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Oct 02, 2002
Case Study

Fierce Markets: The Story of a Profitable Ad-Based Email Newsletter Publisher

SUMMARY: Launch an ad-based publication in mid-2001? Was Jeff Giesea out of his
mind? Not out of his mind, but onto something. By focusing on high-quality
editorial, he was able to attract valuable readers, and where the readers
are the advertisers will be.

Now his first publication, FierceWireless is sold out two months
in advance. Read about Giesea's "virtuous circle" of content publishing,
and what he learned along the way, on the path to profitability.

Between 2000, when Jeff Giesea began planning to
publish an ad-supported newsletter, and 2001, when Fierce Markets
finally launched, the ad industry had taken a big hit.

While most publishers begin with an audience or an area of
expertise in mind, Giesea began with a concept: To create highly
focused content that was generally only available in a paid
newsletter, but offer it for free. He believed that good readers
would follow good content, and good advertisers would follow good

All he needed was a market to test his concept, the fast-growing
wireless industry provided that.

Still, Giesea knew that a market and a concept were not enough
to keep other publishers in the black through bleak advertising
times. How was he going to build his ad-based publishing company
when CPM was falling?


In April, 2001 Giesea launched his first
newsletter, FierceWireless. Having secured financing from a fund
he had helped start when he got out of college in '97, he hired an

Giesea decided not to hire a salesperson first, because he
knew that he needed to produce high quality content to attract
subscribers before he could sell advertising.

"Initially I used b2bWorks to sell ads, and they were great, but
we just weren't making much money," Giesea said. "I felt that we
really needed to bring the sales in house so that we could add as
much value as possible. And by hiring an editor I could focus on
providing that level of service to advertisers."

In August, 2001, Fierce Markets expanded into three new
content areas, Broadband, Biotech, and Enterprise (CRM), using
the same process Giesea had developed for FierceWireless. He
calls this process his "virtuous circle:"

1. Develop excellent content

2. Attract high-quality readers

3. Attract high-quality advertisers

When one of his Wireless advertisers, mentioned to Giesea
that they loved their results in FierceWireless, and wanted to
find the same level of readers in the biotech field, Giesea did
some investigating, and launched FierceBiotech.

The questions that Giesea asked before he entered a
new market were:

=> Can we deliver value to advertisers? Is there demand
from advertisers to reach this audience?

=> Can we build circulation? Will there be a buzz

=> Do we have the editorial resources to do it?

Once Fierce launched its new products, and had the editorial in
place, Geisea focused on building opt-ins and delivering results
to advertisers.

==> Attract High-Quality Readers

Giesea employed a couple of tactics to build their opt-in
base for each publication.

* Fierce partnered with conference organizers in each content
area. Geisea emphasized that they had several conference
organizers that were active in more than one content area.

* Fierce also concentrated heavily on utilizing Overture and
Google AdWords campaigns to drive opt-ins. He tested
multiple keywords and phrases, and tracked results for each
and every one.

==> Attract High-Quality Advertisers

In December, 2001 Geisea hired his first ad salesperson.
He made the move so that he could free up his own time to work on
business development, and to make sure that advertisers' needs
were being adequately met.

By working with advertisers, and soliciting their feedback, Jeff
and his team developed an easy-to-understand advertising program that
offered advertisers three options:

1. Newsletter sponsorships

2. Email blasts

3. Event/marketplace listings

Fierce then offered different bundles of packages, labeled
Platinum, Gold, Silver, and Bronze that combine each option in a
variety of ways and at different price points. The idea was to
provide their advertisers with flexibility.

