Traffic is Magical

In November I wrote a piece titled Traffic is a Metric, Nothing More, which explored the different ways people view traffic and how other metrics easily trump the traffic one. However, in this fast-paced VC type of world traffic is really the only measurement investors have to go by and so obviously that is the one they are going to use. Advertisers use traffic as a metric because they want to know how many people are going to see their ads, but why do VCs find the metric to be so special? I think it is because it is magical.

Yes, I said I think traffic is magical.

What made me think of this was the news that Glam Media had raised an astonishing $18.5 million in Series C funding (that means it’s their third round of funding, which that fact alone amazes me). If you don’t know much about Glam Media go have a look at the site and let me know what you think. In a sense, they are very similar to 9rules and Federated Media in that they have content sites in their Network that they don’t own (9rules) and sell adspace for those sites (Federated Media).

Now from experience I can tell you that it doesn’t require that much money to run an operation like this and after going through the Glam site, which isn’t that badly designed, you have to hope that they have some television channel in the works along with opening up a couple of stores across the country to spend all of this money. In any case, the basis behind the investment seems to be the traffic numbers that they throw around.

Glam Media reaches over 7 million global unique visitors per month and is a top 10 women’s property, according to comScore Media Metrix October 2006 reports.

If you read the comments and do some investigating of your own you will find that the number of 7 million is derived from the traffic across the whole network which consists of over 200 sites. On their site though you get the idea that all the visitors are hitting their site and now the logo claims 8 million visitors. Whether the investors know these things is unknown, but what person wouldn’t light up if you told them you ran a site that reached over 8 million people a month?

The problem with traffic being the sole metric is that it doesn’t tell us much of what the world really thinks. I know the mindshare of 9rules is much larger than the actual traffic, but to an investor the latter is more important, but to us and our future the former is what we have always strived for with the feeling that traffic will follow. In the comments there are some fashion bloggers discussing how they have never even heard of Glam before and I find it interesting because they say they are pretty well-known themselves in the industry. If the people in the industry don’t know about you can you expect regular people to have any awareness that your site even exists?

I think it is cool that Glam got so much money and hope that they put it to good use, but the mind of the investor will always leave me confused. That is the reason I think traffic is magical, because you can make up any number you want and magically money appears. When people ask where you got those numbers from be honest and tell them: from your top hat.

For more information on the Glam investment checkout Venture Beat which reports that in total they have received over $30 million in investments. Stunning.

Disclaimer: There seems to be a trend with people adding disclaimers when they talk about competition and I guess you can say Glam is competition to 9rules (we all need it right?), but I wanted to inform everyone that I am writing about Glam not because I am interested in woman’s fashion, but because my nickname in elementary school was “Glam”. They had a whole song for me and everything. The Glam Man!

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Published by Scrivs on December 15, 2006 in Web++ • Did you like it? Subscribe! Or Submit it to Blogosphere News!