Adapt, Diversify, and Grow

The Internet is creating a huge new universe of commercial opportunity. ISPs with the imagination to step outside the accepted definition of Net access can grow forever.

by Doug McDonald Director, Affiliate Programs, The TUCOWS Network courtesy of HowToSell.net [December 17, 1999]

Throughout my first three articles here, I have talked consistently about the need to think outside of the box, and to explore the coming wave of revenue opportunities and the supplemental revenue streams available to you through Value Added services. I now find myself thinking about comments I heard in New Orleans at ISPF [in November 1999]. Immediately following a presentation I gave on the importance of these opportunities, I found myself being asked if I thought it was really necessary to be diversifying outside of the dialup and leased line business. My answer was "only if you want to be earning a better living." I realize the importance of guarding your core business. I am not suggesting you abandon it, just to augment by adding new services a part of your core business.

Untapped potential
It amazes me how few people in this industry really see the potential and embrace the future with its myriad opportunities and challenges. When it comes right down to it, the Internet is almost everywhere now, and will be absolutely everywhere very soon. The implication of this for the ISP is that you will soon be people's link to the world. Some of us may joke about spending so much time online that we don't have a life, but very shortly, folks who aren't online will have lives decidedly less full of opportunity than those who are. Your ability to entrench yourself in their minds as the font from which their improved life flows can pay big dividends in the coming years.

There are a growing number of opportunities for ISPs to partner with "non-traditional" organizations to assist you in these endeavors. Let's look at a few.

Cash in on banking
Internet banking is a good example. Internet banking has exploded in recent months as the banking community realizes the dramatic savings they can realize by keeping their customers out of their branches and getting as many of them as possible to bank online. Partnering with local financial institutions to bundle a trial access package for all their new customers setting up an online banking or trading account is a sure-fire method for adding customers.

Dish up new revenue
Another example would be cooperative ventures with local restaurants. Virtually all shops have fax machines now. With recent improvements in Internet fax technology, there's a real opportunity for virtually all restaurants, regardless of size, to be taking lunch and supper orders via their website. This website—which you host, of course, and which you arranged for the design of for a small referral fee—interfaces with the email-to-fax software that you operate on behalf of multiple clients.

With this type of implementation, restaurants and fast-food establishments could take orders via the Internet with out needing to check their email every three minutes—and doing it all with a familiar technology they're already comfortable with.

As more and more offices bring access to every desktop, the convenience of ordering lunch for delivery, or supper for pick up on the way home, is sure to increase in popularity. With specials for your customers only—which most owners or managers will do in exchange for appropriate promotional consideration—the additional "value" that you can bring to your client base is obvious. Promotional packaging and/or discounted or trial offers for your services could all be included with the food leaving the restaurant, thereby increasing your new customer acquisition rate as well.

Something for nothing
The best way to increase your perceived value is to offer something that others value highly but which in fact costs you nothing. Many of you send out a regular message to your subscribers. (If you don't, here is yet another reason to do so.) You could easily add a small special-offer advertisement to the top, bottom, or middle of the message, offering them a special with select local merchants. The offers increase the value of the message while earning you a small but welcomed additional revenue. To take this a step farther, why not have the ad link to the advertising company's website—which, naturally, you host as a part of the package.

Tie the threads together
These are three relatively simple ways to integrate your service into the regular "offline" lives of your subscribers. Acclimating your subscribers to conducting as much of their affairs and shopping online as you can will go a long way to increasing their dependence on you and your services. As their spending online increases and your affiliate revenue streams grow, your subscriber base will not only increase in its immediate cash flow value to your company, but in the eyes of investors or acquisition suitors, your per-subscriber value will increase as well.

I sincerely hope that these four messages have been of as much value to you as they were to me to compose. I thank those of you who took the time to contact me, good, bad, and indifferent in your opinions and suggestions. They are all of value and welcomed. I look forward to hearing from you all, and will be sitting down soon to think on what to pen next. Any suggestions or requests you might have are always appreciated.

Sincerely yours,
Doug McDonald

—End

Read the first three parts of Doug's series:
Pt. 1 - Valuing Your ISP
Pt. 2 - Wresting Customers from the Competition
Pt. 3 - New Revenue from Old Customers