媒体集团 People Inc. 搜索流量两年降 70%，押注页面访问之外的收入

People Inc. isn’t mincing words about the current state of digital publishing: It’s bad.

The company has seen a “critical loss of sessions,” Barry Diller, People Inc.’s chairman and senior executive, told investors during the company’s Q3 earnings call Tuesday morning.

People Inc.’s referral traffic from Google search is down 70% over the past two years, dropping 26% in Q3 alone, the steepest single-quarter decline yet, after a 22% drop in Q2.

AI Overview summaries now appear at the top of 90% of Google searches associated with People Inc.’s content, said CEO Neil Vogel.

That traffic is gone, and it isn’t coming back, Vogel conceded to investors. The loss contributed to People Inc. laying off 195 employees, about 6% of its staff, last week.

However, People Inc. believes that it has weathered the worst of Google’s AI search overhaul and that the biggest referral traffic drops are behind it.

Vogel emphasized that, despite its traffic challenges, People Inc.’s digital revenue is still growing, albeit slowly.

Digital revenue rose 2% year over year in Q3, to $289 million, marking People Inc.’s twelfth consecutive quarter of digital growth, even as total Q3 revenue was down 4% to $431 million.

The bill comes due

Despite revenue declines, Vogel credits People Inc.’s ongoing digital growth to the fact it was able to predict changes to the digital publishing model.

People Inc. coined the term “Google Zero” after all, he noted. Anticipating that most search traffic will disappear, People Inc. has spent the past three years transforming its business to focus more on non-session revenue and advertising products like its D/Cipher contextual targeting tech, he said.

The time is now right for these investments to start paying off, and the company should see the first major returns in 2027, according to CFO Tim Quinn.

That better be the case. Diller said he would be “very disappointed” if People Inc. didn’t return to double-digit growth next year.

Non-session growth

Looking ahead, People Inc. plans to focus on growing non-session revenue, meaning everything that isn’t tied to website visits. Non-session revenue already accounts for 43% of its digital revenue and grew 15% YOY in Q3.

By comparison, session-based revenue – which accounts for the remaining 57% – was down 6% last quarter.

People Inc.’s non-session growth priorities include live events and activations and content licensing deals with news aggregators, including Apple News and Yahoo, and AI companies, such as OpenAI, Meta and Microsoft.

Licensing revenue grew 49% in Q3, led by content deals with aggregator platforms and AI vendors. But this growth will slow a bit in Q4 as People Inc. laps the licensing deal it announced with Meta last year, Quinn said. That deal boosted last year’s Q4 numbers, which makes for a tougher comparison.

People Inc. has been exploring licensing its publishing brands for product and retail opportunities, but there’s been little sign of a return so far. For example, it’s been talking about releasing a Southern Living-branded sweet tea line for the better part of a year, but the product has yet to launch.

Also in the non-session revenue mix is D/Cipher, which People Inc. extended last year to include contextual targeting on third-party sites in addition to its own properties. D/Cipher’s targeting capabilities extend to CTV, which People Inc. sees as an untapped growth opportunity, Vogel said.

People Inc. is also expanding its non-session footprint on the digital media side, chiefly by launching more video series on social platforms.

One example is “The Intern,” a short-form video series featuring the InStyle editorial staff, which People Inc. is monetizing by allowing brands to sponsor a full season, which comprises seven three-minute episodes. “We weave that sponsor into the plot line in a wink, wink way that users enjoy,” Vogel said. “They then have the opportunity to layer on events at InStyle, events at People, media across YouTube and Instagram and across all these other places.”

While a show like “The Intern” is “very lucrative and very high margin” on its own, Vogel added, the opportunity to package other digital inventory and live activations into the sponsorship feels “very modern and very exciting for advertisers.”

People Inc. is also packaging more marketing opportunities across its highest-profile brands.

For example, Vogel pointed to People’s revamped “Sexiest Man Alive” offering, which this year features Noah Wyle, star of “The Pitt.”

“What started as a magazine cover, then a web feature, has become a robust franchise that lives across Instagram, TikTok, YouTube, Apple News, our People app and VIP subscription, podcasts and our distribution partners,” Vogel said. “We grew revenue associated with SMA this year 50%.”

Session-based ad revenue

The picture is less rosy elsewhere, though. Vogel did what he could to sugarcoat the 6% Q3 decline in session-based revenue by noting it could have been worse. After all, web sessions were down 26%.

But People Inc. offset the traffic decline with higher premium ad rates for both programmatic and direct-sold inventory, Quinn said.

Still, People Inc.’s advertising revenue was down 8% YOY in Q3. Its plan to get back to growth is to keep demonstrating strong performance for advertisers to compensate for traffic declines, Quinn said.

That being said, People Inc.’s performance marketing revenue growth slowed from 13% in Q2 to 2% in Q3. This slowdown was largely due to Amazon Prime Day falling in Q2, which shifted roughly 4% of growth to the earlier quarter, Quinn said.

Future plans

But People Inc. remains bullish on the opportunity to reach readers directly through its owned-and-operated apps, including MyRecipes and the People VIP paid subscription tier. It’s exploring ways to monetize these apps further, Vogel said.

However, People Inc. has abandoned its plans to parlay its stake in MGM Resorts into a bid to take the company private, Diller said, though it still owns 26% of MGM’s stock and expects to buy more.

Diller also rejected a proposal by MGM to acquire People Inc., he said, adding that he doesn’t see any other proposals meeting his expectations for a sale. Meanwhile, pulling back from the MGM deal should free up some capital for People Inc. to reinvest in the company and buy back its own stock.

People Inc. is open to making its own acquisitions and plans to aggressively pursue M&A opportunities, Diller said, though he noted that any acquisitions would likely be small and “bolt-ons to the publishing business.”

In other news, Quinn said, that People Inc. is still holding out hope for a nine-figure damages payout in its ad tech antitrust lawsuit against Google. He noted that USA Today’s Google lawsuit is moving forward and that People Inc.’s is next in line.

If it comes, a court-mandated payout may just be the last big check People Inc. gets from Google for the foreseeable future.