Suppose you could sell a 248-page perfect-bound paperback book that cost you about $1 to print for $12.95 a copy plus $4 handling. Not so bad, right?

Now suppose you could sell a CD-ROM with the same text plus much more–a CD that cost you about a dime to burn–for $20,000.Better?

Having gotten your attention, I’ll be honest. Although we have one $20,000 customer, it’s a federal agency. That’s our market; you may not be able to replicate the experience with your market. But keep reading anyhow. We’ve turned a successful print product into two even more successful electronic products, and it’s possible that you can learn from what we’ve learned and boost your sales too.

We publish the Federal Personnel Guide, which summarizes and explains the most important rules and regulations that govern the careers and retirement of civilian employees of the U.S. federal government and U.S. Postal Service. It is, in effect, an “employee handbook” for Uncle Sam’s civilian workforce. (Odd as it may seem, the federal government does not publish its own employee handbook, and never has, although individual agencies have tried to do so from time to time. The private sector has not hesitated to fill this void–we have three direct competitors.)

Our Guide has been published annually since 1979. When we acquired it from another company in 1988, the cover price was $3. Over the years, we’ve built annual book sales from some 35,000 copies to a peak of 55,000 copies and moved the cover price to the aforementioned $12.95 (plus $4 handling).

Most of our buyers, however, are federal/postal agencies that buy in bulk at deep discounts, typically ordering 10 copies and paying $8.95 a copy or less. We also sell to individual federal/postal employees, who usually buy single copies for $16.95 with their own money.

When the Customer Wanted a File

In the early ’90s, agency customers started murmuring about wanting the Guide on a floppy. This was easy to ignore. Why would anyone want to get eyestrain starting at a green screen (remember green screens?), when they could buy our solid, tangible, desktop objet–crafted lovingly from ink, glue, and paper–for a mere $6.95 or so?

That’s where my mind was when the Environmental Protection Agency called one day and asked whether we’d license the Guide to them as a file.

Well. A customer. Time to create a product. Who cares if it makes sense?

Meetings followed with EPA officials, culminating in the development of the Guide as a PDF file. An EPA contractor from the private sector actually did this development, and we didn’t pay a penny. The contractor suggested the PDF format, and I, a perfect software idiot at the time, said, “Sure.” It turned out to be a very good choice for us, both then and now.

Interestingly, after developing the product at its expense, EPA chose not to buy it. The reason probably was price, although I didn’t know it at the time. But I had my product. So I started to sell it, and to climb a six-year learning curve.

U.S. Marshals to the Rescue

Almost immediately, I made a $10,000 sale of the new electronic version of the Guide to the U.S. Marshals Service that justified the existence of this new product, which, after all, had cost next to nothing to develop. We sent them a non—copy-protected CD that they could copy to their LAN (Local Area Network) to make the material available agency-wide.

Then I did some research on pricing–which resulted in a price list waaay too high for my market (a fact it took me years to discover)–and started prospecting among my biggest agency book buyers for the new product, now known as The Federal Personnel Guide on LAN. What are you offering? they asked. The Federal Personnel Guide on a disk as a PDF file, I said. Oh, really? they yawned.

Nevertheless, I increased LAN sales to around $15,000 a year–to the handful of federal agencies that didn’t balk at those original too-high prices. But clearly this new product wasn’t lighting many sparks.

Eureka!

Then one day I was sitting in a meeting, only half-listening to the speaker, when the light bulb went on over my head.

Sometimes it takes a while–sometimes years–for the bits and pieces that you know to coalesce into a great idea.

One bit I knew was that my readers wanted more text references to the CFR–the Code of Federal Regulations, the body of rules that underlies every word in the Federal Personnel Guide.

Another was that CD-ROMs, then relatively new, could hold a lot more information than floppy disks.

And then there was the Internet, also new (can you believe the Internet was ever new?), with its hyperlinking transforming us into mouse-clicking, site-hopping jumping beans.

CFR. CD-ROM. Hyperlink. Eureka!

Got to hyperlink the CFR references in our text to the CFR itself!

Why stop there? Got to hyperlink all the Web and e-mail addresses in the Guide! ‘Net users are clicking, and Guide users ought to be able to also.

And hey . . . what about all those text references to standard forms everyone needs to fill out? And source documents, handbooks, reference materials, pamphlets? They’re all government documents in the public domain! They’re all available online! Why not hyperlink all of them into our text too?

Today, the Guide is available three ways: as a printed book, on CD-ROM for individual use, and as the Guide on LAN, a site license for federal/postal agencies, “site license” being a clumsy name for what is, in effect, a right to use certain electronic content at a specific site, or, if you prefer, a bulk electronic subscription. Our site license agreement–which every licensee must sign–sets forth the number of users licensed for and the duration of the license, among other terms.

