Mediabistro Survives Declining Classifieds

By: Gary M. Stern When Laurel Touby, a former Business Week and Glamour writer/editor, launched the online site mediabistro as an avocation in 1997, she never dreamed that it could turn into a business. Touby envisioned herself as a cyber Dorothy Parker, arranging cocktail parties for media folks who browsed the site's free classified ads. But mediabistro.com has morphed into a growing online site, specializing in job listings for editors, writers, TV producers, graphic designers, advertising, and public relations specialists.

At first the 60 to 70 media businesses seeking employees through mediabistro could place their ads for free. When Touby realized that mediabistro could turn into a livelihood, she asked employers to pay $100 per listing. Sixteen agreed, and her business was launched. Seeing the profit potential, Marty Peretz, the New Republic owner, invested $250,000, and Gotham Partners, a venture capitalist firm, added $750,000, completing the site's $1 million financing in 2000.

New York-based Mediabistro has five distinct revenue streams: classified ads, recruiting, banner ads, membership, and events, but Touby acknowledges that 80% to 90% of its revenue stems from classified ads -- which have declined along with the economy.

Where mediabistro.com once posted 300 listings at its zenith and averaged 200 ads per day, it's now down to about 160 ads on any given day. Seeing classifieds decline, Touby raised the price of her 30-day classifieds to $199.

Touby said she hasn't yet needed to raise additional funding because last year's investments should sustain the site for some time. The site also increased the number of events for media professionals including dinner parties at $40 a head, which attract on average 40 to 50 people, and panel discussions on business media, sports media, and other topics that average 75 to 100 attendees, each of whom pays about $30 to attend.

Sponsorship from iXL, a Web consulting firm and Price Waterhousecooopers also generates income. Mediabistro's business plan states that revenue from sources outside of classified ads will reach 50% by 2003 but that may be difficult to achieve.

Intent on keeping its costs down, mediabistro employs six full-time staff and has a "zero" marketing budget, Touby said.

Though users log on to mediabistro for free, members in New York, Washington, San Francisco, Los Angeles, Boston, and London can opt to pay $49 annual dues for access to the cocktail parties and "dinner and discourse" evenings. Because of these get-togethers, Touby describes mediabistro as a "community with jobs on it. We're more about bringing people together, not just getting people jobs," she said.

In the media jobs classifieds field, mediabistro's competitors include Editor & Publisher's online classifieds; JournalismJobs.com, which is associated with Columbia University; and Monster.com.