Newsletters, Online

views updated

NEWSLETTERS, ONLINE

Online newsletters, also known as electronic newsletters, became popular during the late 1990s. As the number of World Wide Web surfers using the Internet for gathering information and making purchases increased, many businesses began using online newsletters to promote company Web sites, products, and services; to provide information; and as an additional source of revenue through advertising.

According to a 2000 BusinessWeek Online article, online newsletters can accomplish the same things as traditional print counterparts. "They remind customers you're there, spark repeat business, and help attract new clients." The article also points out some benefits of producing an online newsletter versus a traditional print version. As well as being environmentally friendly, online newsletters save the publisher time and cut costs by reducing postage, paper, and other mailing supplies costs.

Along with being less expensive and easier to produce, online newsletters can also reach a much larger customer base. While many online newsletters are available on a publisher's Web site, the most popular method of delivery for many newsletters is through email. Whether free or fee-based, Web surfers can sign up to receive newsletters that are sent directly to their email accounts. For example, CNET.com, an informative Web site catering to the computer and technology industry, has over 40 free online newsletters such as the Enterprise Weekly Newsletter and the News.com Daily Dispatch . The Motley Fool, known for its humorous investment advice, also offers its members free newsletters via email, including FoolWatch Weekly and Investing Basics . Both newsletters are sent to the subscriber's e-mail address on a weekly basis and contain investing information and news. In June of 2001, Japan's Prime Minister, Junichiro Koizumi, launched an online newsletter entitled Lion Heart, which covered political and technological issues. In its first week, over one million people subscribed to it, and just two weeks later, the newsletter had secured over 1.82 million readers.

While many newsletters exist solely as an information source and do not utilize advertising, many others are published as a source of revenue. A 2001 study done by Opt-in News reported that one out of three online newsletter publishers used the newsletter to generate advertising revenue. Twenty-eight percent of those publishers used outside firms to garner advertising sales. Another study done by Clientize, a Florida-based market research firm, found that 207 of the top 500 magazines had free online newsletters. While most magazine publishers polled thought the online newsletter was an excellent tool for generating traffic on their Web sites, 21 percent rated them as an excellent source of additional revenue.

With an increasing number of online newsletters in circulation and online traffic increasing, businesses began viewing the electronic medium as an attractive place to advertise. In fact, advertising in online newsletters is often more effective than placing a banner ad on a Web site. According to Forrester Research, advertisements in email newsletters had an average response rate of 18 percent in 2000, versus a banner ad click through rate—the number of times someone clicks on an ad—of less than one percent.

As advertising in online newsletters grows more commonplace, many marketing firms began touting services that helped businesses advertise in electronic media. In 2001, interactive media firm Engage Inc. offered a business-to-business (B2B) e-mail newsletter sponsorship program that allowed companies to place ads in B2B newsletters. 24/7 Media Inc., another interactive marketing firm, offered similar programs that were targeted towards newsletter advertising.

With Internet use predicted to continue rising, the number of online newsletters will, no doubt, continue to increase along with it. Forrester predicts that by 2002, businesses will send 250 billion e-mail newsletters, and by 2004, most firms will have tripled their e-mail budgets. Michele Slack, an advertising executive with Jupiter Research, stated in a March 2000 CNET News article, "online players either have e-mail newsletters or are going to have them, and it's partially driven by competition. Newsletters are a way to lock in your consumers and remind them on a periodic basis of the value you provide."