Still our interaction between homeowners and pros relies heavily on the telephone. That’s good. That’s helpful. Pros like to receive phone calls, but homeowners are less eager to receive phone calls than they have been historically. And so getting people to message and getting that back and forth started on our platform, I think, is an area where we still have room to improve. Also, we’re looking at acquisition economics and making sure that we’re acquiring both homeowners and pros that are more likely to match on our platform. And so we’re taking a look at all of our marketing channels, which we’ve been doing for a while. Some stuff that was unprofitable was easy to cut, and we’ve talked a lot about that. But we’re now looking at channels and saying, how can we demand more out of our existing channels?
Not just demand more profit out of our existing channels, but demand better customer experience out of our existing channels. And we think we still have work to do there, and we think that will lead to, again, both more profitability and better interactions, better experiences between homeowners and service professionals. And I’ll just add one more thing on that, which is people have asked me the question, well, are you cutting marketing here in ways that’s kind of overstating the profit or where you’re borrowing from the future to cut marketing? The areas where we’re generally cutting marketing are performance channels. And so performance channels are near-term performance channels. And brand spend is actually up year-over-year, and it’ll be up again year-over-year in Q4.
So that part of the business is healthy, but we’re looking at all the channels and deciding what we want to do and demanding more, again, and customer experience out of each of them so that when we bring a homeowner to our platform and when we bring a pro to our platform, the interactions between those two are much more valuable for each other and for our platform.
Justin Patterson: Thank you.
Joey Levin: Thank you, Justin. Operator, next question?
Operator: Our next question will come from Ross Sandler with Barclays. Please go ahead.
Ross Sandler: Hey, guys. Going back to Dotdash Meredith, so you talked about the strength and performance, but the premium side of the business down 12, I think, was a tad worse than the industry, although improving. So how do you feel about that? And then looking forward, how do we think about the cadence of digital ad growth at DDM in the context of the new session growth rates? Are we likely to see revenue run ahead or behind session growth in 2024, and is that like a function of ad load or improving EPM or some combo of those? How do we think about that? Thanks a lot.
Joey Levin: Okay. Thanks, Ross. You know, for when you compare to the market and think about overall digital advertising growth at Dotdash, I would blend the advertising and performance marketing lines. The third leg of Digital is licensing, which is a little bit of a different beast. But we think of those on a blended basis when looking at comparables. That was down about 3.5% in the third quarter, which when we look at publishing peers, we actually felt like we were holding serve versus what we saw there. We’d like it to be better. We’ve got a little bit of demonetization going on versus third quarter of 2022, when we still had probably over ad load in some of the Meredith properties and some suboptimal traffic. So a little bit is a comp issue, but overall, we view it as down 3.5%, and we expect those numbers to be improved in Q4, even with a soft ad market in October.
So, you know, in our mind, we feel good about the progress we’re making. There are small things that were headwinds, like, you know, the impact of the labor strike from Hollywood and in our entertainment categories. But we’re head down and looking to get those ad numbers to flat and to growth. That talks to, you know, 2024. We’re not providing guidance yet, but when you look at the sessions, which you highlight, core should continue to grow even better. The actor strike got behind us, and there was more entertainment content to talk about. But core is going to be, you know, total and core will be second derivative positive in Q4. Core should grow solidly, and we expect that to continue into next year. So traffic will be a tailwind. A monetization, you know, premium sales are soft right now.
The programmatic CPMs, even in this Q4, should be up the over year, and we think we’re outperforming the market on open market CPMs. So hopefully, you know, advertising revenue, digital advertising revenue is flattish, and then performance marketing is a source of strong growth in Q4 and continuing into next year. So we are optimistic on 2024 to drive Digital – overall, Digital revenue growth, and then given what we’ve said about incremental margins, that should drive continued improvement in profitability. Okay, thanks, Ross. Operator, next question.
Operator: Our next question will come from Brian Fitzgerald with Wells Fargo. Please go ahead.
Brian Fitzgerald: Thanks. A couple follow-ups on DDM, on Decipher. It sounds like there’s been an encouraging response as cookie deprecation kicks off in ’24. Where do you think penetration of that product could go for your general interest sites, and how are you thinking about potential revenue uplift there for both general interest and total DDM digital? And then, Joe, any further thoughts on AI and defending copyrighted evergreen content from DDM? Thanks.
