Using newsletters to expand your business, introduce new products,
Want to build awareness of your company, reposition it, expand its customer base, introduce new products, and encourage repeat business? Do your newsletter right -- not expensively, but right -- and you will. Here's how
Thanks to the age of the desktop press, newsletters are inheriting the earth. The weapon of choice for legions of frugal marketers, newsletters now bombard company mail rooms as heavily as catalogs once did. You can expect them from suppliers, bankers, lawyers, accountants, consultants, printers, and overnight couriers. Followed by others from insurers, distributors, and brokers. Odds are, you even publish one of your own.
Their staggering proliferation notwithstanding (an estimated 100 million are published on the North American continent today), most newsletters never get read. Poor-quality, deadly boring, and self-congratulatory, they end up in the circular file or composting in an I'll-get-to-it-someday stack. Still, from the scores we surveyed, newsletters, when done right, can work marketing magic: they can build awareness, expand a customer base, encourage repeat business, introduce new products, help position a company, and save you a bundle in the process.
However, before you park yourself in front of your computer to churn out your first issue, take some point-ers from these smart marketers who have developed, designed, and distributed newsletters both to capture new customers and to keep the old.* * *
Glen White, owner of Scientific Information Services, of Fort Worth, knows exactly what his newsletter should accomplish. The goal: six new contracts a month. White's business -- a management-consulting firm that advises clients on hazardous-waste regulations -- is not the stuff of glamorous ads. It's so specialized, it borders on the obscure: "Not that many people would know where to begin to look for a hazardous-chemical-management consultant." Advertising and cold calling produced meager results. Chemical-company managers, his prime customers, viewed his company as an arm of the government, an enemy instead of an ally. Until, that is, White began publishing a monthly newsletter -- chock-full of information about new laws and industry trends -- that built trust, warmed sales prospects, and soon began yielding the sought-after six new accounts a month.
Like White, Nashville lawyer Brian Smith and financial adviser Rita Mitchell in nearby Goodlettsville, Tenn., wield newsletters to level obstacles to growth. For Smith, launching a specialty law practice -- in copyright and intellectual property -- meant overcoming anonymity: "I had to get my name out in front of people. Let them know I exist." It was a lesson he knew from hard experience -- an earlier attempt at starting a practice had failed. "I basically sat behind a desk and waited for clients to show up," he says. "They never came."
By publishing a newsletter, he could demonstrate expertise and establish a referral network with fellow lawyers as well as clients. In three years his practice has grown from zero to $300,000 in revenues. "I'd hate to think where I'd be without this newsletter."
Mitchell wanted to reposition herself as an investment adviser after years of brokering insurance. She'd get better margins for less time servicing accounts. But before she could tackle that challenge, she had another hurdle to clear: bias. "It's difficult to get people comfortable enough to give you their money to invest, but especially if you're black. Writing the newsletter gave me credibility. It showed people I know what I'm talking about." For the $1,000 she spent each year on newsletters, she has garnered $30,000 worth of securities business. Not a bad return on investment.* * *
Pick Your Audience Carefully
Do you want to communicate with customers only? If your goal is to get them to come back, as it is for Tom Kusmerz of the Barn Nursery & Landscape Center, in Cary, Ill., then current accounts are the obvious audience. Kusmerz sends his newsletter only to the 2,200 customers who request it. "They have to come into the store and sign up for it. That way, I know we're not wasting our effort."
But perhaps you want to introduce new products or extend your reach. Smith sends his "Smith Report" every quarter to 2,300 readers -- only a tenth are clients; the rest are prospects or referrals. He considers his newsletter an "incredible tool for getting new clients." But its effectiveness results largely from his vigilant management of his mailing list.
"Everybody who calls and asks me a copyright question goes on the mailing list." He uses directories of marketing, computer, and music-industry professionals to build his database. He buys lists from the local advertising bureau. Smith keeps careful track of leads -- friends, family, old clients -- and updates his list frequently. When he sends out his newsletters (at a bulk rate), he includes a request for address corrections and a tear-off response card at the bottom of each. "Readers can fax them back. Within two to three weeks, I always get 10 or 15 responses and the names of more leads to add to the list." And when he attends trade shows or conventions, he pays the modest fee to have his newsletter stuffed among the giveaways that go to attendees.
