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Magazines > Searcher > July / August 2003
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Vol. 11 No. 7 — July/August 2003
COLUMNS
Emmerce: Small Content Providers
by Tara Calishain
Editor
, ResearchBuzz

When you think of content providers on the Net, you're probably thinking about the big guys: Ancestry.com. Gale. The Wall Street Journal. As paid content has nudged its way into the online consciousness as an acceptable practice, lots and lots of companies are lining up to offer their wares.

But they're not all big companies. In fact, plenty of content companies out there don't have hundreds of employees, don't run commercials on CNBC, and concentrate only on one niche. A lot of little guys offer big content. And we can learn some lessons based on what these companies offer and how they expand into the online information market.

From the Sublime to the Ridiculous

When you think of online content, you think of serious things, like genealogy information and Books In Print. You think of helpful, useful sites. You tend not to think of a guy renting his chest for your personal message at only $20 a pop.

Chris Pirillo, Webmaster of Lockergnome [http://www.lockergnome.com] effortlessly spans the gulf between the sublime and the slightly ridiculous. Pirillo's online content offerings include Lockergnome.com, which was started in 1996 and is largely an advertising-supported network of e-mail newsletters, and RentMyChest.com, in which he accepts money by PayPal and writes things on his chest, then takes pictures of said chest and puts them up on his site. (The kind of description this site deserves defies the staid confines of an "Emmerce" column. Please visit the site yourself if you wish and let the adjectives fly.) The company itself contains only a couple of full-time employees — most of the team is contract labor.

Pirillo's more traditional content can be found at Gnometomes [http://www.gnometomes.com], which was started in 2002 and sells a variety of e-books (including a book I co-authored, Poor Richard's Internet Marketing & Promotions). The books run the gamut from discussions of weddings to discussions of Windows. Pirillo sees the extension from Lockergnome to Gnometomes as one of evolution. "In recent years, we've had to get creative with our positioning. Hence, the extension of our brand into e-books (nothing more than repurposed content from earlier missives)."

Despite the dot-com meltdown, Pirillo does not consider the Internet naturally hostile to paid content. "Online ventures have failed for many reasons, primarily because they adapted to the climate incorrectly. Instead of embracing their audience, most dot-coms have offended them beyond salvation. We've introduced several revenue-generating projects without alienating our supporters. Right now, we have plans for evolving ancillary projects. My faith in electronic delivery is pretty strong, so I'd imagine that's the route we'll continue to take."

There are literally thousands of books published a year — some online, most not. Many of the books are published by multi-national companies with million-dollar budgets and lots of marketing. Does Chris Pirillo feel the pressure of competition from these much larger entities? "Sometimes," he says. "There's a perceived value placed on anything a more recognizable name has to offer. What we have is integrity, experience, and an active audience. Our brand is still growing, and it will continue to grow."

One of the things I personally appreciate about Pirillo's efforts is that he's continually pushing, trying different things — OK, some of them are weird. You might not find the RentMyChest idea your cup of tea, but don't miss the idea here: What odd and offbeat things could you do with your content? What have you not tried just because "no one else is doing it"?

Niche Nestling

While Chris Pirillo continues to push the envelope of content diversity, other content providers find themselves snugly and happily in one niche. Tim Carter's "Ask the Builder" concentrates happily on home building and remodeling content.

AsktheBuilder.com is a home building and remodeling content Web site launched in 1995. Originally, the site operated as an advertising supported site, and as Tim Carter says, "AsktheBuilder.com is still a content Web site that does e-commerce. It is not an e-commerce site that has some content."

The site both sells products related to building — sample blueprints, CD-ROMs, and so on — as well as original e-books written by Tim Carter on various aspects of home building and remodeling. A nationally syndicated columnist, Carter also has an archive available of his "Ask the Builder" columns. He has made traditionally offline endeavors, like the syndicated column and a radio program, blend in very well with his online site.