Electronic Enrichments Options

The electronic editions are hugely enhanced from the print publication that spawned them, with about 100 MB of reference materials hyperlinked into the text. One click takes you to the hyperlinked reference item; one more click and you’re back in the Guide.

What about your publication? Even if it’s not a reference work like the Guide, you too can enrich your texts electronically. For fiction and children’s books, think pictures, filmstrips, tunes. For nonfiction, think reference materials. For anyone, it’s easy to hot-link Web and e-mail addresses. (It’s relatively simple to embed a link in a PDF.)

The year we started offering this enhanced product was the year our electronic sales tripled. But I’ve concluded that, although the enhancements were a big reason, they weren’t the only reason.

What Else Matters

Sales and marketing factors may be at least as important:

Price. My original price sheet was way out of line. I started experimenting and discovered prospective buyers responded to discounts–that is, offering a “special deal” made them quicker to buy. I put “deal” in quote marks because the deals aren’t special at all any more; they are standard. I still use that old price sheet, but now it’s a straw man–”Here’s the regular price, but for you, I’ll knock off 20 percent.”

Prospects. After you run out of big existing customers, how do you develop new ones? Most of our marketing is via direct mail and, increasingly, via our Web site. All our mail now includes a buckslip with a succinct sales pitch for the Guide on CD-ROM on one side, and for the Guide on LAN on the other side. Also, I discovered the power of trade shows. At a show, I can demonstrate the Guide on LAN; when prospects see its powerful features, they are half sold.

Sales techniques. Before I produced the Guide on LAN, I had little direct sales experience. But this product is strictly a hand sell; do not get involved with site licensing unless you are willing to spend a good portion of time in actual sales. Luckily for me, my market doesn’t want a hard sell. Once they understand what the product is and what it can do for them, and we’ve agreed on a price, it becomes a matter of finding the funds. The most important sales technique is persistence: Keep calling back. Nine out of ten calls, I just leave my name and number. I move the Outlook reminder (see below) forward a day or two and call again.

Sales tools. The most valuable sales tool I’ve discovered is a contact manager, to keep track of who I’ve called, what we’ve said, and when to call back. I use Microsoft Outlook because it integrates e-mail, an address book, a calendar, and note-taking capability, and because it was on my computer already; but you might prefer a program specifically designed as a contact manager, such as ACT! Before I started using Outlook, I floundered in piles of sticky notes and lost more contacts than I followed up; after I started using Outlook, sales rose almost immediately.

Message. I said my audience doesn’t go for a hard sell; that’s true, but I still have to have a sales pitch. At trade shows, you have 30 to 60 seconds to make your pitch, so I had to pare mine down. You should too, whether or not you do shows. Base your sales pitch on an understanding of your customers–who they are, what they need, what they want, what else is available, and, not unimportantly, what funds they have access to. Make sure your sales pitch anticipates objections and includes sensible responses to them.

A good product, an understanding of my market, and an effective marketing and selling strategy together led to tripling our electronic sales last year. This year, the site license renewal rate is 91.35 percent, and total site license sales are up again–by another 50 percent.

Frank S. Joseph is publisher of Key Communications Group Inc. in Chevy Chase, MD. As “Mister DMâ
,” he is an award-winning direct marketing copywriter and publishing consultant who helps niche publishers build sales and acquire new customers. He was formerly an editor with The Washington Post, The Associated Press, The National Journal, and numerous subscription newsletters in business-to-business fields, including health policy, energy marketing, and banking institutions. To reach him, use 800/705-5353, 301/656-0450, or Mr.DM@Verizon.net.

But Frank . . .

. . . what if customers print out your book from the CD?

Let ’em. We decided not to restrict printing-out. We figured, if someone wants the whole 248 pages, they’re better off buying a book from us for $16.95 than turning on the photocopier.

. . . what if they copy the entire CD and post it on a pirate Web site?

Yikes–my greatest fear. I have a copyright warning on every page that mentions the $10,000 fine per copyright violation, but I still worry. Since virtually all LAN customers are federal agencies, though, I’ve decided this is not such a great danger–federal agencies aren’t (or shouldn’t be) in the business of stealing copyrighted materials.

. . . yeah, but what about those individuals who buy the Guide on CD-ROM? Maybe they don’t have the same scruples as federal agencies.

Well, um, the individual CD-ROMs are copy-protected . . . uh, that is, they’re supposed to be . . . but, um, actually, don’t tell anyone, they’re not. Vendor failure.

. . . so, you’re screwed, right?

Maybe not. After all, even if someone were to rip us off, Congress isn’t going to stop writing new laws, and agencies will go on beavering out new regs. Come next January 31, there’ll be a new edition of the Guide, and someone who’s pirated the old one will just have to do it again. By that time, maybe we’ll even have found a copy-protection vendor who knows what he’s doing.