How We Acquired 400,000 Subscribers And What You Didn’t Know About Email

Sree Vijaykumar is the founder of TradeBriefs, which helps every professional become an industry expert through daily email newsletters. TradeBriefs is in our current accelerator batch at 500 Startups. Previously, Sree also co-founded All India Retail and worked at DeloitteIBM Global Business Services, and i2 Technologies. He studied Carnegie MellonColumbia, and IIT Bombay

This post was originally posted on the TradeBriefs blog.

The Beginning

TradeBriefs started off as as an attempt to solve a personal problem. When the organized retail business in India started taking off a few years ago, I was a Retail consultant in the US, eagerly watching the space. The lack of a comprehensive and reliable source of information on this exciting new sector is what made me start our first portal and newsletter – India Retail News (www.IndiaRetailNews.com). Soon, we had visitors and a few subscribers for the newsletter. Open and click rates were high, so I knew we were on to something.

Offline Subscriber Acquisition

After the move back to India, my initial efforts to get subscribers revolved around in-person acquaintances at conferences and events. Soon, we had interns collecting business cards and lucky draws to attract more subscribers from offline events. Our Retail training venture (the pre-pivot business) helped us gain word-of-mouth publicity and more subscribers. However, subscriber growth was so slow that we really didn’t know if this could be a viable business.

Our First Advertiser

One fine Monday, a consulting startup founder I had met at an event, called me to ask if he could advertise with us. I wasn’t sure if it would be a good investment for him and offered him email marketing at a nominal cost to begin with. His email to our audience of 10,000 subscribers got him several email responses, 10 of which were good leads (3 of whom eventually went on to become clients). We were in business!

BBC World News

We used the money earned from our training business to grow our newsletter venture. I hired our first editor. More raffles, more business cards, more subscribers. We made our presence felt at Retail conferences. Our newsletter was becoming the most comprehensive and trusted source for industry information. And one day, I got a call from BBC World News. They wanted a reliable estimate on the size of the Retail industry in India, with projections. We had no clue! I quickly ran through a bunch of reports we had curated, called a few industry folks and cobbled together some estimates. Our brand was on TV! The visibility helped us get some more subscribers and interest from advertisers.

Subscriber Needs and Advertiser interest go hand-in-hand

One thing that has caused good things to happen to us from the beginning has been our focus on subscriber needs. Even today, when I go through our subscriber logs to check what is working and what is not working, it helps me give direction to our offerings. And the best part about focusing on your audience is this: If you focus on subscriber engagement, the content stays relevant and subscribers will love you and Advertisers will find you! To this day, almost all our advertisers (including large ones like Ogilvy and The Financial Times) have approached us, rather than the other way around.

TradeBriefs is born

I remember having this conversation with my chief editor one evening. We seem to be doing well, she said. I agreed and thought to myself – we are doing this for Retail, but can we do this for other industries – can we scale this up to something much bigger? Some research on the internet made it pretty clear that there was a need for an industry-focused offering in several industries in the country. Within a matter of days, we put together a plan and launched 4 more verticals – Telecom, Finance, Software and FMCG.

The Dark Underbelly of Email

By now we were relying on SEO to get most of our subscribers. Offline subscriber acquisition was expensive and not scalable. Since we had started small and accidentally landed up in the email newsletter business, we ended up building all the email infrastructure ourselves. Over a period of a year, we educated ourselves on SMTP, IP reputation, Complaint feedback loops, Relay servers and all the wonderfully dark alleys of the email universe. In the early days, we would sometimes get asked why we charge so much for marketing to our audience, when one can purchase 10 million internet addresses on the internet for $100. Depending on the sophistication of the audience, my responses would range from – “That’s just illegal” to “Imagine your sending reputation to be like a credit score and how you’ll get screwed for life if you default on a big loan. That’s what will happen to your IP and domain if you try to send an email to 10 million addresses bought off the internet”.

What is truly Opt-in?

Very soon we got our own lessons in what happens when you piss off the cops in the email universe, namely the email providers (aka yahoo, hotmail, gmail, etc). While Gmail provides an Unsubscribe header option and Yahoo, Hotmail and others provide feedback loops where they let you know which subscribers are marking you as spam, it wasn’t very clear to us upfront why someone who has opted-in would mark your emails as spam. Well, for that we have to dig into what “opt-in” really means. The easier you make it for someone to sign up (let’s say by dropping a business card at an event), the easier it is for that person to forget why they signed up with you in the first place. Also, if you use the wrong incentives (like a cash prize) to get your users to get their friends to subscribe to your service, the more spam they send and your IP reputation suffers in the process. Besides, the more emails you send someone, the more you are likely to be perceived as spamming them; no matter how relevant you think that information is for them. Even some large companies like Facebook have learnt this the hard way. Access to someone’s Inbox is a privilege and should be treated as such.

The Future

We have 400,000 subscribers today, who trust us to provide them with industry information on a daily basis. It is a privilege for us to be able to reach them and every once in a while, we let our advertiser partners access that privilege. So, for those of you out there who are thinking of using email as a mechanism to communicate with your audience, remember that it is an excellent medium (There are more Email Inboxes being read every day than any media channel in the world), but tread cautiously!

