Those things improve our margins on the unit economics of any transaction. And they also are going to start to improve our marketing allowables, which means that we can go out in our paid marketing and buy more, buy better, because the – we have better matching behind it. The sources of demand beyond paid marketing, is really a combination of direct and SEO, and that’s going to come from improvements in the product experience. We know what drives homeowner satisfaction and homeowner repeat rate. And that’s better matching with service professionals and a better chance of getting a job done well. And so, we are starting to drive those underlying metrics. We shared some of those stats in the letter. And we need that now to show up over time in direct and SEO.
It’s not going to be sort of an automatic, where it just sort of flip on a switch. But it is something that, over time, with a better experience You start to see those users coming in, coming in more often, coming in our free channels and referring their friends and family. That’s what happens with a better product experience. That does take time for people to realize it. And the other thing I’ll say is that is what we saw happen in Europe. Europe has grown 20% the last couple of quarters. Europe is – I don’t know that we’ll hold down to 20% exactly, but double-digit growth is very real at Europe. It has been real for a while. And that’s a product of, I think, a better customer experience. And the other thing, just tactically, is that the comps do get easier starting in Q2.
Brian Fitzgerald: Got it. Thanks Joey. Appreciate it.
Joey Levin: Thanks, Brian.
Christopher Halpin: Drew, next question.
Operator: The next question comes from Jason Helfstein with Oppenheimer. Please go ahead.
Jason Helfstein: Thanks guys. Good morning. Two questions on Dotdash Meredith and then a quick housekeeping question. So what percent of ads, or coverage does D/Cipher cover? And is there still risk that CPMs fall post cookie deprecation? And then how do you think potentially about offsetting that with a higher mix of performance inventory, so D/Cipher? And then how are you thinking about the impact of the Amazon retail media partnership and then thoughts about expanding that to other DSPs, and retail partners in ’24? And then I’ve got a housekeeping question after that?
Joey Levin: Sure. I’ll start. The – a lot of those questions are related. So first, we have D/Cipher in about 30% of our direct ad campaigns since we launched it less than a year ago. And I think that’s like 150 clients. And the folks who are buying it are, as far as we can tell, very happy so far. No sign that people won’t be repeating on that. And then when we’ve done case studies, and we’ve done a couple. One with a large well-known beauty brand, we did a case study with Amazon. And in both cases, we saw a meaningful lift relative to cookie-based targeting. And so, we’re – we have a lot of confidence in D/Cipher’s ability to deliver for our customers. One of the things that will drive that D/Cipher adoption, is plugging into the pipes and the purchase path of DSPs, demand-side platforms.
So that advertisers can access D/Cipher’s targeting easier, or access it in areas where they’re already organizing their money and spending their money. So Amazon is the first example of that, but we hope and expect that there will be many more of beyond that. We’re obviously targeting the biggest ones first. Working with Amazon is happening already. We’re working on something with Google and then we’ll look to really integrate with every ad agency. And this is a thing that’s a win-win. It’s a win for the advertiser on performance. It’s a win for the partner, where their data combined with our data delivers better, more spend. And certainly, it’s a win for us. If we can build into those pipes, which I think is totally doable, then we’ve got big opportunities for growth from here.
Jason Helfstein: And then just the – housekeeping question. The Search and Emerging & Other were both weaker as far as the – I think, the ’24 outlook versus the Street. I guess, with Search, is this the new baseline for Search? Just any color? And then are there any one-time factors you want to call out why Emerging & Other was weaker than the Street as well?
Christopher Halpin: Yes. Thank you, Jason. On Search, the business definitely experienced a tougher market environment at the end of last year. You can see that in it producing $7.5 million of adjusted EBITDA in the fourth quarter. This is – it’s continued in the first quarter of this year, but we believe we’ve reached the baseline where we are, and it should grow from here. That business – has always done a great job of finding new areas in digital advertising to create value and create profit streams. That’s our goal for ’24. But hitting a baseline in profitability recently is what drives the $20 million to $40 million of adjusted EBITDA guidance, and that’s really just a reflection of the softer environment for that business.