To use Fierce Biotech as an example, here is what the
rates look like:

* Newsletter weekly sponsorship- $2,500 (5 issues total)

* Email Blast- $4,000 per blast

* Event/marketplace listing- $600 per month

The packages look like this:

* Platinum package, includes 3 weekly sponsorships, 3 email
blasts, 1 monthly marketplace - $17,000

* Gold package, includes 2 weekly sponsorships, 2 email
blasts, 1 monthly marketplace - $12,000

* Silver package, includes 1 weekly sponsorship, 1 email
blast - $5,900

* Bronze package, includes 1 email blast, 1 monthly
marketplace - $4,400

Purchasing a package, rather than components saved the
advertiser some money.

When asked how Fierce determined it's ad rates, Geisea said
that although they do not use CPM in their pricing, they do
benchmark against relevant publications and lists. For
instance, when they priced their email blasts, they looked
at the CPM for commercial opt-in lists in their industry.

Once Geisea had a general idea of price points, he tested
various prices and combinations until they were able to sell their


In September, 2001, Fierce Markets was in the black
and has been profitable since, despite the dismal
advertising environment over the past 24 months.

Geisea considers this a vindication of his "virtuous
circle" idea. They have succeeded in winning readers
because they focus on delivering quality content in high
growth niches.

==> Attract High-Quality Readers

In the 12+ months that most of the newsletters have been in
existence they've grown their opt-in numbers to:

* FierceBiotech-20,000

* FierceBroadband-10,000

* FierceWireless-40,000

* FierceEnterprise (was FierceCRM)-20,000

Each publication's circulation grows on average 1%
a month, and they have yet to reach a point of stagnant

==> Attract High-Quality Advertisers

According to Jeff, "When advertisers question whether our
publications are a good fit for them, we encourage them to
do a test campaign. Sometimes it's not a good fit, and we
encourage them NOT to advertise with us. About 80% of the
time, however, it is a good fit, and the advertiser returns
to buy a larger package. Test packages have been a great
way to build relationships with our advertisers."

"If an advertiser refuses to take the risk of purchasing
a small test ad, then it's likely not a good fit, and it
wouldn't pay off for either party. Thus we never do CPA

"I think most of our success is due to keeping our business
very simple. And I know that our advertising is successful
because of how we package it. It is very easy to
understand and it gives our advertisers a lot of

Geisea declined to share specific numbers for total ad
inventory sold across all pubs, but he did say that their
flagship publication, FierceWireless is sold out two months
in advance. He also reports that they get an 80% renewal or
return rate for all advertisers.

==> Develop Excellent Content

An interesting trend that Jeff's team has identified is
that in industries where their publication is clearly
considered the best, they have great success selling ads.
On the other hand, if their publication is not clearly in
front of the field they have trouble selling ads.

Based on these observations Jeff feels that it is
worthwhile to focus on developing quality content, and not
on launching a large number of newsletters.

==> Revenue Mix

The majority of Fierce's revenue, about 54%, comes from
advertisers' buying email blasts.

Fierce is now generating about 15% of its revenue from a
completely unexpected source: site licenses. Although they
do not actively promote site licenses, they have had several
large corporations, including ATT Wireless and HP, approach
them and request site licenses for their Intranets.

==> Geisea's Tips for Other Publishers

* Advertising growth is explosive. Once you garner
that first big-name advertiser, their competitors and
cohorts soon follow. It legitimizes your
publication, and has a me-too effect.

* Opt-in growth is linear. No matter what they do the
growth of Fierce's opt-in lists tend to follow a
steady growth trend.

* Constantly re-evaluate your offers. In May '02
Fierce raised rates for FierceWireless because of the
great demand for ad slots. They did not see a
reduction in ad buys. On the other hand,
FierceBroadband was selling slowly so they reduced
rates and took it from a daily to a weekly. That did
the trick.

* Monitor editorial spending versus revenue on a per-
pub basis. This was one of the reasons for taking
FierceBroadband from daily to weekly.

* Outsource as much of the technology as possible.
"The technology has gotten much more sophisticated
and reliable. My only recommendation is to pick your
email list distribution service carefully - and trust


Fierce Markets

FierceBroadband Rate Sheet
See Also:

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