Beyond targeting current or would-be accounts, it may make sense to direct the newsletter to just about everyone you do business with. The Coffee Connection, a $10-million coffee retailer in Allston, Mass., sends its "Newsnotes" to 250 people on a VIP mailing list: investors, suppliers, strategic partners, food writers, landlords, developers, and bankers. "It's a great tool for bankers," says marketing director Andrew Frank. "It lets them see something besides the numbers: a live company."
Of course, there's no rule saying you have to assemble a mailing list at all. Or even deliver your newsletter by conventional mail. Drew Reid Kerr of Four Corners Communications, a public-relations firm in New York City, distributes his newsletter on-line. And it costs him nothing. That's right, zip. By sending his newsletter electronically, he avoids mailing costs. He doesn't have to buy or compile a mailing list in advance. He simply uploads the newsletter and lets those who are interested download it at a cost of only a few cents per issue. In the beginning 75 users read it. Now a couple hundred receive each issue. Kerr estimates 40% of his revenues have resulted from the on-line newsletter.
Inform, don't Sell
Whatever audience you select for your newsletter, know what it wants to hear from you. And brace yourself: that may not be the pitch on your latest product. What the readers of Kusmerz's newsletter want to know, for example, is gardening: when to plant, what to plant where, how to make it grow. They want the inside dope on rhododendrons. And so Kusmerz's newsletter delivers it -- advice and information that discount, self-serve chains can't provide.
The moral: Let the sales literature tout the products. To get read, a newsletter must add value by informing the reader. At companies such as the Coffee Connection, educating the customer is the cornerstone of marketing. "The more sophisticated customers are about coffee," says president George Howell, "the more likely they are going to stay loyal to us." So six times a year Howell crams his two-page newsletter with facts about coffee, growing regions, blends, and equipment. He also promotes the company's free coffee seminars, which are heavily attended as a result.
While the Coffee Connection pursues a soft sell with its newsletter, the information it peddles does, in fact, sell coffee. When Howell raved in his column about one blend, it shot from 10th or 11th place to 3rd or 4th among the company's best-sellers -- remarkable considering it costs $12.95 a pound.* * *
Keep it Simple
It's only too easy to make the mistake that Experience in Software Inc., in Berkeley, Calif., did. The embryonic software developer undertook such an elaborate newsletter that its maiden issue became virtually its last. President Roy Nierenberg paid a PR firm to write the four-color, eight-page extravaganza, a design firm to package it, a printer to run nearly 15,000 copies, and a mailing house to slap addresses and 45¢ worth of postage on each one. "I spent $10,000 on the first issue," says Nierenberg, who had hoped the newsletter would pay for itself with a couple of lucrative licensing deals. It didn't. "It was complete overkill."
More companies, small and large, now recognize that splashy, multipage newsletters not only cost too much but are seldom read. To avoid being consigned to those unread stacks, smart newsletter marketers take a minimalist tack and limit their publications to one or two 8.5-inch-by-11-inch pages. Consider Ed Laflamme, owner of Laflamme Services, a commercial landscape contractor in Bridgeport, Conn. Laflamme puts out his "Shades of Green" on a single sheet of paper. Articles on topics ranging from how to fight beetles to recycling grass come three or four to a page and require a few hours with a word processor and a laser printer to produce. Each issue is photocopied on newsletter stock preprinted with a two-color nameplate to save money. Postage runs $300. Like Laflamme, financial adviser Mitchell sends her missive out on a single sheet. Short, informative, formatted, it delivers tax tips or financial advice in two-line or three-line blurbs. No confusing jargon, no long-winded pitches. Just quick, readable bites of advice.
Where does the material to fill a newsletter come from? Mitchell scours financial journals, trade magazines, and business publications. Laflamme harvests useful tidbits from the horticultural press and what he observes, quite literally, in the field. Scientific Information Services pores over government documents -- a task White and his staff would do anyway just to keep abreast -- and apprises readers of changes that may affect them. In short, share the knowledge you gather as you keep up in your industry. Just condense it, or tell readers where you found it.
And don't overlook the wealth of material to be found among customers. They can serve as your newsletter's subjects as well as its readers. Mitchell gives clients coverage on the simple theory that if she puts them in the newsletter, they'll want to read it. Her clients are proving it true. "I trash 90% of the newsletters I receive," says customer Sherry Cummings. "Hers I keep in a file." Mitchell says, "The more I get clients involved, the more loyal they're going to be, and the more likely they are to send me referrals and more business."
