“That’s a very old media way of thinking about things,” said Ben Lerer, 29, co-founder and chief executive of Thrillist. “This is not a digital magazine that sells some stuff. This is the beginning of what a new media company looks like.”
Many Web publishers sell things, like restaurant meals and spa services on the Sugar blogs, which are aimed at young women; designer clothes on DailyCandy, a local e-mail newsletter for women; and books on Salon. But the trend of mixing commerce and content is not limited to online publications or to those that write about soft news.
This month, companies including The New York Times and Meredith Corporation, publisher of Ladies’ Home Journal, announced that they would team up with an e-commerce company, Group Commerce, to sell daily deals. The Times will introduce e-mail discounts for restaurants, events and travel from advertisers, and Meredith will sell deals to subscribers, like children’s products to readers of Parents magazine.
Debates about the divide between commerce and content on the Internet have been going on since the mid-1990s, said Steve Outing, director of the Digital Media Test Kitchen at the University of Colorado at Boulder School of Journalism. But now “the lines are just definitely a lot more blurred,” he said. “Depending on the site, a lot of the time you can’t necessarily tell the difference” between ads and editorial, including on Thrillist, he said.
Mr. Lerer said the sales and editorial teams operate independently, so a restaurant could never buy good coverage, for instance. Jason Ross, founder of JackThreads, Thrillist’s private sale site selling men’s streetwear, said the company achieves the distinction of being separate from editorial by using the label “brother company.” “It’s not like Thrillist is shoving it down readers’ throats,” he said. “Their editorial voice is their credibility, so hurting that in any way would be pretty harmful.”
Mr. Lerer’s bet that commerce, not just advertising, is the key to making online media profitable reaches beyond Thrillist. He has also invested in Group Commerce through Lerer Ventures, which he runs with his father, Kenneth Lerer, a co-founder of The Huffington Post.
Media companies have long worried that if they sell things other than their content, reporters writing about those products or services would be inclined to give them favorable coverage, or that readers would doubt their independence.
But some traditional publishers say readers are now more sophisticated, compiling personal newsfeeds and relying on Facebook and Twitter friends to serve as their editors. Meanwhile, e-commerce sites like Gilt and Groupon are becoming more like magazines, hiring writers and publishing editorial content.
Print publishers tend to treat commerce like any advertisement, keeping the two separate. “My team and the editorial team work very closely to make sure this is offered in a very appropriate way, that lines are drawn clearly,” said Liz Schimel, executive vice president of the Meredith National Media Group. Editors will not endorse offers, for instance.
The lines are blurrier at Thrillist, which Mr. Lerer started with Adam Rich in 2005 when they were living in New York after graduating from college. Sitting on Mr. Lerer’s West Village rooftop one day, they discussed how useless the available city guides were because they were written for both young men and their grandmothers, Mr. Lerer said.
He pitched the idea for an online guide for young men to Robert Pittman, a family friend who founded MTV and had invested in DailyCandy, and he invested about $1 million.
Thrillist quickly adopted a distinct voice — one that would never be mistaken as being written for the men’s grandmothers.
The reviews, which are usually a couple paragraphs long and always positive, are peppered with double-entendres and adjectives like “insane,” “sick” and “gut-busting.” A bar, Thrillist says, has “additional seating in the form of three church pews — persuading a girl to sit with you is only a matter of invoking a Holy Boast.” (Thrillist has had a female writer, but she left the company.)
Thrillist’s attracts a particular type of young, urban male reader, and offers that same audience to retailers. Recently, shoppers on the site were offered a half-off deal on “a strip and a strip” — a dance at the strip club Scores and a steak at its in-house restaurant. Just before Valentine’s Day, they paid $25 for $50 worth of lingerie, bourbon and a viewing of women modeling the undergarments at a store called Journelle.
These deals would never appear on Groupon, the largest of the daily deal sites, because its audience is so broad. But Thrillist sold thousands.
The company has well-known advertisers like American Express and Target and is profitable as an ad business — a benefit from being an e-mail newsletter, Mr. Pittman said.
“You’ve got to be really, really good for the consumer to let you come into their e-mail box,” he said. “Once you do that, advertisers will pay a premium.”
But now the e-commerce business is fueling Thrillist’s growth. Mr. Lerer said Thrillist was on track to bring in at least $40 million in revenue this year, half of it from JackThreads, while the ad business was about $10 million last year.
Thrillist bought JackThreads, which is based in Columbus, Ohio, in May for an undisclosed sum, and started its daily deal site, Rewards, in December in New York. The company plans to expand daily deals to San Francisco and other cities this year.
“We had an audience who trusted us and lots of evidence people did what we suggested,” Mr. Lerer said. “Why are we sending all the value to the people we write about editorially? Why can’t we capture some of that value ourselves?”