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How Sweet Is It?

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And that is basically it; DailyCandy has stoically declined any invitation to branch out. The inevitable book, just out from Hyperion, gets a smiling dismissal from Levy as a “fun way for the editors to cut loose and write something more literary.” Where a lesser entrepreneur would have long ago cashed in with DailyCandy bath gel, a DailyCandy yoga mat—hell, DailyCandy candy—Levy has stayed almost fanatically true to That Thing She Does.

So surgically calibrated is the company mission that it resists even the most obvious spinoff idea: a newsletter for men. Two laddish copycats—Thrillist and the suspiciously assonant UrbanDaddy—are duking it out for a piece of the underserved demographic. “The concept of ‘DailyCandy for men’ unfairly implies that men don’t read us, which they do,” deadpans Levy.

DailyCandy makes its money on ads in two ways: discreet sidebars on the site or in the e-mails themselves and separate, paid-for mail-outs, each honestly tagged “A DailyCandy Dedicated E-mail.” The company’s unique business model forces it to walk a microscopically thin line. On one hand, it prides itself on its unsullied integrity. On the other, its editorial content is practically indistinguishable from advertising—completely indistinguishable as far as the average reader is concerned. The paid-for e-mails are mildly curated (“We work with the advertiser to find an angle that will make their product more attractive to our reader,” says Levy) and written in the same breezy style as the unpaid ones. Often, admits Romano, these “advertorials” are written by the advertiser, faithfully copying the Candace Bushnell cadences of the house style. Clicking on a “dedicated” e-mail can induce a Twilight Zone moment as your trendy friend’s standards mysteriously drop: “When it comes to bath and body products, you really like to play the field. But . . . nothing compares to your first love, Neutrogena.”

On a given day, your in-box may steer you toward a tote made of discarded sails, coo over a spa, or gush about a hotel in Udaipur—but the story is always you.

Needless to say, paranoia creeps in. With the Internet a perfect playground for stealth marketing and beverage-company street teamers trolling Web boards to casually big-up Coca-Cola Blak, everyone is a suspect. It’s one thing to take shopping cues from a pal; it’s quite another when she’s just joined Amway.

The company knows this, and fiercely combats any perception of impropriety. “DailyCandy is strictly editorial. There is no pay for play,” reads the bottom of every message (except the dedicated ones, naturally). “You cannot pay to be in DailyCandy,” says Levy with added steely staccato. She peppers her side of our phone conversation with the word integrity. Integrity of the product, integrity of the site, editorial integrity. The site’s FAQ cuts to the chase: “No, we would never sell our subscriber list to anyone. Not for any amount of money.”

But there is, of course, one way to buy DailyCandy’s subscriber list. That way is to buy DailyCandy. And this brings us to the February announcement heard round the world—or at least from Wall Street to the upper reaches of Madison Avenue.

Bob Pittman is no stranger to the steep appreciation of hard-to-define businesses. As Steve Case’s associate, he oversaw AOL’s monstrous growth in the nineties. He also quickly became the chief scapegoat when AOL’s acquisition of Time Warner went awry in its myriad predictable ways.

New York’s longtime readers may remember Pittman, an energetic Peter Gallagher look-alike, as a bona fide celebrity and Manhattan social-scene staple in the late eighties, after he shepherded the nascent MTV into its present shape for Time Warner. Pittman’s first public act after the AOL debacle was buying DailyCandy through his Pilot Group. Back then, the deal seemed a tad batty, the kind of purchase people would have expected his Everest-climbing socialite ex-spouse—Sandy Hill Pittman—to make. It may soon begin to look like the prescient orchestration of a comeback.

Perhaps tellingly, Pittman’s reasoning for the purchase harks back not to the AOL years but to his old-media background: “Bob and I had seen something similar in TV,” says Pittman’s partner Mayo Stuntz, the Pilot Group’s co-founder, “back when we were at MTV Networks.” After cable claimed a large enough portion of the TV market, the next logical step was the introduction of targeted networks. Likewise, with the world more or less used to the Web, Pittman envisioned the Internet dividing into “channels” along established loyalty lines. DailyCandy seemed a perfect, compact case study. The man who said, back in 1997, “I never want to build another brand as long as I live,” found a naturally self-perpetuating one. “Readers tell others about DailyCandy,” says Stuntz. And the company “proved it could replicate their product in market after market.”

But how much is DailyCandy really worth? If yes, then what about it commands the price? The past year has been good to the Web, with offline behemoths moving in on the better-tested online properties. Rupert Murdoch’s News Corp., in its virgin Internet purchase, picked up MySpace—a social-networking tool that doubles as a launching pad for bands—for $580 million. “Thanks for the add,” indeed. NBC shelled out $600 million for iVillage, a female-oriented Web community, with an eye toward integrating it into its existing assets like MSNBC.com. The New York Times Company bought About.com for $410 million.


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