Visions of a world of customers waiting behind the keyboard tempt many small businesses to try on-line marketing. But logging on to send colorful direct-mail messages and advertising copy won't impress anybody. Your prospects are likely to reply with "flaming" hate mail and then tell all their friends how rude your company is.
Russian Information Services (RIS), a publisher and distributor of books about traveling in Russia, has figured out the right approach. The $1-million company began using CompuServe, and in six months earned $2,000 in sales directly -- an average sale is two or three books at around $20 apiece -- by working leads on the on-line service's Travel and International Trade forums. And it added more than 100 highly qualified names to its 48,000-name mailing list. RIS's CompuServe costs are tiny -- less than 1% of its marketing budget.
On-line forums are directories of postings that everyone can read. As people respond to one another's postings, they create threads, or series of messages on certain topics. For example, one posting (think of it as a memo) may ask about renting cars in Italy. Answers may recommend rental services or scenic routes.
RIS founder Paul Richardson saw potential in those threads last year. The company had been using CompuServe as a backup E-mail system between its Montpelier, Vt., home office and its Moscow branch office. "At first I was interested in the business forums," Richardson says. But he learned he could pinpoint his market more successfully in CompuServe's Travel Forum -- and target customers on-line much more successfully than he could with direct mail.
Early on, Richardson made the mistake of posting an on-line catalog listing his books and their prices. But the Travel Forum's system operator, or sysop, pulled the message before anyone saw it. It was too much like an ad, the sysop said. Richardson had to remove the order form and list the publishers so people could contact them directly. His recommendation? "It's better to ask first, and the sysop will tell you what's allowed." On the Internet or America Online, lists of frequently asked questions give guidelines about what's allowed and what's likely to get flamed.
RIS learned that in general, selling on-line is like working a cocktail party. You must suppress the urge to whip every conversation into a sales pitch. Instead, answer questions, chat people up, and hand out business cards if you must, but don't talk shop until someone else brings it up.
"People pay to be on-line," Richardson says. "They want to feel that they're getting information, not being solicited." Richardson focuses primarily on answering questions, slipping in an ad only if it fits the situation. "If there's value in your response, then recommending a useful resource is an easy transition."
That approach complements rather than replaces Richardson's direct-mail efforts. With direct mail, he's trying to get his customers just to open the envelope. With E-mail postings, he already knows his messages will get read. They build product awareness with an audience he wouldn't reach with direct mail.
Richardson checks the forums every day, spending about 15 minutes reading and replying to messages. His monthly bill runs about $100; two-thirds of that is the cost of daily E-mail between Montpelier and Moscow, so only a small fraction of the bill is a marketing expense.
Like many small-business owners, Richardson prefers mainstream on-line services to the Internet. His experience with the Net: "It's overrated. You've got to be pretty computer literate to navigate it." Although there are really no rules against marketing on the Internet, companies will find it will get even harsher reactions from users there.
This article originally appeared in Inc magazine in March 1995 and was written by Phaedra Hise.