This Year's Model

An old-line publisher morphs into an on-line star, discovering brand-new revenue sources in the process.

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The Fourth Annual Inc Web Awards: Transformations

Company: Edmunds.com, in Santa Monica, Calif.
URL: www.edmunds.com
What we liked: A slow-growing 30-year-old publisher embraces the Web's real-time advantage and becomes a leading site for automotive information

The folks at Edmunds.com admit that their early Internet goals were, to put it mildly, off course.

In the mid 1990s, Edmund Publications viewed the Internet as just another place to promote its respected auto-buying guides. Today the Web drives the entire business. Meanwhile, its print line appears headed the way of the minivan: still available, still reliable, but no longer a consumer favorite or a company priority. "The books are a nice part of our heritage," says company president Jeremy P. Anwyl. "But they're not a major focus." In fact, books now account for less than 1% of the company's revenues.

The 1999 name change -- from Edmund Publications Corp. to Edmunds.com -- says it all. Like the venerable guidebooks, one for used cars and one for new cars, the Edmunds Web site offers a wealth of independent ratings, reviews, and pricing data for every make and model. But the two books -- which average 450 pages -- are published annually; Edmunds.com, with 800,000 pages, gets daily updates. The site also brims with interactive features: a tool for comparing up to eight vehicles side by side; a 500,000-member consumer forum; a searchable database of dealers; and calculators for estimating actual sale prices, ownership costs, and loan rates.

And the information on Edmunds.com is free. That's because the $50-million company makes its money primarily through ads placed by manufacturers and parts dealers, as well as through car-stereo retailers, insurance companies, commercial lenders, and other auto-related businesses. The books, by contrast, bring in only their cover price.

Founded in New York in 1966, Edmund Publications chugged along for 22 years, selling its guides to consumers, libraries, and credit unions. It was consistently profitable but never grew much. In 1988 the then-three-person company was sold to Peter Steinlauf. Shortly afterward the changes began.

Steinlauf kept the company name but moved it to car-happy California to explore new publishing options. First up was a CD-ROM, but the product proved short-lived. Then, in 1994, Steinlauf tried offering car- pricing data on demand through a pre-Web, text-only "gopher" site called the Electronic Newsstand. The service included invoice prices, which showed what dealers pay manufacturers for specific cars. At the time, that was tough-to-find information that could be a powerful negotiating lever. As word of the free listings spread by E-mail, car-pricing requests so overwhelmed the Electronic Newsstand that its owners told Edmund Publications to hit the road.

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