So you have an idea for a new high priced newsletter or magazine. You can line up your writers and editors, rent some facilities and then try to line up the financing before you go totally broke. Then you spend months creating the first issue. All this time you have no idea if anyone will really buy it. Well that is certainly one way to enter the publishing business.
However, a smarter way may be this. You develop the concept and the ad copy. Then you invest some money in promoting the newsletter or magazine with the objective of soliciting subscriptions. With the money from the subscriptions in hand you then begin to actually produce the magazine. Further, with subscriptions in hand you can raise capital much easier, because one, you have some cash in hand, and two, you have proven demand.
What’s cool about this method is that you pre-identify the market, then you produce the product or service. Oh, yes, if your little promotional effort shows there is no demand, then you just return the money to the people who did subscribe and say that the product was delayed or canceled.
I have been using variation of this example in class for years and can be apply to many situations not just publishing. Now there seems to be an updated version of this pre-identification technique for the Net age.
In an article in one of my favorite magazines Business 2.0 they give some examples, and the following advice.
Line up your customers first, then create a business around them.
1. Identify an overlooked need for services kicked up by, for instance, relatively obscure regulatory changes.
2. Construct a first-rate website with a generic domain name that will draw in prospective customers.
3. With clients in hand, create the business, providing the service yourself or subcontracting to established players.
Hmmm, given that this basically eliminates much of your promotion costs, you can spend most of your time trying to identify potential niches and then just matching the “clients” to your sub-contractors or partners.
Ah, so much value to create, so little time.