• by Mark Walsh  @markfwal, March 9, 2009

Stardoll, the virtual doll site for tween girls, is merging with teen social network Piczo to form the base of a new vertical network--along with gaming-focused site Paperdollheaven.com--allowing brands to more easily target teen and tween girls online.

The Stardoll Network is among the latest efforts to aggregate traffic around a specific demographic, and follows the strategy of other vertical networks such as Glam Media and Martha's Circle. With publishers under growing pressure to maintain ad revenue during the downturn, that strategy becomes all the more attractive to sites that are aiming to ramp up audiences fast.

"Our goal has always been to create places online where girls can have fun, learn, and make friends from all over the world in a safe environment," said Stardoll CEO Mattias Miksche, in a statement. "In just three years, Stardoll.com has become the most popular online destination for this demographic, and we are excited to strengthen our offering by adding Piczo and Paperdoll Heaven to the network."

Launched in 2006, Stardoll.com became popular with girls worldwide by letting them dress up celebrity dolls and avatars with clothing and accessories from real and virtual brands. Growing quickly to 27 million registered users, the Stockholm, Sweden-based company has raised $10 million to date from investors Index Ventures and Sequoia Capital.

Piczo, also launched in 2004, caters mainly to young teens and has raised $11 million from U.S. Venture Partners and Mangrove Capital Partners. The San Francisco-based company says it has 30 million registered users.

"Joining the Stardoll Network is a great way for Piczo to continue to grow and offer both a unique product for the teen audience and an even more valuable proposition for advertisers seeking to reach that audience," said Piczo founder Jim Conning, in a statement.

The new network will reach a global audience of more than 20 million people monthly between the ages of 5 and 20, according to the company. Comscore, however, estimates the companies' combined U.S. traffic as of January at only about 3.4 million.

It also shows that Stardoll's monthly traffic has dropped 5% to 2.2 million from a year ago, while Piczo's has nearly doubled to 1.2 million. Measurement service shows an even bigger decline in Stardoll's U.S. audience, dropping from almost 2 million in August to 1.3 million at the end of January. Merging with Piczo could help to offset any slowdown in Stardoll's audience growth.

Highlighting the impact of the uncertain economy, the company closed its New York office in January.