Bryan Goldberg isn’t shy about his intention to buy more media assets, but the selection process would be a lot easier if there were more options that reminded him of The Zoe Report.
“Other deals that we’ve done have been great and they all bring valuable things to the equation, but The Zoe Report, if I could find 10 more I’d snatch them all up,” Goldberg said.
He’s effusive about the brand, which his Bustle Digital Group acquired from celebrity stylist and entrepreneur Rachel Zoe and her husband and business partner Rodger Berman just over a year ago, both of whom are now shareholders in the business. As Goldberg put it, the numbers are better than expected, and while the company would not disclose the sale price, given the excitement, it seems like it was probably a pretty good deal.
“It’s both a model and template for what we’d like to do in the future, because it’s just been so successful for us,” Goldberg said. “The speed and the depth of the success is pretty remarkable.”
First-quarter revenue for the newsletter-turned-site is up 62 percent year-over-year and total revenue for 2018 grew 30 percent. Monthly uniques for May grew to 3.1 million from 2 million last year and The Zoe Report has helped Bustle Digital Group make major inroads with fashion and retail advertisers, revenue from which is up 109 percent and 15 percent, respectively, year-over-year for the entire group. While Bustle Digital Group would not break out revenue for The Zoe Report alone, it’s said to be running at a profit, and the digital group as a whole is projecting revenue of $100 million in 2019, up from $75 million last year.
As for Zoe, she admitted to being wowed by the numbers. She’s often asked by people in a wary tone how the site is going and always has the same answer: “Honestly, it’s the best thing I’ve ever done.”
“There comes a point where you have nurtured something as much as you can and you have to face that moment where you say, ‘OK, this needs to live on in a different place to live its best life.’”
Zoe compared the decision to sell the site after running it for nine years to a much earlier decision she made to give her dog to her mother when she and Berman made the move from New York to L.A. as her career as a celebrity stylist and fashion personality was taking off.
“My mom said this dog will get eaten by a coyote, you’re unfit dog parents because you travel so much, and we said ‘Ok.’ We faced the reality and my dog literally lived to be 18,” Zoe said laughing. “She lived her best life and that story is literally The Zoe Report.”
There are plenty of plans to expand The Zoe Report into more events (revenue from influencer-heavy Zoeasis at Coachella grew 40 percent this year) and shopping (there’s some new AI-driven product coming this summer) and especially use it as a pathway for fashion, retail and beauty brands to come into Bustle (85 percent of the site’s advertisers had no presence in Bustle before the acquisition), but the company is perfectly happy to keep The Zoe Report as a smaller site with a focused audience. Goldberg and other Bustle executives were frank in that there is no expectation for the site to hit 30 million uniques. It’s a “boutique” site and they intend to keep it that way, not least because it fits in with Goldberg’s plan for BDG to be an umbrella for 15 or more similarly sized media brands.
“There are some media companies that inspire us, but when I think of some of the most successful companies LVMH is one of the first that comes to mind,” Goldberg said. “What’s so amazing about the LVMH model is it’s fundamentally about scaling the concept of the boutique, taking brands that don’t need to be gigantic and scaling them at that level. Until now, it’s been really unclear, the role of a boutique publication in the modern digital landscape. My hope is we’re writing that answer.”
Advertisers seem to like it. Jason Wagenheim, Bustle Digital Group’s chief revenue officer, said The Zoe Report’s ad base has tripled, thanks in no small part to going from a selling team of three, led by Zoe’s sister Pamela Glassman, to almost 30. Glassman now leads the larger group as head of sales for The Zoe Report and Bustle Digital Group.
“The other thing, The Zoe Report mathematically could never sell deals beyond a certain size because they were only 1.5 million, 2 million uniques at the time,” Wagenheim said. “With [other BDG brands] Bustle and Elite Daily, we use The Zoe Report as a lead editorial content or experiential or branded work and we distribute that through BDG, if it makes sense.”
The Zoe Report is also in a prime position, with its focus on shopping and fashion recommendations and its email list of 2.5 million for its newsletter, to develop the “lower funnel” placements that directly create purchases, which more and more brands are looking for, according to Wagenheim. To that end, BDG is working now on developing either content or a vertical that is more shoppable and moves beyond affiliate links.
But overall, BDG is in “hyper growth mode” and TZR is now sitting as “the 10 on the 1 to 10 benchmark,” according to Goldberg. As one of the only media companies out there that’s actively looking to acquire brands, while so many others are looking to offload them, Goldberg said he probably looks at three possible acquisitions a week, the curation of which is being led by Chris Altcheck, the cofounder of digital news site Mic that BDG just acquired from the brink of extinction.
“Other deals may be bigger. Other deals may capture the imagination of the press more than this one, but it’d be very hard to find pound for pound more successful a deal than The Zoe Report,” Goldberg added. “It’s stuff like this that’s really driving the company.”
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