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Future Looks Bright for Web Sites Targeted at Women

 


by Hal Plotkin
Silicon Valley Correspondent

Despite the recent dot-com gloom, the future looks rosy for Web sites targeted at women. According to a recent study by Nielsen Media Research and CommerceNet, the number of female consumers online jumped more than 80 percent last year. There are now more than 22 million women online in the United States, according to Forrester Research.

“It’s the fastest-growing group on the Internet,” says Jordan Rohan, an Internet analyst at Wit Capital, based in New York. “I’m very optimistic about Web sites aimed at women.”

Despite this optimism, fears about the prospects for women-oriented Web sites after news surfaced last week that San Mateo, Calif.-based Women.com had delayed its IPO.

There was, however, one problem with those reports. “They weren’t true,” says Becca Perata-Rosati, a spokesperson for Women.com. News of Women.com’s IPO “postponement” was reported by the Associated Press and The IPO Monitor, among others.

“We haven’t even formally scheduled our IPO yet,” says Perata-Rosati. “We’re still talking with investors, things are going well, and we are proceeding according to our plan,” she says.

In addition to Women.com, there are a growing number of other sites scrambling to attract female eyeballs on the Web.

Leaders in that group include iVillage.com {IVIL} and Oxygen.com. In addition, Time Warner has announced plans to launch a new online site and TV channel, called the Women’s Network, sometime early next year.

“This is going to be a very competitive market,” says Lauren Cooks Levitan, a principal at BancBoston Robertson Stephens, based in San Francisco. “But women currently represent the majority of retail sales, and that will eventually be the same online.”

Earlier this week, iVillage, based in New York, reported a 2Q loss of $17.1 million, or 72 cents a share, compared with a loss of $11.8 million, or $1.85 cents a share, in the year-earlier quarter.


IVIL stock price chart since its IPO in March

Looking forward, though, iVillage says revenue from the fourth quarter and 2000 could be 20 percent higher than analysts’ expectations, according to industry reports.

iVillage expects its membership ranks will swell to 3.7 million by the end of the year, compared with 2.1 million members at the end of June.

The company had $6 million in advertising revenue during the most recent quarter, almost three times the proceeds it derived from advertising during the same period last year. iVillage’s e-commerce revenue also grew quickly, up from $520,000 during the second quarter last year to $2.1 million for the same period this year.

“The [women-oriented] Web sites that are most broadly targeted have advantages over more narrowly-targeted Web sites,” such as sites aimed at travel, health, or general purpose retail, Rohan says.

Company Snapshots (1998)

Figures on a Pro Forma Basis

Women.com 

Networks Inc.

iVillage Inc.
Revenue $11.7 mln $15.0 mln
Income (Loss) ($49.6 mln) ($43.7 mln)
EPS ($1.71) ($2.59)
Shares Outstanding 29.3 mln 16.9 mln
No. of Employees (as of Aug. 10, 1999) 250 291

Others are also eyeing this potentially lucrative market.

New York-based Oxygen Media, owner of the Oxygen.com Web site, is ramping up to launch its TV channel aimed at women early next year. The company was founded in 1998 by Geraldine Laybourne, the former president of Disney-ABC Cable Networks. Investors include Oprah Winfrey’s Harpo Entertainment Group, in addition to TV producers Marcy Carsey, Tom Werner and Caryn Mandabach.

By 2000, women are expected to account for 47 percent of online sales, according to Jupiter Communications. Women influence 80 percent of new car purchases and 53 percent of all investment decisions, according to Wit Capital’s Jordan Rohan. He adds, “you’re really talking about the heart and core of the American economy. As more women come online, they are going to turn to the Web sites that have the most comprehensive collection,” of online resources.

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