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Jun 12, 2003
Case Study

PC World Tests Selling PDFs and CD ROMs Online: What They Learned...

SUMMARY: If there is one lesson to be learned from this Case Study, it is that sometimes you have to keep projects simple to get them off the ground at all. PC World's Bruce McCurdy deliberately avoided fancy tests, tracking heaps of metrics, and investing in an ecommerce backend, when he decided to test selling PDFs and CD ROMs for the first time.
The point was to get the answer to a single question: Will people buy these items at all? Here is what he discovered:
CHALLENGE

The first thing any visitor notices at the PC World
site is that there is a heck of a lot of content at absolutely no
cost. It is like an Olympic-sized pool of information, more than
enough to slake the thirst of most PC enthusiasts.

Which is a great advantage for an ad-based site to have. They've
got lots of passionate-audience pageviews to sell.

However, last summer Online Product Development Manager Bruce
McCurdy began to wonder if he could supplement ad revenues by
selling ancillary products, such as repackaged article
compilations, to visitors.

"There was some skepticism at first," he notes. "But we don't
want to be simply ad-driven."

Plus, McCurdy figured if he could prove info products could be
sold to PC World's visitors, then he could ramp up the project
and extend offers through partners across the Web including
Yahoo, AOL and others.

First he had to convince the management to let him have
enough money to create a few products and run a marketing test.

"I really sort of had to battle to get a couple of thousand
dollars out of the budget. People didn't believe it would be
viable. I said, 'I guarantee I'll break even.' They said,
'That's a couple of hundred sales.' I said, 'I can do it.'"

CAMPAIGN

The PC World print magazine staff had been
experimenting with offering a total of 10 PDFs as an inducement
to subscribe to the magazine (subscriptions cost about $20).
Subscribers also got four CD ROMs containing shareware software
programs polybagged into issues per year.

McCurdy thought, why not steal these two ideas and test selling
PDFs and CD ROMs?

If your brand is already basically giving away so much
value, how can you create ancillary items that are so much more
wonderful that they are worth paying for? "That was the real
kicker," notes McCurdy.

First he researched which topics got the most traffic online, and
which would be both evergreen enough to continue as products for
a long time, but also require updates so any pirated copies would
be outdated after six months or so. (Thus pirates would be
enticed to buy a fresh one.)

Then, with help from editorial and production, McCurdy created
one CD ROM and three PDFs to test selling. The titles were
cleverly copywritten to indicate that this was even more valuable
content than the no-cost stuff on the site. They were:

"The Ultimate PC World Hardware Guide" CD ROM $9.95
"PC World's Super Guide to Keeping Your Privacy" PDF $5
"PC World's Super Guide to Buying Hardware" PDF $5
"PC World's Super Guide to Troubleshooting Your PC" PDF $5

In order to reduce piracy, McCurdy password protected the PDFs,
and he made sure they were all over five megs in size.

"It's a quick and dirty digital rights tactic. Most email
packages cap messages at five megs, so if you want to pass a PDF
to a friend it must be under that."

The production values on the PDFs were high in order to increase
value and potential resales in the future, including:

o Using screen-friendly fonts that scale well, including
Times New Roman and Verdana
o The ability to view either a single page, or a two-page
spread from a PC (single pages help with printing).
o High-resolution images that viewers could zoom in and
enlarge by 400-scale before they lost definition.
o All hotlinks through the body of the document are also
repeated again in a hotlink index at the end.

McCurdy says that hotlink index is the usability tactic he is
proudest of. "There are different types of readers. Some people
can read 3-4 books at the same time, remember where they left off
in each one, and come back again. Some people have to get
through an entire book before they pick up the next one to read, now they are ready for the next step."

PC World's production department created the original documents
in Quark, which was then translated to Adobe Acrobat version 5.
McCurdy notes you need to triple check all hotlinks after a
conversion process, "We had problems with line breaks, so I came
in late one night and checked each link in all three Guides
painstakingly."

Because this was a low-budget test launch, McCurdy did not want to
invest in building an entire ecommerce back-end. Instead he worked
deals with two different companies to help him sell and fulfill
the products:

1. A PDF ecommerce partner

McCurdy asked his old friend, online publisher Chris Pirillo if
he could sell the PDFs in his Lockergnome Tutorials store.
Pirillo handled payment processing and PDF fulfillment, and also
sold a few copies of the PDFs to his own list on the side.

(Note: It is kind of neat that a big publisher turned to a small
competing publisher for help. Shows that you should never
overlook useful partnerships due to fear or ego.)

2. CD ROM-fulfillment partner

McCurdy signed a burn-and-ship on demand deal with Gigex, who
also handled the ecommerce end for the CD ROM sales. It cost him
an extra $1-$1.50 per CD ROM than paying to burn a whole bunch at
once would have, but saved him from the fear of investing in
inventory that might not move.

In both cases, due to strong privacy policies PC World did not get
the names or emails of the actual buyers from these partners.
However, McCurdy says that drawback was worth it to be able to
launch a new product test so rapidly and painlessly.

Next, in late November McCurdy began his marketing campaigns for
the new products (links to samples of creative and landing pages
below).

The object was to test whether the products would fly at all, so
McCurdy decided against intensive campaign metrics tracking or
investing in outside media. He just wanted to get an offer in
front of perhaps 5% of the total PC World online audience and see
if they bit.

Later if the test was successful, he could invest further in
tweaking creative (as well as building an internal ecommerce
back-end).

He used three specific tactics to get the word out:

1. An email blast to a permission list PC World had built from
site visitors who asked to learn about special offers.

2. Small text ads in PC World site newsletters for the month
of December.
3. Text links on a small, permanent box on the far right of
many secondary pages in the PC World site entitled,
"PCWorld.com Picks & Promotions".



RESULTS

McCurdy hoped to sell a few hundred of each product but he ended up selling thousands. The CD ROM sold around 5,000 copies and the PDFs sold "not quite tens of thousands but pretty close."

Remember, this was for products that were promoted only for a short time to a limited number of the PC World audience. McCurdy now has high hopes for additional products in the future, especially as he lines up in additional distribution partners.

About 1% of consumers who were sent an email blast opened,
clicked and purchased a product. The blasts were naturally the
highest source of orders, being so much higher in profile than
the other marketing efforts.

McCurdy notes, "I think it was smart of us to do the bare
minimum. Now we know these will sell, we're making the decision
to move forward with the program."

Here is a link to marketing creative used in McCurdy's campaigns
to sell PDFs and CD ROMs:
http://www.marketingsherpa.com/pc/ad.html


Sales page for PDFs at Lockergnome:
http://tutorials.lockergnome.com/guides/000037.html


http://www.pcworld.com

http://www.gigex.com
See Also:

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