Niche Newsletters Attract Advertisers

Wonder why such magazines as Stuff and Cargo have taken a beating? According to this LA Times piece (requires free registration), they're being pushed out by emailed newsletters like Thrilllist.com:

Thrillist is one of dozens of electronic mailing list services. Some have been around for years but new ones have been popping up recently, godsends not only for Friedman and people like him but also for advertisers.

The services, most supported by ads, reach audiences most magazines only dream of. The median household income of Thrillist subscribers, for instance, is $107,000, dwarfing Sports Illustrated's median of $63,605 and Maxim's of $65,710.

Those demographics are startling. The LA edition is already reaching over 24,000 subscribers and they're launching a Las Vegas version. These high concept service vehicles - each providing a specific take on information, often with an "insider's" slant - have got a business model that leave magazines in the electronic dust. They don't have costs for printing and only nominal ones for distribution. There's lots of research, but high end writing isn't at a premium. They only need one advertiser in an issue, as their overhead is low, and their readers don't seem to mind the ads. And they can deliver results:

After a Thrillist e-mail mentioned Astor & Black, a tailor that makes inexpensive custom suits, $100,000 worth of suits were purchased in a matter of weeks, the company said. DailyCandy said an e-mail about a movie screening prompted 8,000 RSVPs.

The email list publishers are slugging it out and competition is strong, so don't expect to enter these particular slices of the market easily - and most of them have had years at this. But if this works for these niches, why not others? If you're going to spend time on your own interests, maybe you can find a way to develop something that, over time, could turn into a business. Here are some hints that I deduced from the article:

• You need an associated web presence so people will ask for the newsletter.


• Find a well-defined niche where the population doesn't naturally churn. For example, wealthy people in LA work as a target market. Parents of infants might not, because they grow out of that particular need quickly, so your subscribers are of limited duration.


• Be respectful of the readers and don't overload the newsletter with ads. They may not mind one, but get obtrusive and you'll lose them.


• Build the audience first and then go for advertising. If you try to make money immediately without investing, advertisers will have no reason to deal with you.


• Look for people that consider their time extremely limited - whether it objectively is or not. They'll want information in a condensed fashion.


• Market the web site first to build audience, and then go for the newsletter. An audience has to be able to find you somewhere.

An Interesting View on E-Books

Tim O'Reilly is a smart book publisher, and he took a look at some of the numbers that e-book enthusiasts tossed around with the advent of Amazon's Kindle. His argument is that even if prices do tumble for e-books, it will likely be only temporary. It's worth the read.

I'll add an additional angle. Let's assume that he's wrong and prices do drop and stay at $5 a title. What publisher and author combination can make money that way? Reading hasn't reduced in volume because the prices are too high - books just aren't that expensive. If you have a current business model under which most titles don't even make back the pitiful advances that authors get, and where the cost of the actual paper is only about $1.50 a copy, then dropping the price by 60 to 80 percent is going to mean that publishers won't be able to afford to print anything that isn't going to be wildly successful.

Current backlists may stay around (if the publishers have acquired the necessary rights), but forget the variety of titles coming out now. You'll be down to a handful of authors who can generate the necessary sales. Some individual authors might be able to self publish, but if they're getting 35 percent of $5, that's $1.75. Take out costs of design and production, and maybe they're at $1 a book if they're lucky, which is the inadequate stream of money they made from publishers - too low to support self-publishing. So $5a copy, if really gutting the paper model, would actually leave book publishing virtually dead. Then supply and demand will kick back in, because there are those massive infrastructures to feed, and prices will head back up anyway.

Electronic Rights Article

I recnetly saw a Mediabistro.com discussion about electronic rights where a number of people said they found the concept confusing. There's a good reason - they are confusing. So while I'm not a lawyer, I have put together my understanding of and research into the subject. You can check the Electronic Rights link under Writers Resources in the left hand part of the web page or just click here.