March 01, 2001
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ContentBiz from MarketingSherpa.com
(((((((((( March 1, 2001; Vol. II, Issue 9
Please forward *without* cutting.
Free subscriptions at http://www.contentbiz.com
1) NEWS: NewsEdge Seeks Web-Only Content; Fidget.com Overcomes
Disaster; e-Space and 4Content Partner
2) CASE STUDY: PreachingToday.com: The Story of a Profitable
Subscription Site
3) REVISED CASE STUDY: ChristianityToday.com: How a Free Content
Site Becomes Even More Profitable After a Redesign
3) More MarketingSherpa.com Headlines
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NEWS
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* ContentBizTalk Update: More Than 400 Members!
More than 400 publishers and industry vendors have joined the new
ContentBizTalk email discussion group so far. Current
discussions include: tips on licensing online content to print
outlets; paying freelancers for online rights; and opinions on
Jupiter's announcement that house-ad clutter hurts online ad
performance. To join this moderated list and/or read archived
messages go to:
http://orion.sparklist.com/scripts/lyris.pl?enter=contentbiztalk
* NewsEdge Proactively Working with Web-Only Publishers; Also
Seeks to Distribute Video with Transcripts
Charlie White, VP Content Services for 11-year old content
distribution and syndication firm NewsEdge, admits old guard
distributors have been wary of working with Web-only publishers.
He says, "The barrier to entry to becoming a content site has
gone to zero. People are always looking for validation of
content and that's been success in print."
However, NewsEdge has recently seen the light and are now
actively seeking "accurately-written" business-oriented content
from Web-only publishers. There are no frequency or story-number
minimums, if the content is right for NewsEdge's customers. Web
publishers will also appreciate the fact that NewsEdge has a
healthy corporate enterprise and intranet customer-base as well
as selling to public Web sites. Yes, you can choose which of the
two - private vs. public - your content will be sold to.
NewsEdge is also seeking audio and video business content.
However, White is careful to note, "I don't think anybody's
interested in video by itself. When people are in search mode,
they don't want to search a video, they'd rather search text.
Everything starts with text, if that's interesting then the end
user may click to video." So, he's generally only interested in
video that's accompanied by a text transcript.
How much cash can you make selling content to NewsEdge? White
can't say for sure, but he boasts, "We're a $70 million business.
We pay out more in royalties than ScreamingMedia and iSyndicate
make in total income combined." For more info call 781.229.3000
or visit the link below:
http://www.newsedge.com/publishers/become_publisher.asp
* Fidget.com Overcomes VC Funding Disaster
Last June email newsletter publishing company Fidget.com thought
they'd won. Despite the fact that VCs were getting more nervous
about the market by the minute, Fidget.com got a commitment for a
total investment of $3 million. Co-Founder Sharon Gillenwater
who'd started the company working from her kitchen nine months
before, found herself swept up by the typical post-funding rat-
race. She hired 12 staff members, rented office space, and spent
cash on marketing campaigns to ramp up opt-in subscribers more
quickly. Meanwhile the stock market continued weakening, and
despite having their strongest ad sales month ever, mid-way
through November Fidget.com lost their funding.
Gillenwater found herself alone in the midst of the Holiday
season, struggling to keep newsletter issues going out in order
to meet advertising commitments. During that "tortuous" month
and a half, she seriously considered shutting the company down.
She says, "I was ready to just hang it up and say forget it, I
was so traumatized."
However, she couldn't forget the reasons she'd co-founded Fidget
in the first place -- not to get rich fast but to serve a need.
A former freelance writer, Gillenwater felt most of her
competitors paid lip service to great content, but didn't really
provide it, and ultimately didn't really care about their
relationship with readers beyond monetizing it. She says, "We
focus on excellent content. Not a bunch of links. Not an excuse
to run ads. For our writers, the real joy is to email their
readers."
So January first 2001, she made her decision. Fidget.com would
continue, but with a different strategy, "We're not going to try
to grab eyeballs by spending a lot of money. The conventional
wisdom last year was that you have to get big and crush your
competitors. Now what we're seeing is profitable businesses are
more valuable."
By the end of February 2001, Fidget.com made its way back to the
place it had been in June 2000 just before receiving VC funding:
break-even with profitability right around the corner.
Gillenwater says, "The business is finally on solid footing
again. It makes me wish I'd never even sought funding."
http://www.fidget.com
* e-Space and 4Content Partner to Fight for "Pan-European
Supremacy"
The UK's e-Space and Germany's 4Content signed a mutual content
licensing agreement to take on the other players in the "Pan-
European Supremacy" battle -- including ScreamingMedia,
iSyndicate and Dutch firm YourNews. Tim Satchell, e-Space's
Content Publishing Director told us his company's two advantages
are (1) the fact that they have a bespoke content arm and so are
able to offer Web sites completely original content as well as
syndicated selections and (2) they're not American interlopers so
they can get the Union Jack vote.
e-Space does have distribution agreements with several US content
players including AccuWeather, uClick and United Media. Yes they
are also open to carrying other US content that's "relevant to
the European market." Contact Satchell at: Tim.Satchell@e-
space.co.uk or call + 207.236.5900. BTW: Never fear about
calling 4Content on the phone, Satchell told us they speak fluent
English.
http://www.e-space.co.uk
http://www.4content.de
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CASE STUDY: PreachingToday.com - The Story of a Profitable
Subscription Site
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CHALLENGE
Christianity Today International has been running a
profitable free content site online since 1994. Although the
site appealed to a broad consumer audience, market research
showed that a solid 20% of visitors were professional pastors.
