ALLOY’S COSMOGIRL MAKEOVER
Byline: Valerie Seckler
NEW YORK — Alloy Online is on a deal-making roll this year and it just landed a big one: The multimedia teen content, community and commerce player on Aug. 6 is relaunching CosmoGirl.com, the two-year-old, Hearst-owned Web site that it has just finished redesigning, WWD has learned.
Under the strategic partnership with CosmoGirl, whose terms were undisclosed, Alloy also will host and provide advertising and marketing services for version two of the teen magazine’s Web site, and will incorporate content created by the CosmoGirl editorial team.
“We did the traditional thing and looked at various agencies as well as a number of teen players — the Bolts of the world — when we decided to redesign the Web site,” related Richard Wilkie, general manager of CosmoGirl.com. “We liked Alloy because we were impressed with their continued expansion, most recently their deal to acquire CASS Communications,” Wilkie added, in citing Alloy’s purchase this month of the Chicago-based provider of youth marketing services for $33 million, which included $9.7 million in cash-plus Alloy stock.
“We really liked [Alloy chief executive officer] Matt Diamond,” Wilkie continued, “and we thought Alloy understands teens and is going to be around, based on its financial position.”
Alloy’s database of seven million teens won’t hurt either. “We think with the assets we have and Alloy has, we can extend our reach,” Wilkie acknowledged of the project, which will provide links on Alloy.com to CosmoGirl.com and on CosmoGirl.com to Alloy.com. Hearst decided to make over the Web site because, as Wilkie put it: “It has done well and we saw potential to take it to another level.” CosmoGirl.com is pulling approximately 400,000 visitors a month, he estimated; Alloy draws about 1 million users monthly, according to Web ratings agency Jupiter Media Metrix. The CosmoGirl.com went live in July 1999, concurrent with the launch of CosmoGirl magazine, which, according to Wilkie, was the first time a magazine and ‘Net destination were launched simultaneously. The reason, he said, was simple: “If you’re going to launch to teen girls in America, you’d better be online.”
Alloy approached Hearst late last year, said Diamond, also a co-founder of the firm based in Silicon Alley. “We said, ‘Hey, let’s get to know each other; we have an audience of seven million teens.’ I believe this is a cost-effective strategy for teen sites,” Diamond added. The venture with Hearst falls under the aegis of a new arm of Alloy, started this May, called Alloy Designs, which is designing and hosting Web sites for third parties such as CosmoGirl. Ten Alloy employees were shifted to staff the nascent unit.
Alloy’s deal with CosmoGirl, follows the Cass transaction; a strategic alliance formed with Hachette Filipacchi Magazines’ ellegirl.com in May, and the April purchase of teen-content provider Carnegie Communications. Alloy’s been able to do the deals based on its improving financial results — it notched a quarterly profit of 4 cents a share on a cash basis for the period ended Jan. 31 — and on the $18.2 million it scored in a private placement this June.
Although there are no formal plans for Hearst to publicize its new Internet destination, Wilke noted that CosmoGirl magazine, whose monthly circulation he put at 750,000, now promotes the Web site with roughly two dozen “Go to CosmoGirl.com” messages scattered through each of its issues. “We’re going to ramp that up,” Wilke said.