KNOT: Scratching my head on this one. Looks great, but coming close to its lows and coverage beginning next week. Has some BIG names affiliated and invested. I know Kim likes it and added recently at $9 3/4. I have initiated a position and will be adding significantly. Here is a couple of interesting articles:
Every year more than 2.4 million couples get married in the United States, generating more than $45 billion in retail sales. According to a recent survey, the average couple spends about $19,000 on a wedding, the company said.
Since the site was launched in July 1997, the Knot (www.theknot.com) has grown into a virtual shopping and planning destination with more than 395,000 couples currently enrolled. The company said 1,000 couples enroll every day.
The Knot also sports a database of about 13,000 local wedding vendors in 52 markets nationwide, as well as a database of more than 15,000 bridal gowns from 140 designers.
It also offers a number of interactive planning tools, including a budget keeper, a wedding checklist and a place where couples can build their own Web site. It also hosts chat discussions and message boards for couples to exchange ideas.
Here is another one:
Grooms and brides-to-be have long been a highly coveted market for advertisers and publishers. And it's no wonder, as the domestic wedding market approaches $45 billion annually, with over 2.4 million U.S. couples getting hitched each year. No other single event in an individual's life is allocated such a large budget as a wedding, with average costs around $20,000. Deep pockets for a once-in-a-lifetime event translates into an advertiser's dream. Before the Internet, the magazine industry reaped most of these benefits, with the top three bridal publications generating nearly $200 million in gross annual revenues for 1998.
As with all things bricks and mortar, enter the Internet. Rather than pay $20 for a year's subscription to Bride's or Modern Bride magazine, Web surfers can now get that information and much, much more for free at a host of online wedding portals. With its expected debut this Thursday, The Knot will be the first in its field to enter into the public spotlight.
Weddings go cyber
For those couples about to tie the knot, the advent of online wedding portals such as The Knot has been a veritable blessing. They provide information above and beyond the scope of traditional bridal magazines that primarily consist of articles and advertisements. Wedding super-sites, on the other hand, offer a wealth of interactive and personalized planning tools to truly make weddings more hassle-free and fun.
At The Knot's Web site, future brides can peruse a database 15,000 bridal gowns, searchable by designer, price, and style. Find one you like, then enter your zip code and find the nearest retailer. Have less than $20,000 to blow? No problem. Try The Knot's interactive budget calculator to help keep expenses below the eye-popping level. A handy online checklist with your personalized wedding date tells you what to do and when to do it. If you're on the go, your checklist can be sent monthly through reminder e-mails.
Mother-in-law driving you crazy? Let off some steam at "The Bitching Post," just one of many of The Knot's message boards where you'll find an audience of others just like you. Want to enlighten your family and friends with your engagement story, or share photographs with faraway relatives? The Knot makes it easy to set up a free Web page for you and your beloved to share details, directions, or photographs.
E-commerce initiative
The Knot launched its gift registry a year ago with the goal of providing the most diverse product selection in the most convenient way. To do this, the company took an Amazon.com (AMZN) approach, going direct-to-manufacturer rather than partnering with a single retailer. Three months ago, The Knot expanded its wedding gift registry with a $15 million investment from home shopping juggernaut QVC, Inc. Through the alliance, The Knot gains access to QVC's diverse manufacturer relationships, as well as its warehousing, fulfillment, and distribution services. This increases The Knot's product selection to over 10,000 unique and diverse items.
But how does all this free content earn The Knot money? Advertising and sponsorship opportunities, of course. For the first six months of this year, revenues totaled $700,000, of which 74% was from sponsorships and advertising. Losses for the same period were $3.5 million. Not bad as far as Internet startups go, but brand recognition is paramount. As The Knot garners more of the wedding audience, more advertising opportunities abound, enhancing the bottom line. The company is already on the right track, growing from 2.5 million page views in December, 1998, to over 15 million in July, 1999.
Big-name backers
Contributing to this explosive growth is the broad exposure The Knot has garnered from its longtime relationship with America Online (AOL), which will have a 10.8% stake following the offering. The Knot was initially launched in 1996 with $700,000 in seed money from AOL. Since then, the partnership has blossomed. In January of this year, AOL opened its Weddings channel at Weddings@aol, available at keyword "weddings," with The Knot its primary wedding content provider. As an anchor tenant through January, 2003, The Knot will continue to have access to AOL's 15 million eyeballs into the foreseeable future.
Another key investor is renowned venture capital fund Hummer Winblad Venture Partners, whose 1998 investment enabled The Knot to launch its gift registry. Additionally, in March of this year, co-founder of the VC fund, Ann Winblad, joined The Knot's board of directors. As a member of the board, she will help advise the company on further expansion opportunities as well as brand development strategies. After the offering is completed, the VC firm's stake in the company will be a cool 25%.
Blazing new trails
To further itself as a one-stop online wedding destination, The Knot has actively pursued acquisitions of complementary e-businesses. In July, 1999, the company acquired Bridalink.com, an online wedding supply store, in order to enhance its e-commerce strategy. At Bridalink, couples can shop online for a wide selection of wedding favors and accessories, from wedding albums to table centerpieces. That same month, the company acquired online travel agency Click Trips. Since 99% of newlyweds go on a honeymoon trip, spending an average of $3,600, having an in-house travel bureau is a great boon to The Knot's e-commerce initiative. Prominently displayed on The Knot's front page is Wedding Photographers Network, an online searchable database of wedding photographers, which the company acquired in August.
Additionally, last July, The Knot entered into a strategic alliance with Wedding Pages (WDIN). Wedding Pages is the number-one publisher of local wedding publications, both online and offline, matching over four million couples with local wedding professionals. By partnering with them, The Knot becomes the only wedding portal to have a walking sales force in 52 cities, reinforcing its position as the most comprehensive wedding site on the Internet.
Redesigned to match The Knot's own Web site, Wedding Pages has become a seamlessly integrated extension of The Knot. While the partnership hasn't seemed to help Wedding Pages' share price, which has yet to break the $2 mark, the alliance is key for The Knot to further distance itself from its competitors. |
