent in Q4 2007 over Q4 2006, reaching its highest point ever. The company has focused on reducing poorly monetized pageviews “to drive RPM up,” according to CFO Eric Ashman, who told investors the firm is also increasing non-IAB standard ad inventory such as custom sponsorship opportunities.
With more advertisers and custom offerings comes the need for more sales staff. The company plans to build its 20-member sales team up to 25 people, according to Clarke. “We really look at that as revenue generation,” he said.
In addition to re-launching TheStreet.com and stock information site Stockpickr to create new options for advertisers, the firm recently acquired Promotions.com, a former property of NBC Universal and Corsis. The Promotions.com business provides TheStreet with a technology platform for content management, consumer registration, e-commerce and advertiser promotions intended for lead generation purposes.
Financial site competitor Forbes.com has also branched out its ad offerings through a deal with lead gen service Matchpoint to run form-based ad units on its site, allowing readers to connect with companies advertising online banking or credit card offers.
Promotions.com brought in $2.7 million of interactive marketing services revenue in the fourth quarter for TheStreet. Total marketing services revenue which included Promotions.com was $9.5 million, up 99 percent over the $4.8 million collected in Q4 2006. Marketing services revenue for the year hit $27 million, 75 percent higher than the $15.4 million reported for the full year 2006.
Overall, the company seems to be on its way to achieving its stated goal of becoming less reliant on subscription revenues. In 2007, marketing services made up 41 percent of total revenue, up from 30 percent in 2006. Marketing services growth “was driven by strong performance of the advertising business as well as the addition of Promotions.com,” Ashman said.
As for uncertainty in financial markets and their impact on financial advertiser spending, Ashman was confident. “We remain optimistic the strategy we have in place… will leave us well positioned to expand our networks… and attract new and diverse advertisers to our properties,” he predicted.