No matter what you write about, the look of your newsletter, while important, need not be lavish. True, it may demand a slick (and costly) look if you compete in an industry -- such as retail -- where style is important. But even that's not always the case. Michael Yag, president of Access TCA Inc., in Whitinsville, Mass., a $4-million Inc. 500 company, abstains from high gloss, even though his exhibition business trades on showing marketing managers how to make a splash at trade shows. "The newsletter doesn't look as though you'll have to pay a fortune for whatever it is we're going to sell." Yag's newsletter invites the eye without suggesting there's a huge price tag attached.
You also can use colors or paper to strengthen the image you want to project. To suggest healthy flora, Laflamme, in his newsletter, "Shades of Green," uses a bold nameplate printed in guess what color. Kusmerz sends an environmentally correct message by printing his newsletter on recycled paper.
For early issues, it's OK to type on your letterhead. Best Regards, a start-up in Bonita, Calif., prints its newsletter marketing the company's custom-label wines on two pages of stationery. No more than six paragraphs long, it provides concise information about different wines and costs little to produce.
Whatever design you choose, your newsletter should look more or less the same each time. Novices can be tempted to change the layout and jigger with the design of each issue. Don't. Choose a simple format, with sections that appear consistently from issue to issue. A one-time fee of $200 to $300 should pay for a free-lance designer who'll provide a flexible and reusable design.
Format the content of your newsletter as well. Mitchell's newsletter always includes the same three sections. Access president Yag and the Coffee Connection's Howell each write regular columns. Yag's newsletter faithfully delivers a few interesting graphics and a column of industry news briefs. Soheil Zendeh, owner of GT Shop, an automotive-repair business in Watertown, Mass., leads off each issue of his newsletter with a mystery, in which he solves or traces the source of common car troubles.* * *
The best newsletters we sampled bore the strong stamp of the CEOs behind them. "No one is more tuned in to what customers want than I am," says Laflamme. "If I hired someone else to write it, I'd have to spend so much time with them. It might even take more time to explain to someone else."
Of the column he writes, Howell says, "It is the first arm by which I connect to those customers. It's my direct line." Yet he puts in only an hour to do it, delegating the rest. And the column requires no extra research time, because he writes about what he already knows -- coffee.
While CEOs should keep a hand in their company newsletters, they shouldn't overcontrol them. At the Barn Nursery, Tom Kusmerz holds seasonal meetings with 8 key people three months before each issue. There's no shortage of ideas. "Everybody wants a piece of that newsletter, because they know it will help move product in their departments." At first employees were reluctant to write articles. Now they compete for space. Eight to 10 people will contribute to each issue. "Employees get to write about something they really like. It gets them more involved in the business. And by the time each issue is done, everybody in the company knows more about a few topics." Kusmerz also gets his suppliers involved -- they provide free artwork and some dollars for co-op advertising.* * *
How will you know if anybody reads your newsletter? You could skip an issue and see if anyone notices. But it makes more sense to offer an incentive and a way for readers to respond.
Best Regards owner Alan Aegerter measures effectiveness in referrals. In a recent issue he offered readers a discount on wines if they provided the names of three potential customers. He reaped 300 leads. "If I picked a quality mailing list, I'd spend $2,000 to get that kind of response," he says. "Instead I spent a third of that." Aegerter follows up with phone calls. The sales staff make at least 10 calls a week to see if customers read the newsletter. He estimates at least half do read it. Access president Yag gleans feedback from sales calls. "When our salespeople call on accounts, at least 20% mention the newsletter." The response from customer-query cards included in the newsletter reaches a healthy 8%. Yag, who publishes his newsletter four times a year, says, "Every time, it pays for itself with a new client. After the last issue, we got two."
Kusmerz evaluates his newsletter in the return on coupons printed in each issue. The month he promoted tree wraps, he sold a year's worth in 30 days.
