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AM: Customer Acquisition via the Web- The Fool responds

To:     "'marketing/advertising discussion group'" <>
Subject:     AM: Customer Acquisition via the Web- The Fool responds
From:     Mitch Arnowitz <>
Date:     Thu, 21 May 1998 15:29:02 -0400
Organization:     Morino Institute
Reply-To:     "" <>

Hi Mitch,

I apologize for the delay in getting back to you - a few things came up
yesterday that I had to deal with and I couldn't respond sooner.    

I read through messages you sent and have a couple of thoughts off the top
of my head on the situation, although it is quite different than what the
Fool faces because we are coming from different directions.  In trying to
generate subscriptions, there are two things that we know do not work:
banners ads and random e-mails to large lists.  We have found success,
judged both by increased subscription numbers and no-to-low cost, by giving
"teaser" content to other websites with a prominent link to a subscription
page (It should be noted that teaser content has to have its own inherent
value to be effective). 

It is not revolutionary that in order to get people to pay for content, you must
get them to want the content.  To do this, the easiest (and cheapest) way is
to offer a sample.  The websites you choose must be carefully selected to
reflect the market you are trying to reach -if you write on financial markets,
you want to be on financial sites. 

The good thing for companies like The Motley Fool is that well-written 
content is in high demand on the Web.  In effect, the Fool gets paid to 
advertise because the sites we license content to shares revenues with us.  
We have even had success selling subscriptions to a weekly product that 
simply reprints what we offer for free on the Web and sends it out in an 
e-mail -people are paying strictly for convenience.  This type of product
can only work when readers are hooked on the content.

Site licenses to universities makes sense to me - I would give a subset of
the content to the universities for free, using it as a vehicle to gain
subscriptions for the full product.  If you are not charging them for the
content, then the deal can be structured in such a way as to drive traffic
to the sign-up pages.  There is a very large untapped audience of
web-connected users at universities.

Generating a decent community that is self-sustaining is tough and a
labor-intensive project.  There is more to it than just providing the means
- the area must be seeded by the hosts.

Offline promotion and advertising, in my opinion, is crucial.  We have had
much success with offline advertising and can see spikes in traffic on the
days that ads run.  Of course, keeping true to our model, we do not pay for
advertising.  Instead, we struck a deal with UPS to syndicate a newspaper
article in 130+ newspapers nationally.  We have seen that there is not a
major disconnect between mediums.   

I hope the above helps although I do realize that the Fool is in a unique
position and this may not apply to the site in question.


Bernie Dietz
Business Development
The Motley Fool

> I've had many years' experiencing in working with publishers to get new
> customers. Here is an idea or two for you to think about. Traditional
> newsletter publishers rely 100% on direct mail as their new business
> generator. And they are finding it harder and harder to make direct mail
> work. The economics are a killer. Controlled-circulation (advertising
> supported) pubs who switch to the paid-subscription model have a tough row
> to hoe. List rental is absolutely the key, and the offer has to be well
> structured. And then you have to do renewals--the real money is in the back
> end, the renewals. The newsletter publishers who have been my clients
> started with products on paper and have gone to the Internet subsequently,
> offering a licensing model to subscribers who prefer electronic delivery.
> Most publishers who have a website drive readers to it by promoting the URL
> in the print publications they send out. The Net is also terrific as an
> archive available on a paid basis. 

> Motley Fool has been experimenting with print, and may provide an
> instructive model as a business that started out e-based and moved into
> paper subsequently. 

> I know this just scratches the surface--it's a complex issue.

> Linda Kolker

> LeapFrog Solutions
> Board of Directors, New Media Society of Washington     
> v. 301-593-8545  f.301-593-8058

-----Original Message-----
From:	Bill Robins []
Sent:	Thursday, May 14, 1998 6:30 PM
Cc:	Mitch Arnowitz; Nancy Swanson; Terry Steichen
Subject:	Re: FW: AM: Customer Acquisition via the Web

Thanks again to everyone for their thoughts, it has been really exciting
to gain so much insightful feedback.  To give some additional
information, in hopes of inspiring more ideas and solutions.  

Our client is focused on news, politics, and culture.  They have been on
the web for close to two years, and although a print version exists, it
is not the focus.  The current subscription number is above 20,000 paid

Site licenses, "community," and off-line acquisition are three threads
that have emerged that I am interested in discussing further.  

Thus far, site licenses have posed a challenge for us.  One hypothesis
is that I do not envision a business being as interested in a site
license to our publication, as they might be in a site license for a
publication like, WSJ or Business Week.  We are in the midst of
approaching universities, regarding site licenses; does anyone know of
any precedence for site licenses and universities? 

In terms of community, there is a discussion space on the magazine;
however, it is not as fruitful as they would hope.  One idea we are
considering as adding classified ads to the pages; WSJ / Economist etc.
(in print) seem to be very successful with this concept.  

The off-line acquisition channels have caused internal debate.  One side
of the argument says that there is a disconnect between mediums, and as
a result we should not advertise on radio or in print.  However the
other side says that, we know geographically that the subscribers are
clustered, what their editorial affinity is, and that studies indicate
heavy internet usage is in addition to heavy media consumption, not in
place of it.  This suggests to me that a targeted NPR campaign would be
a logical execution.  What is the reaction?  Do you think we can do this
alone, or should we do it in conjunction with a metro campaign (in DC)
or a direct mail campaign?

I look forward to your thoughts on these topics.



At 09:05 PM 5/12/98 -0400, wrote:
>NetResponse is an internet consulting and development agency.  One of
>our clients is in the midst of planning an aggressive customer
>acquisition campaign.  The client is a web based publication, which
>recently migrated to a subscription model.
>Thus far, banner ads have not been a cost effective channel.  I was
>wondering what experiences, thoughts, or recommendations people had in
>regards to alternative customer acquisition vehicles.
>We are looking at list rental for direct email, text ads on email lists,
>and sponsorships, as well as testing off line advertising mechanisms
>(direct mail, print, and local NPR).
>Thank you-
>Bill Robins

Re: AM: Customer Acquisition via the Web- The Fool responds, Jim Harmon

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