Carter still sells some advertising, but he's putting a lot of his future in more paid content. "My biggest push now is the expansion of my e-book offerings. I hope to have 100 titles for sale within the next 30 months. [Currently there are five e-books available.] E-books are the future. People get accurate, colorful content that helps them solve their problems instantly."

Unlike Pirillo, Tim Carter doesn't feel like he's competing with the big guys. "Without sounding pretentious, I feel I am one of the Big Guys. Search the Internet and you will look long and hard to find a content site that has the depth of AsktheBuilder.com. But don't think that I am going to slack off for a moment. I realize that competition is as constant and powerful as gravity. It is there and always trying to pull me down."

Outlandish Info

Tim Carter isn't the only syndicated columnist selling content online. But while he focuses on home building and remodeling, Randy Cassingham writes newsletters about news items so unlikely that he had to name his newsletter, This is True.

This is True is one of the old-timers of online publication, having started in 1994. The first compilation book followed in 1995 with the paid upgrade version following in 1997. This is True now has a free version and a paid version.

Despite the fact that the paid version was created in 1997, Cassingham was prompted to create it by an advertising crunch. Not the one that existed — the one he foresaw for the future. "I realized that there had to be a crash in advertising — by 1997, the Web was really growing, and there were plenty of e-mail newsletters popping up. That created a nearly unlimited supply of places to advertise, and I knew that the 'supply and demand' equation looked very bad for ads in the long run, even though there were plenty of dot-com 'experts' who didn't think so." The paid version of Cassingham's newsletter is ad-free, a feature he figures appeals to subscribers.

Though Cassingham's newsletter is very famous on the Internet, with readers in over 190 countries and a wide variety of media coverage, that doesn't stop him looking for more revenue opportunities. His "Get Out of Hell Free" cards, which arose from a letter from a reader condemning him after a story about feng shui, have taken off more than Cassingham expected. "The cards were designed to merely break even, since it's more of a viral marketing concept, but people are buying them in such huge quantities they turned into a profit center." From cards he went to t-shirts and, within the first 6 weeks of their introduction, had sold over 1,000.

The lesson here is that one should always keep one's eyes out for new opportunities. It doesn't seem a given — or even likely — that a newsletter about unlikely occurrences would lead to "Get Out of Hell Free" t-shirts. Randy Cassingham seized that opportunity quickly and it worked out very well for him.

Got Game?

At this point we've looked at content which might seem traditional even on the Web — e-books don't differ that much from print books except for format and distribution. A newsletter is a newsletter both on and offline. So where does the line exist? Can a game, for example, be content? When it's available by subscription, I think so. And if you think that Everquest or gambling sites are the only types of paid games online, you're a little off base.

CleverMedia has been creating Web-based games using Shockwave and Flash for over 7 years. Until recently, the company worked with large clients, who would buy a license to place a customized version of the game on their Web site. And, like many sites, they also had some advertising-supported content.

When the advertising market went south, CleverMedia tried to sell downloadable games using the "Shareware" approach. This was modestly successful. More recently, it has created a new online service. Homepage Arcade [http://www.homepagearcade.com] allows individuals and small companies to place CleverMedia games at their own sites. CleverMedia offers more than 60 games this way.

"We charge based on time and number of plays," said Gary Rosenzweig. "The $99.95 price gets the subscriber 1 year or 10,000 plays, whichever comes first. The subscriber can place one, some, or all of the games offered at their site. Some subscribers just want one game, while others create a whole arcade of games." CleverMedia manages this offering with two full-timers and a couple of part-timers who come in on an as-needed basis.

While Rosenzweig seems comfortable with games as the core of his approach, he feels the need to continue trying different things to generate revenue. "We definitely need some direct revenue streams like this one. Without them, we would not be able to support any new development at all. We'd be in mothball mode, I guess." At the same time he doesn't try to anticipate revenue. "We just decided to create the best product we could and see what would happen. We felt that the response was too unpredictable to come up with any realistic expectations in advance. We have about 100 more games that could be added to the service. We are also thinking about adding some customizable games, if we can figure out how to keep the cost of those games down."

