Tumblr has been generating a lot of buzz this week following Yahoo’s one billion dollar acquisition. We all wish David Karp, Tumblr’s 26 year old founder and CEO, success as he embarks on this new adventure and we thought we’d take this opportunity to use SimilarWeb and take a look under the hood to understand paying 10 figures for it was a wise move from Yahoo.
Traffic is Key
Over 1.1% of the internet’s users have visited tumblr at least once in the last month, spend over 11 minutes per session and have close to 8 page views. All these numbers are very impressive but how does it measure up to some of the other blogging platforms?
But Engagement is King:
Tumblr is undoubtedly the first of its class when it comes to website engagement in the blogging stratosphere but how does it compare to the web’s best time wasters?
If Tumblr is tempted to decline Yahoo’s offer and go down the IPO route, they need to double page views and time on site if they’re trying to beat Facebook’s $100 billion IPO.
First we’ll take Manhattan, Then we’ll take Berlin
Marrisa Meyers has been at Yahoo’s helm for close to a year and during that time has mostly focused on US based M&As however has made an exception with of Summly and an offer for Dailymotion. Acquiring Tumblr enables Yahoo to get two birds with one stone- a large international user base from an US based company.
Take a look at Tumblr’s breakdown of traffic by country:
Search isn’t just about Words
Search used to be really simple when Yahoo ruled the market, so simple in fact that back in the day Yahoo told you what you had to bid in order to be #1 in paid search. Along came Google and ruined everything by introducing Universal search such as videos, maps and images into the search results. Over 25% of Tumblr’s search traffic (5% of it’s overall traffic) comes from image results.
At the end of the day, Tumblr’s price tag is about how valuable the traffic on the site is and how much advertisers are willing to pay for it. Over 22% of Tumblr’s outgoing traffic goes to the internet’s biggest time burners; Facebook & Youtube. Both sites have done fairly well in monetizing traffic and one can only assume that Tumblr’s traffic is up to par with theirs.
Below chart of Tumblr’s Top 20 outgoing links:
Is Tumblr a Youtube or a Myspace?
According to the Talmud prophecy was given to fools so I prefer not to guess whether Tumblr will become Yahoo’s future cash cow or white elephant. That said, Tumblr’s traffic numbers are top of its class and if Yahoo are looking to massively increase their global content then $1 Billion seems like a very reasonable price.