Thanks for the good read, Jason. I'm looking to build a newsletter for my travel site and am always looking for examples of companies that are having success with one.
Another company that is doing really well with newsletters is Dogster. Sarah Lacy interviewed the Dogster founder for Yahoo a year or so ago and I was amazed to discover how lucrative they can be.
Great post Jason. I was chatting with a colleague about this and he used to work for a small-ish NYC-based mailing list that focused on high-income young professionals.
He mentioned that the metrics advertisers were sold on (subscribers, CTRs, bounce rate, etc) were largely embellished and misrepresented. It seems like these numbers would be easy to fudge and that advertisers would rarely ask for further documentation (even analytic screenshots can be misrepresented). Are people finding this a concern among advertisers?
So the media kit #s were fudged (not the selling prices)? Most media kits on the site are out-dated, but you should obviously have an updated one for distribution.
I'm sure people do this. Kind of scummy, but if I were an advertiser I'd want to see something valid. If I were running a list or considering creating a startup like Dailycandy, thrillist, ideal bite,etc. I'd build a great system for advertisers that somehow ensured my numbers were legit. (there's a hint somewhere in this comment).
There have been some attempts at setting up an auditing system (as there is for newspapers), but they never took off, and I don't think that's really the issue.
Ultimately, advertisers can tell if there ads are working because they get more hits, more leads, and more sales. For most clients, if ads are generating sales, it doesn't really matter what the CTR is.
It's like any business. Sure, you can lie to make a sale, but don't expect many repeat customers.
And most advertisers (and all ad agency clients) also do their own tracking on click-throughs. Many also track image loads.
(Open rate is the other big metric. If you're doing a branding campaign, you want to know how many people saw your ad, not necessarily how many clicked on it.)
You don't have to run an email newsletter to make money in this business, either. Check out this very cool (and successful) piece of Mac software by HN user jhammer:
My employer makes most of its money on free business-to-business email newsletters. Advertisers love them because they're very targeted (only people who really care about a topic are going to want to subscribe to a daily newsletter on it). They're also much more personal than a web banner ad and, in some ways, easier to track.
And because marketers are more confident that potential customers are in your audience, they are willing to spend at CPMs that are very high compared to the web.
One interesting thing to note is that pretty much everything that's in the email newsletter is also posted to the web (and there's even a full text feed!), but lots of people prefer getting it as an email anyway.
We now obviously make money from web ads, webinars, conferences, etc. But for years we were only an email newsletter company.
Incidentally, we're one of the very few media companies (let alone b2b media companies) making money right now.
"Incidentally, we're one of the very few media companies (let alone b2b media companies) making money right now."
Not every media company is a dying newspaper, and a lot of them besides yours make money. Unless you have access to the finances of thousands of private companies, you should really think a second before making such statements.
You're right, it's a sweeping generalization that I probably shouldn't have made. And obviously this is just my opinion.... But I still think it's true.
Sure, plenty of people are making money, but the biggest piece of the B2B media industry is print magazines. And print magazines stink bad enough to wipe out any modest gains in online ad sales for the many companies unlucky enough to be stuck with legacy print pubs. B2B ad pages are down 30% just in the first half of 2009. And that's after a crappy 2008.
I'm not sure if this is the kind of feedback you want, but I didn't really read that article because the text was fairly small. Laziness on my part yes, but I'm sure I'm not the only one. Sorry for giving you unsolicited typography advice, I just thought you might like to know :)
Just switched to a new design a few weeks ago, and this is the first new post, so actually great feedback. Just increase the size or change the font with it as well? thanks sean.
Yes it was. I was looking into that last week, but forgot about it. Update: Added it in as a bonus case. Credit gave to coglethorpe for the reminder. Gracias!
I've been using Vision 6 [1], the biggest one here in Australia. Started writing my team's weekly business email about 12 months ago - it adds value to my clients, and both potential and alumni clients get great value from work which is scalable. 'Nobody' visits my blog, but hundreds open my email each week.
Oh sure, and feel free to link us, but kindly leave my name off the webpage :)
FierceMarkets, and we're in a bunch of industries. For example: http://www.fiercebiotech.com and http://www.fiercetelecom.com
One interesting thing to note is that pretty much everything that's in the email newsletter is also posted to the web (and there's even a full text feed!), but lots of people prefer getting it as an email anyway.
We now obviously make money from web ads, webinars, conferences, etc. But for years we were only an email newsletter company.
Incidentally, we're one of the very few media companies (let alone b2b media companies) making money right now.
Email seems so old compared to new tech available with instantaneous feedback. A good startup idea would be to redefine email. Email 2.0. Not unlike google wave.
Emails work well because of the 'Echo Effect.' Basically meaning: You are reminded of something without having to do anything. Think of the product 'Head-On'. Though their commercials are annoying, you will never forget them...in fact, you probably are finding yourself saying/thinking it right now... Head-On Apply Directly To Your ForeHead
The beauty of the Echo Effect is that people are constantly reminded and people eventually think of your product/concept. So even if they just go to your website once, they will more likely be repeaters as long as they are given incentives to remember.
Emails are the original "push" and it still works. The "FWD:" is like the original retweet. Emails are part of nearly every person's life in the modern world at varying degrees.
How can Email lists not be successful? It may not be sexy, but it's real.
Another company that is doing really well with newsletters is Dogster. Sarah Lacy interviewed the Dogster founder for Yahoo a year or so ago and I was amazed to discover how lucrative they can be.
Link to the interview here: http://blog.dogster.com/2008/12/01/sarah-lacy-interviews-ted...