Rosenzweig feels keenly the competition of the "big guys," but at the same time he realizes that some of his competition comes from a different quarter (pardon the video-game pun.) "Some of these big sites offer their games for free, in return for links and advertising, usually built into the games. Some large companies are also offering cheap game licensing. But ... the 'little guys' are actually more of a problem for us. There are some people that are making games as a hobby and then licensing them for next-to- nothing or free. We are offering a more professional and supported product, but for some sites, these cheap games are 'good enough.'"

Rosenzweig has taken a fairly straightforward concept — games — and repurposed it toward a variety of audiences. How could you repurpose the content with which you work on a daily basis?

Better Searching Through Better Tools

Games are fun, and newsletters are fun, and e-books can be both fun and useful. But what about services that actually help you perform your online activities more efficiently? Marc Fest's QuickBrowse and OnlineHomeBase.com are aimed at the online researcher in you.

If you've been doing online research for any length of time, you may have bumped into QuickBrowse.com, which allows you to combine multiple Web pages into single ones for faster viewing. This service launched in 1999. Its sister site, OnlineHomeBase, launched in 1992, supports the on-the-fly creation of notes and reminders and also serves as a collaboration area.

At the moment, QuickBrowse has a subscription fee, but OnlineHomeBase does not. OnlineHomeBase will convert to a pay service when frequent users reach a preset number. Fest doesn't anticipate any complaints. "Users have started understanding that charging for a site is a prerequisite for the site to stay up. OHB users actually send me e-mails saying I should start charging so that the service does not go away. This reflects a change in the way Internet users think about for-pay sites. They used to think they're immoral. Now, if they appreciate your service, and if there are no free alternatives, they want you to charge, because they have learned that you might disappear otherwise."

Fest doesn't feel that he's competing with the larger content providers — "I'm targeting very small niches" — but is always looking to expand.

One of the advantages that Fest has over some of the other content covered in this collection is that he offers a research service. If you start to rely on using QuickBrowse, for example, you're not likely to quit using it. Further, since Fest's offerings are so niched, it's not likely that competitors will quickly come to the fore.

Firm Data Packages

But that can also be the case with content. With "dense" special content — a variety of information gathered into one package — a potential competitor would first have to match the volume of information available and then distinguish it from the already-available content. Anne Holland of Marketing Sherpa focuses on this kind of "information-dense" content: case studies and marketing information for corporate marketing professionals.

Despite the fact that Marketing Sherpa does sell a lot of content in the form of reports, Holland found that her revenue expectations didn't work out quite as she'd anticipated. "At first we expected we'd be 90 percent ad-supported and sell a little content product. Then it reversed. As the ad market gets better, it will probably even out."

That doesn't mean that she doesn't have a good handle on current revenue expectations. "We'd go under without sales revenue. Period. We have specific goals for report divisions (buyer's guides, how-to reports, individual articles, etc.) and overall monthly and annual goals. "

Reader response has been very good. Sales started experimentally in July 2001 and produced substantial revenues in 2002. Holland finds that she gets almost immediate feedback from her customers. "If a report is slightly off target, the sales slump to nothing immediately. You have to be smack dab on target for this to work. Really close to your marketplace."

Holland acknowledges that she competes with the "big guys," but, at the same time, appreciates her small company flexibility. "As a small company I don't have the overhead the big guys do, so I can be a bit of a bottom feeder. They require say $50,000 in sales to make a project work out, I can get by with say $10,000. So I can do small niche reports that sell OK that would not be worth the time of day to the big guys."

"The key," she continued, "is in keeping your quality high. If your quality is high but you serve just a niche they wouldn't bother with, then you can win."

The quality key sounds like a good key for everybody providing content online.


Tara Calishain's Email address is tara@researchbuzz.com.
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