Everyday a Revolution Health or How 1+1=1.5

The Washington Post had a brief article yesterday of a rumor that local Health 2.0 darling, Revolution Health is in merger talks with Everyday Health.

Based upon my cursory review of Everyday Health and knowledge of Revolution Health, these two look like a carbon copy of one another – lots of female targeted ads, simple content on dieting, some social networking/community capabilities and even simpler tools for health management. Thus, such a merger will unlikely result in a 1+1=3 scenario where each brings something unique to the other, but more of a 1+1=1.5, were the value is in the small uptick in number of users/impressions that can then be sold/marketed to advertisers. But even here I see very little value in this merger. One need only do a quick comparison of the demographics of users visiting each site (here, I’ve done it for you: Everyday Health and Revolution Health) to see that there is a huge overlap.

Which may not necessarily be a bad thing, at least according to a recent comScore PR. According to comScore the healthcare information content category is growing 4x the Internet norm. Having listening to the last couple of WebMD quarterly conference calls, there is certainly a lot of money to be made here as companies look to tap into the growing trend of consumerism in healthcare. One particularly “hot” market opportunity are all those pharmaceutical firms who are looking for new ways to reach and educate the end consumer beyond traditional media.

WebMD is the proverbial 800-pound gorilla in the market and the strategy here may be to simply combine forces to more effectively compete against WebMD. As the figure shows, however, even combined, these two will still trail WebMD in impressions. (Note, I used Quantcast, one of many Internet traffic tracking solutions and ther numbers may not match up with others.) Pretty weak justification for a merger, unless of course one of the parties (Revolution Health) is making the offer so sweet (little or no cost to Everyday Health) to be too tempting to pass up.