E-commerce as a Revenue Stream
for editorial web sites
Conclusion
What will the future hold?
While e-commerce is a booming business* for non-editorial companies, editorial sites are not generating the same percentages of revenue from e-commerce. Based on the information provided by Forrester, it appears that e-commerce is not vital to the bottom line of editorial sites, as it is not making any money.
For example, Time.com, which made "strenuous efforts for a brief period to leverage its Barnes and Noble partnership," only generated about $8 a month as a share of its book sales, according to Janice Castro, formerly of Time.com. Janet Dobbs of Tribune Interactive said, "Last year, we worked on and launched some e-commerce partnerships, which recently ended. The expense (sales effort, marketing, etc.) outweighed the revenue potential."
If e-commerce were vital to the survival of editorial websites, it would account for more than 15 percent of site revenue. As Dobbs said, sometimes the cost to run e-commerce on the site outweighs the benefits. While the e-commerce revenue stream is not exactly declining in use, it is certainly not on a massive up-swing. It may be safe to say that e-commerce will maintain its low-profile role on editorial sites in the future, and editorial sites will continue to struggle with the integrity issues presented by pairing content and commerce. It is difficult to strike the right balance of editorial integrity while profiting from good placement of commerce within the editorial parts of the site.
*Although, according to PC Data Online, traffic to leading e-commerce sites declined about 4 percent on average in February 2001, following an 18 percent seasonal drop in January. If e-commerce activity is waning in general, what does this say for e-commerce on editorial sites?