Exclusive: Dotdash launches its first online store
Dotdash, the digital media company owned by IAC, is launching its first-ever standalone store pegged to its site Liquor.com, which it acquired in 2019.
Why it matters: Dotdash now makes roughly one-third of its annual revenue from commerce. It's hoping standalone e-commerce stores like The Liquor.com Store will accelerate that effort.
Details: The new online store will sell a handful of items, curated by Liquor.com's editorial team, including cocktail kits, wine glasses, tumblers, decanters and jiggers — almost all items for under $100.
- Dotdash will control the entire experience, curating the products, as well as managing the boxing and wrapping, customer service and shipping.
Be smart: For now, the effort is experimental, but Dotdash CEO Neil Vogel says "when we get this right, the expectation is that you're going to see a bunch of these at our key brands. ... If we can make it work, it's a really interesting potential business for us."
- Editors will curate goods created by third parties. "At some point, they [the online stores] might be populated by our own products," Vogel notes.
- Dotdash owns and operates 14 different websites, spanning categories like health, home, food, style and finance. Some of its more popular sites include Simply Recipes, The Spruce, Investopedia and Verywell.
- Kit Codik, the founder of Liquor.com, is leading Dotdash's efforts to expand its commerce business across verticals.
By the numbers: Dotdash has compounded revenue at 33% annually over the last three years, per earnings reports. Last year, it had over 30% adjusted profit margins.
- This year, Dotdash is on track to bring in well over $250 million in revenue, and it will likely increase profit margins, making it one of the fastest-growing and most profitable digital media holding companies in the country.
- Analysts estimate Dotdash is worth roughly $2 billion, which makes its valuation higher than that of BuzzFeed or BDG Media. Commerce is an increasingly large part of its growth.
- "Between 35-40% of our business is helping people buy stuff," says Vogel. "The whole thing will be well above $100 million revenue this year."
Catch up quick: Dotdash started its commerce business a few years ago with affiliate commerce, a practice in which publishers link to retailers when they mention products.
- Today, the company's "performance marketing" revenue includes affiliate commerce, as well as revenue from commerce partnerships with bigger retailers.
- The company currently sells its own paint and pet care products via online vendors like Amazon. It launched a home organization line with Lowe's last year. It plans to launch bedding, sheets and kitchenware products next year.
- The company has a 9,100-square-foot product testing lab in Brooklyn, where its editorial teams test thousands of products every year to make affiliation recommendations. Not all its verticals recommend physical products. Some recommend services, including credit cards and therapists.
- Vogel says that for now, the company has no plans to launch its own physical retail store.
The bottom line: "You can see how it's all coming together," Vogel says. "If people want to buy things or need help making purchasing decisions we want to help them do it."
Go deeper: Dotdash is IAC's fastest-growing business