Also, the organization had a history of success selling offline
resources to pastors, such as books, audio-tapes and CD-ROMs.
So, after a great deal of internal thought and discussion, the
organization decided to take the plunge and experiment with a
subscription-based site.
John LaRue, VP Internet Research & Development, says,
"Advertising is good for this market segment, but we didn't need
another product to generate traffic to sell it. We already have
other areas for church leaders where we're selling ads. In fact
like anybody else we tend to have more space online then we can
sell. I kept asking if this should be free, but the market
research gave us an indication of what percent of the audience
would pay and the numbers were really good compared to other
products -- both online and print."
CAMPAIGN
Despite the fact that Christianity Today has been in
business since 1956 and as LaRue says, "We understand our niche
pretty well", the team did not make any assumptions going into
the development process.
First they carefully surveyed pastors both by direct mail and by
email. LaRue says, "The mailed version was a four-page
traditional survey with a whole bunch of ideas. This helped
develop which concepts came out on top. The online one was
smaller and helped refine the features."
Results showed that pastors were willing to pay for easy-access
to illustrative stories, quotes or facts (known as
"illustrations") that they could incorporate into their sermons
to bring their message to life. LaRue says, "Pastors are
constantly in need of materials." So, the new subscription site
-- entitled PreachingToday.com -- was built around a database of
3,500 illustrations fully searchable by topic and bible verse.
Plus, paid subscribers would receive 10 new illustrations per
week via email. Additional content included an online journal
featuring skill-building articles written by some of the best-
known preachers in America.
The site launched late 1999 with a direct mail campaign. The
initial piece was a double postcard offering a 30-day free trial
for $39.95. Copy included endorsements from a range of
"celebrity preachers" to appeal to both evangelical and
mainstream pastors.
In addition, LaRue promoted the site online by placing
promotional banners on sister-site ChristianityToday.com and
including announcements in the site's appropriate free email
newsletters. PreachingToday.com's visitors who weren't sure
about paying for content had the option of receiving a free
newsletter featuring just one weekly illustration and tantalizing
headlines for the remaining nine. Buyers had their choice of
three paid subscription levels: Basic (just the ten weekly
emailed illustrations) at $19.95, Enhanced for a bit more and
Premium (including the searchable database) for $39.95.
After a year, PreachingToday.com raised its premium price to
$49.95 to reflect the fact that the site's content had doubled in
size. The site began renewing initial subscribers in October
2000 by sending an emailed, opt-out announcement 30 days before
automatically billing subscribers' credit cards for another year.
LaRue's "wonderful" customer service person followed up on all
expired and changed cards via email and phone.
RESULTS
LaRue says, "We exceeded expectations the first year.
PreachingToday.com is budgeted to generate more than $400,000 in
revenue with a gross margin of 25% for the 2001 fiscal year. We
currently have 7,500 paid subscribers and have seen no slow down
in the growth curve since we launched."
95% of subscribers chose the Premium subscription (formerly
$39.95, now $49.95.) About 5% of subscribers chose the $19.95
Basic subscription. Almost none chose the middle, "enhanced"
subscription, so this option was dropped fairly early on. The
site's renewal rate is currently a healthy 60-70%. Traffic has
steadied to about 42,000 home page impressions a month, with four
to ten times that many impressions on other subscribers-only
pages. LaRue says, "We know pastors are going in there."
Direct mail campaigns were definitely successful; however, LaRue
learned not to put a phone number on the postcards. He says,
"Registering people by phone became a customer service nightmare.
Some people thought they could sign up for it but they didn't
have to be online." Now all responses are driven to the Web
site, and from there visitors can find a number to call customer
service if they want to.
Due to the success of PreachingToday.com, Christianity Today
International is planning to develop two more paid content sites
in 2001!
http://www.preachingtoday.com
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REVISED CASE STUDY: ChristianityToday.com: How a Free Content
Site Became Even More Profitable After a Redesign
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NOTE: As you may remember, last week we ran a Case Study about
ChristianityToday.com. Due to some honest confusion, we got a
few of the facts wrong. After the site's Promotion Manager Mike
Herman set us straight, we felt some of his insights were
interesting enough to warrant our sending you an entirely revised
Case Study (rather than just running a boring correction.) So,
here you go!
