Dec 20, 2000
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By Claudia Levine
MarketingSherpa NY Correspondent
We were fortunate enough recently to catch up with Mike Shatzkin, founder and CEO of The Idea Logical Company. His firm develops content for sports junkies.
The big news, though, is how he makes money off the content he develops. Shatzkin attributes his positive cash flow to three guiding principles. First of all, he constantly looks to make his product better for end users. (Sounds obvious, but how many sites have you seen that are configured to benefit their own marketers … or worse, their technology?)
Secondly, Shatzkin leverages partnering to the hilt. He outsources the parts of the business that get in the way of his main focus – developing and distributing his content. He chose to co-brand with a prestigious partner who distributes his content on their site and handles ad sales.
To build his vast store of information, he’s licensed related content from others, and negotiated for rights by offering publishers links to online bookstores. He’ll link extensively to competitors to establish his content as the comprehensive, definitive authority. Shatzkin wants every word, picture, sound, or moving image on his specialty – baseball -- in his library. Period. This of course will produce more loyalty … more clicks … and more ad revenue.
Finally – wholly related to partnering – he’s not afraid to morph his business model. His current income is derived from ad sales and -- to a much lesser degree -- book sales. But Shatzkin firmly believes that repurposing the content for multiple sites opens up more ad sales (more book sales too, for that matter). And he anticipates that syndication will produce significantly more ad sales going forward than were gained through exclusive distribution. Of course, the two partners – Shatzkin and Sportsline – now cheerfully share all that lovely syndication revenue.
Here’s an overview of Shatzkin’s business. He wrote a definitive baseball encyclopedia in 1990 called The Ballplayers, now out of print. It contained over 6,000 proper names, which of course lend themselves beautifully to hyperlinks. Who had the time, inclination or resources? Enter Sportsline USA, CBS’s sports web portal.
While Sportsline was developing the database of hyperlinks, Mike -- spurred on by Sportsline’s original pay-per-view model -- thought up a site to provide useful information to fans who participate in “rotisserie” leagues. These are the folks who compete with their friends at putting together fantasy teams based on real stats.
Initially, Sportsline garnered pay-per-view advertising for this site and split the revenue with Mike. Revenue has grown substantially each year, and Sportsline shifted the deal to one where Mike now gets a fee outright for his content. Shatzkin also started up a similar site for football.
He’s now working on baseballLibrary.com – an all-inclusive compilation of baseball information, which he’s developing by partnering aggressively, licensing content from others, and aggregating material. As Shatzkin puts it, “Increasingly, if you want information on baseball history you have to come through us.
Or as Mel Brooks once said, “It’s good to be the king.”
To reach Shatzkin directly (yes, he does occasionally consult for other "members of the publishing value chain") call 212.758.5670 or email: firstname.lastname@example.org.
Note: The author, Ms. Levine, a former Marketing Director at Aspen Publishers Inc., Institutional Investor, and Institute of Management & Administration (IOMA) has founded her own consultancy for publishers seeking advice in marketing content. To contact her, email email@example.com