Garage owner Zendeh attributes his 1991 banner year in the middle of a recession to his newsletter. Each issue included a coupon offering a substantial discount. "Each time a person showed up with it, I'd track it." He recorded the amount the customer spent, then updated his database weekly. "I'd break even on new customers alone." They covered the $5,000 cost of mailing to 17,000 people. "The repeat customers would bring us way over. It paid for itself every time with new business."* * *
Look for the Extra Benefits
The benefits of a well-executed newsletter should be apparent and quantifiable: Does it bring in new business, boost sales, position the company correctly, improve conversion rates, yield better results than ads do? The answer should be yes on at least one count. Ed Laflamme attributes one contract worth $100,000 to his newsletter. He's won several more new customers as well -- including one who couldn't justify paying somebody else when Laflamme gave him so much advice for free.
But there are other fruits. Better focus, for one. Companies with successful newsletters attest that the process of producing the newsletter forces them to define their marketing goals and crystallize their message to customers. It also keeps them better informed about their own businesses. "Producing the newsletter keeps me more abreast of my field," says Mitchell. "When I read, I read to write. I really absorb and comprehend a lot more information."
At Best Regards, publishing the newsletter has brought a new discipline to the entire organization, Alan Aegerter reports. "Producing the newsletter forced us to develop new products in a more timely way, so that we'd have some news to report. Product development now has a schedule."
Finally, in some cases, newsletters give CEOs an opportunity to share or renew the passions that got them into business in the first place. For Howell, it was the quest for the ultimate cup of coffee. For Zendeh, the deeply held conviction that people can master mechanical problems. For Kusmerz, the hope that buried in everyone is the seed of a gardener. And that his newsletter will make it grow.
Launching a newsletter needn't bust your marketing budget. If you leave the high gloss and precious designs to the spendthrifts, you can produce a simple epistle for as little as $300 a year.
Keep it to one page. Less space to fill. Less postage to pay. More likely to be read. By limiting it to a single page (you can print on both sides) or two (at the most), you're reducing the amount of research and writing time -- 5 to 10 hours an issue should do it.
Use your everyday stationery. If it bears your logo, that's all you need to start. You can always upgrade to newsletter stock later. When you do, preprinting several thousand uncoated sheets with a nameplate should bring two-color printing and paper costs below 10¢ a page.
Just type it. You don't need new software. You may not even need a computer. Access to a typewriter or a word processor is the only requirement. And you can rent time on a computer at a local printer if you don't own one. Many word-processing programs permit column layouts. Three or four sections, each a paragraph long, with plenty of white space in between, should fill a page.
Photocopy it. Don't typeset or incur the expense of printing. One laser-quality master copy can be reproduced not only clearly but cheaply at a quick-print shop. It'll save the wear and tear on your own copier. And 200 copies should run less than $10.
Use your own mailing list. Make sure the addresses are current and the names correct. Include a request for an address correction on each piece. Rely on your own database of customers, prospects, and leads. Buy directories or borrow them from your local library. Don't shell out big bucks renting lists.
Send it at a bulk rate. With a minimum of 200 pieces, you can buy a bulk permit ($150 the first year, $75 thereafter) to print an indicia directly on each newsletter. You can also use your postal meter or purchase stamps to get a reduced rate of 16.5¢ to 19.8¢ per piece. Mailing locally and presorting by zip code will get you the 16.5¢ rate. Two hundred newsletters would cost $40 at the most to mail.
Marketing with Newsletters, by Elaine Floyd, published by EF Communications, available through BookMasters, in Mansfield, Ohio (800-247-6553); $24.95 plus $3 shipping.
Newsletters from the Desktop, by Roger Parker, published by Ventana Press, in Chapel Hill, N.C. (919-942-0220); $23.95.
Editing Your Newsletter, by Mark Beach, published by Coast to Coast Books, in Portland, Oreg. (503-282-5891); $18.50.
Ninety Ways to Save Money on Newsletters, by Polly Pattison, Pattison Workshops, in Westminster, Calif. (714-894-8143); $6.
Communication Briefings (P.O. Box 587, Glassboro, NJ 08028, 800-888-2084) produces a subscription newsletter about communication and newsletter techniques.
Publish (P.O. Box 55400, Boulder, CO 80322, 800-274-5116) is a magazine about desktop publishing, with frequent articles about newsletters.
Padgett Thompson (P.O. Box 8297, Overland Park, KS 66208, 800-255-4141), a division of the American Management Association, offers newsletter seminars.
Newsletter Clearinghouse (P.O. Box 311, Rhinebeck, NY 12572, 914-876-2081) offers seminars and publications about newsletters.