Direct Navigation Economics Part II
Marchex posted some quite admirable fourth call earnings last week, driven by a surprising upside in its direct navigation business.
I did a few quick sums and thought I would jot them down here.
Traffic to direct navigation domains increased from 24m uniques in September to 27m uniques in December. Let’s assume that there was an average of 25m/mo and that each visitor only visited one domain (conservative) and one page (since each domain essentially only has one page of content - the list of ad links. Again to be conservative, as they are starting to experiment with richer sites.)
That would equal 75m page views, or 75,000 lots of 1,000 page views.
Revenue from Direct Navigation was $10.3m for the quarter.
That gives a monetization rate of $137 per thousand page views or $137 eCPM.
Of course, the real figure is likely lower as the average number of sites is greater than one and the average number of page views is similarly greater than one. However, with those sorts of economics its no wonder that management on the call said that they are beginning to pay for traffic from search and generating a positive return on the advertising.
Also, congratulations to Kirby Winfield, who was previously VP of Marketing for the whole of Marchex and who is now heading up the Direct Navigation business as General Manager. Kirby is one of the smartest operators out there in the search business and I am sure the business will continue to enjoy the stellar trajectory it is now on.
[…] Openlist was co-founded by Matthew Berk, a good friend and former Jup colleague, in 2003. In the nearly three years (it’s hard to believe that it has been that long) since founding it, Matthew and his partner Bejul, have endured a roller coaster ride through a CEO that came on and didn’t work out, a round of venture financing from a top tier VC that they ended up declining and finally the sale to Marchex (who regular readers will know I am also a fan of). The transaction is a fantastic outcome for Matthew and a fantastic outcome for Marchex, which is leading the direct navigation industry. […]