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Gangnam Style For Startups

 

Chang Kim is a 500 Startups founder/mentor. Currently Chang is the CEO of Tapastic, a new online platform for webcomics and visual stories. Prior, Chang was a product manager of Blogger at Google. He joined Google when TNC, a blogging software company he co-founded, was acquired in 2008. Prior to TNC, Chang developed mobile content strategy at Samsung. 

Korean pop singer PSY and Gangnam Style have become a global phenomenon, boasting over 700M views on YouTube to date. You see Gangnam Style everywhere – on US radio stations, played at professional sporting events, on TV. Despite the craze, PSY is the only Korean music artist to go global so far. The vast majority stay local to Korea. It begs the question – why hasn’t the Gangnam Style craze opened the door to more K-pop hits going global, when there are plenty of other K-pop stars who arguably have much better global appeal than the chubby PSY?

This is the same question that entrepreneurs like myself, who are trying to bring a proven business model in Korea to the U.S. and the global market, ask themselves: What does it take to bring something big in one part of the world to another part of the world? How do you successfully overcome cultural differences?

Webtoons: A Cultural Phenomena in Korea

Webtoons are arguably one of the most popular internet and mobile services in Korea, the country that pioneered many new and interesting internet business models, including Q&A services, internet telephony, virtual goods, and MMORPG. Although Webtoons are a relatively new service, more than 10 million people in Korea (approximately one-third of the nation’s total internet users) check out Webtoons every day. Naver Webtoons (contents in Korean), a popular Webtoons service in Korea, generates 1B pageviews per month – more than Facebook’s total monthly pageviews in Korea. The Webtoons mobile app is also one of the most popular of any category in Korea.

So, what are Webtoons? It’s like YouTube for webcomics, where users can find hundreds of interesting webcomic series, or (if one is talented enough) start publishing his or her own series. Click here to see Naver Webtoons, the most popular Webtoons service in Korea.

At our company Tapastic, we understand how Webtoons gained popularity in Korea and “export” it globally. The first and foremost reason – content is king. In the U.S., superheroes dominate comic story lines. In Korea, Webtoons feature various genres of webcomics that casual, mainstream users can easily relate to. Webtoons are more like casual social games, while superhero comics from Marvel and DC are like World of Warcraft. Webtoons span almost any “everyday” topic – school, work, diet and exercise, pets, travel, recipe, horror stories – you name it. This variety exists because Webtoons provide an open platform for amateur artists and storytellers to publish their work and become overnight sensations (similar to YouTube celebrities).

How to Bring a Successful Business Model from One Market to Another

Webtoons are obviously very popular in Korea, but that’s just one small part of the world. So how do you overcome cultural differences and bring a business model that’s proven only in Korea to the U.S. market and beyond? We’d like to share our strategy below. We hope it might be helpful to others who are interested in taking a similar, cross-border approach with their companies.

1. Tools, not content (or anything too culturally dependent)

When CyWorld, a Korean social networking service, launched in the U.S., they decided to keep their “cute” identity defined by things like 8-bit avatars and “mini rooms”. But the average U.S. internet user found those to be too cutesy and even “childish”. Even in this hyper connected world, cultural differences still exist. When it comes to bringing a business model from one market to another, it’s always a better approach to bring the “tools”, which usually are independent of any particular culture. Skype is a good example; whether you’re in Brazil or Bahrain, Skype is a useful tool. The product functions the same, regardless of what country a user is in. Even if a product is not purely a tool, services like Spotify can present a “global” service, yet distribute “local” content through the service. This is our approach – we bring the tool (originated in Korea), but populate the service with local-flavored content from talented local artists.

2. Build a local team and let them run the show

It’s critical to build a talented local team and have them become the first believers in your business model. Check your ego at the door, be humble and listen to your local team’s feedback. But at the same time, make sure the team correctly understands and sees the inherent value that made the business model successful in a specific market. Unless the local team is excited and motivated and sees the potential of the business, you can’t expect them to endure the challenging startup journey and work their butts off to make the idea work. As they say, a startup is only 1% idea and 99% execution. When it comes to execution, the local team will do the lion’s share of the work.

3. Lead the way with a minimum viable product (MVP) and get early feedback from the local audience

The purpose of building a MVP is to put something out there and get user feedback quickly and early. For startups that are exploiting cross-border opportunities, it’s even more important because you never know if your product has any potential in the local market and you don’t want to waste too much money and time until you do that initial validation. That’s the approach we took as well – we built the MVP first. Within three months, we gathered tons of valuable feedback from early users. Based on the feedback, we pivoted and re-launched the product’s second version (which we like even better) in the span of three months.

In conclusion, that is our three-pronged strategy to bring Korean Webtoons to the U.S. market. Whether our strategy is right still remains to be seen. This is what we have to figure out in the months and years to come – and we’re excited for the journey!

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