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Site Marries Advertisers and List Owners

E-mail newsletter and discussion list company Topica Inc. Monday began centrally serving ads to its 75,000 e-mail discussion and newsletter lists. The new service, the Advertising and List Promotion Network, will enable advertisers to marry information with the appropriate small to medium-size list.

“Up until now, the owners of the larger newsletters had been able to manually insert some ads themselves. The smaller ones [found] it just wasn’t worth their while to manually do all of that,” said Ariel Poler, CEO of Topica, San Francisco.

The network will allow advertisers to reach e-mail audiences in Topica’s lists. The online list host manages lists across 5,000 categories, including investing, cycling, books and music, one-third of which are hosted on www.topica.com. Topica oversees 4 million e-mail subscriptions and sends 100 million e-mails per month.

The majority of Topica’s list owners are individuals, but the site also manages discussion lists for companies. For example, Topica hosts a discussion list for the readers of Business 2.0’s Iconocast e-mail newsletter. “We do that in a partnership with Iconocast,” said Poler. “The actual Iconocast newsletter, they host themselves, and we have it in our directory.”

Ads will appear at the bottom of the e-mails on high-traffic discussion lists and will likely appear at the top for newsletters.

The e-mail host will screen the ads to create a win-win situation for advertisers and list owners, according to Poler. “We will not accept ads that we believe would not be of interest to our audience or that we believe would be offensive to our audience,” he said.

Topica does not have a specific advertising pricing model in place for the ads that it will serve. “CPM is indeed the most common way of charging for advertisements; however, we also do deals based on clicks, conversions, sales and unique users,” Poler said.

The network is the 2-year-old company’s third revenue stream. Topica also is building an opt-in e-mail database of subscribers who have expressed an interest in receiving promotions and offers from online merchants and renting that list to merchants to send a one-time e-mail promotion.

Newsletter publishers that work with Topica also pay the company a bounty fee for every subscriber that Topica sends to them. “So as the traffic to our site grows, and it becomes better established as the place you can go find the right newsletter, we’re also going to have a growing referral type of revenue stream,” added Poler.

Topica is privately held and venture-backed by August Capital, Highland Capital Partners, Moore Capital Management and Stanford University. n

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