February 26, 2001– Newsletter #119

Greetings, Weekend Silicon Warriors,

Happy Mardi Gras! If you haven’t yet, make a point of
getting down to New Orleans to be a part of Mardi Gras
sometime in the near future. It’s a great time. Living
here it’s like having two Christmas celebrations a year.
At least that’s the way I feel. I’m new. Many of the
long-time residents get out of town over Mardi Gras. I
understand Disney really fills up with Louisiana families
this time of year.

Did you hear

NAPSTER goes back to court with the RIAA the
morning of March 2nd. In my last newsletter, I stated that
a deal was the only viable method for this to all go away
peacefully. I read that NAPSTER offered a billion (that’s
with a B) dollars to major and independent record
companies in varying amounts of millions over the next
few years. The record companies were not impressed.
Wellthey do make tens of billions per year anyway.
Hmmm

A 20-year-old, Swiss, part time computer consultant was
arrested Thursday under suspicion of hacking into the
computer systems of the World Economic Forum.
He’ll be charged with all the regulars, data theft and unauthorized used of credit cards. My concern is
thishe’s part time? Oh manwhat if the full time
people actually decide to make a statement? 😉

Could it be that Pentium is no longer the king of PC
chips? In a benchmark test the 1.2GHz Athlon chip was
pitted against a 1.5GHz Pentium 4 chip. Obviously the
Pentium has a faster clock speed but in the end, the
Athalon won the contest. According to CNet, games and
business applications worked better sans Pentium. How
about that?

Now onto today’s topic

I got into a discussion with a colleague who asked why I
write my newsletters. My immediate response was that
(at that time) Earthweb asked me to. I thought it would
be a good idea and it seemed like a good way to rant and
start discussions.

But isn’t your site enough?

That really struck me. I began to think about all of the
sites out there that have newsletters. Why do they have
the newsletters? Why do I have newsletters? Isn’t my
site enough?

When Internet.com bought HTML Goodies along with a
slew of other sites, the reports of the sale always made a
point of stating that the site’s newsletters were sold right
along with the sites. I thought that was odd, but I never
really put it together until I began working the topic for
this newsletter.

The concept of freebies on the Web is starting to falter,
but the number of newsletters on the Web is growing. I
think there’s a correlation here.

Nothing on the Web is truly free. There is always
advertising, or subscription, or some other form of
invasion in return for the ability to do, read, or download.
You can get a lot of information from HTML Goodies,
but you must look at banner ads to get it. I think that’s
fair and I make no apology for it. The site is very large
and well visited and that means a large output of money
on the part of Internet.com. I very much dislike the
thought of you paying for the information I provide so I
keep it free. Still the bills need paid and the banner
advertising pays them. It’s the same with any Internet
company that offers a free service.

Somewhere the free service provider is making money.
Usually the venue for creating profit is advertising.
Hotmail offers free email, but in order to come and get
that free email, you give up your name and ad space.
You’re forced to look at a bunch of little banners.

I offer a newsletter. In fact I offer two, but let’s stick
with this one specifically. You got this newsletter for
free, but you’ll also note there is advertising on this
newsletter. Internet.com sells space. It costs money to
put this newsletter out. Those who work for the company
need to be paid. The ads provide the cash to make those
payments. Again, I think that’s fair.

OK, so what? A site offers banner ads in return for free
services. A newsletter offers itself for free in return for
services or information. What’s the difference?

The audience. That’s the difference. In fact, to an
advertiser it’s all the difference in the world.

A web site might get one million page views per week.
HTML Goodies gets that many. In fact, it gets many
more. Those page views are made by a wide range of
users. The audience may be large, but it isn’t always
quite cohesive. It isn’t always overly homogeneous.
Yes, the visitors are all interested in the topic, but that
interest is not equal. Some are slightly interested in the
topic. Others will live for it. Ages will vary greatly.

The newsletter audience is different. It is a more specific,
more cohesive, and more active audience. How do I
know they’re active? It’s because they signed up for a
specific newsletter. They acted. The audience for this
newsletter shook themselves out of the site visitors.

As any advertisement executives will tell you, a targeted,
homogeneous audience will always demand a higher
price per person than will a large randomly drawn
audience.

The ad exec will also tell you that an active audience will
always demand a higher price for advertising than will a
passive audience.

So let’s look at the two once again. The site’s audience,
although large, might not be homogeneous. There’s no
guarantee that any of the users will be active. They may
never click on a banner ad. Rates for banners ads rely
heavily on audience make up and activity. I’m happy to
say that the HTML Goodies audience is a very desirable,
active audience. (I love you people!)

On the other hand, a newsletter audience is fully active. I
know that because they’ve already taken action. They
signed up for the newsletter. The audience is
homogeneous in that they chose the newsletter topic. The
people that make up the audience for a newsletter are
people that have set themselves apart as an active,
homogeneous audience under a specific topic area.

Why do you think so many sites offer so many different
newsletters? Isn’t one newsletter per site enough? Not in
terms of breaking up the audience. Multiple newsgroup
choices allow the audience to further subdivide itself into
groups. Yes, love of topic is a big part of it, but from the
advertising standpoint, the newsletter audiences breaking
themselves down into smaller, targeted audiences, is a
great thing.

There’s a reason why the Big Band radio station in your
town can stay alive while it sits 13th in the ratings. It
might not possess a large audience, but the audience it
possesses is loyal, targeted, and active. That’s very
intriguing to an advertiser. That station’s audience is
small enough that it can be catalogued. It can be
quantified. It can be delivered to an advertiser who sells
a product built specifically for the audience that listens.
Rather than spending big bucks to hit the largest number
of people, an advertiser can hit less people, but know that
the people he or she is hitting are interested and active.

Sowhich is more important?

Is it the site or is it the newsletter? Is it both?

Which will it be in two years?

>>>>>>>>>>>>>>>>>>>>>

That’s that. I thank you again for taking the time out of
your day to read what I write. It makes the time I spend writing it much more enjoyable.

Joe Burns, Ph.D.

And Remember: I am writing this on the day that Hannibal comes to theatres. I’ll be seeing the 2:20 show
this afternoon. Did you know that one fictional character
has been portrayed more times than any other? It’s not
Hannibalit’s Sherlock Holmes.