CHALLENGE
Christianity Today International, an organization
founded by Billy Graham in 1956 that publishes magazines, books,
church resources and CD-ROMs, launched its first interactive site
in 1994. The site was first solely part of AOL, and then it
migrated to the Web, changing names a few times on the way to
finally become ChristianityToday.com.
Like many other publisher's sites at the time, this one was
basically shovelware (supplemented with some community features.)
On a regular basis the Webmaster would add fresh articles taken
directly from the print magazines and that was about that.
However, unlike many other sites, this one was mildly profitable
within about 12 months of launch and remained so thereon.
By May 1999, the in-house online team at Christianity Today
International badly wanted to redesign and upgrade whole site.
They had two challenges:
1) They needed to please and meet the needs of their already
loyal visitors and advertisers.
2) The changes needed to add up to increased revenues almost
immediately in order to cover any increased costs. While
Christianity Today International is a non-profit, they didn't
want to lose money - especially with something already making a
profit!
CAMPAIGN
The team decided to take their time and get it right.
Online Promotion Manager Mike Herman says, "It was a 15 month
process. We redesigned the redesign a number of times! There
were times we just tore it all down on our end. Our live site
wasn't getting a lot of upgrades, but we did have to keep that
going at the same time. So, we put a lot of energy into this."
The team, led by John LaRue VP of Internet Research &
Development, researched current visitor preferences by sending
out surveys to the site's 150,000 opt-in email newsletter
subscribers. They also "scoured" site usage reports to learn
exactly which types of content were consistently popular. Herman
says, "This helped us develop content by felt need so people
could find what they were looking for, instead of having our
content organized by issue date." The redesigned site organized
content by channels such as "Teens", "Parenting" and "Your
Spiritual Life." Fresh content, repurposed content from print,
online chat, online advertising opportunities and ecommerce
offers were all integrated into each channel by topic.
At the same time, the team redesigned the back-end systems
including consistent style sheets and templates so the site would
be more efficient to maintain and update. Rather than investing
heavily in ecommerce infrastructure, LaRue decided to continue
outsourcing the site's store by using a $300 per month private-
labeled store from Yahoo.
To generate more traffic and grow opt-in email lists, LaRue
formed a partnership with DaySpring.com, a subsidiary of
Hallmark. DaySpring.com created and powers a special
"Encouragement Cards" site area where visitors can email virtual
postcards to their friends. LaRue says, "When people send a
card, they can opt-in to getting the newsletter. Then when their
friends come to the site to pick up cards, it's branded with our
left-hand navigation so people can visit the site from there."
Next, LaRue added pop-up boxes to the site's home page and major
channels offering free email newsletter subscriptions. Each box
places a cookie with a 15 day expire on visitors' PCs so folks
aren't annoyed with pop-ups on a daily basis. Here's the clever
part -- when folks subscribe for free newsletters, the next page
that pops up to thank them also contains a free trial offer for a
paid subscription to one of the site's sister print magazines!
Now that the site and its accompanying email newsletters were
organized into topical channels, LaRue was able to place house-
ads for specific Christianity Today products in context. For
example, an ad for a women's Bible runs in the women's section.
He also created a new media kit so the ad sales team could offer
outside advertisers more targeted sponsorship packages. Plus,
after noticing that educational institutions were among the
site's most loyal advertisers, LaRue added an ad-based online
directory to Christian Colleges and seminaries. Schools pay a
flat rate of $2000 to be listed for one year.
Last but not least, two months after the redesigned site launched
LaRue decided to kick product sales up another notch, by sending
opt-in subscribers a monthly broadcast email focusing on a single
special offer for a particular Christianity Today product
available at site's store.
RESULTS
The completely redesigned site, launched October 2nd,
was almost instantly more popular and profitable.
Traffic shot up from 2.5 million pageviews in September to 3.5
million in October and 4.1 million in January. The site's
ecommerce sales also immediately rose, from $13,000 in September
to $18,500 in November and $28,000 in January. About 15% of
visitors who used the pop-up to subscribe to email newsletters,
then also signed up for a free trial to a print magazine on the
thank-you page -- so print magazine sales will grow too.
The eCards are steadily growing more popular. They generated
about 100,000 pageviews in October and are projected to generate
more than 300,000 pageviews for February 2001.
Ad sales held steady at about 25% inventory sell-through (a
respectable amount for a consumer site) despite the greatly
increased inventory. The school directory listings program has
been particularly successful. LaRue says, "Now we have 60
schools sold and we anticipate that growing to 100 this year.
It's still an experiment, but it seems to be a success."
LaRue tracks the site's profitability by a variety of metrics.
He's found the site makes approximately .50-.60 cents per year in
ad and product sales per opt-in email subscriber. He's also
discovered each site user session is currently worth about 10
cents in ad and product sales.
LaRue's advice for other free content Web sites? "The overall
key to success is to know your niche and develop a revenue model
that works for it. The key to our free content success is to be
able to generate income from multiple revenue streams, which
include advertising, magazine subscription sales and our own
product sales."
http://www.christainitytoday.com
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View past ContentBiz issue archives at:
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