Ask HN: How to make a profitable business from a newsletter app?

[bosslee]

Hi, My name is Bryan and Happy Holiday to all hacker news readers.

situation: I created a project that helps instagram users to rediscover their old photos buried down deep in their timeline. It’s a service that randomly draws a photo that the user taken 6 months on instagram and sends it to them via email on a weekly basis. (like the flashback feature, that everpix just to have)

questions: 1. what is a likely business model you would use in a pdt like this that only engage with the users once a week via email.

Initially, I was thinking of adding ads into the email that I sent. However, I later realised that it is not possible todo that. adsense programme does not permit adsense ad code to be placed in email messages

some plans in mind: - Advertiser-Supported Email Newsletter - still go for ads, but I would go and find sponsors. Like the sponsored post on iosWeekly or JavaWeekly

- Or I try to add features to the emailer. For example. I will add flickr integration and this is a paid service. (but I also understand from many HN reading, that to be a paid service I must really be solving a pain point. (which I think I am, but I’m not sure thou)

- Or I would go for open source. Maybe be using gittip service. If there is donation, great. Otherwise I would just let it run, since I using the service myself.

What do you think? How would you create a business model around such a product. Love to hear your feedbacks.

p/s this is actually my first post on HN and to avoid fellow readers to think that I’m creating an Ask HN question to spam my project url. I did not put project link in the question itself. But if you any of you are interested to find out more so that you can help advise me. The service is here (http://bit.ly/marcusapp)

[ada1981]

1)set up an affiliate deal with a service that turns the photos into real products and integrate with their API.

Send them the photo, and then give them the option to buy a print / hat / sticker / skin / etc.

2) you can use display ads from other networks in your email news letter if you want to try that, but it's a pretty abstracted revenue stream

3) sponsorships are much better than ads on low traffic properties.. I have luck selling ads at close to $1k / cpm equivalent for a blog I ran.

4) joint ventures -- run the app for free and then once a week / month / whenever promote a specific offer to your list.

5) I'd be focused on getting users first and probably the only action I'd want them to take is to recommend the service to friends.. Otherwise, you are trying to reinvest ad revenue from users to recruit more users - it seems that focusing on getting your viral coefficient above 1.0 would be a better use of focusing the actions of your users since the users are the best evangelists... Maybe even just having a feature for them to share the photo on Facebook, etc and include a link back.. Better yet, have an automatic option to autopost the throw back photo to their time time.

[bosslee]

thanks for the reply and suggestions. I agreed and feels that sponsorships (in this case) might work better for me. JV is definitely something interesting for me to try out too.

I realised that dkokelley and you shared a common advice for me and that is to grow the users first. I totally agreed with that.

This is my first web app too. So I also I like to ask in your opinion and dkokelley how long would you give your pdt/service a chance to reach product market fit? Currently I have on 30 signups. What if after 3 months it stands at 300 users? Do you use number of users as a metric?

Thank you :D

[ada1981]

Sign ups will help you determine your cost to acquire a customer and how predictable that can be.. I'd look at that more than raw sign up numbers.. Also, how many people do you need to make money?

[brunorsini]

I would frame this slightly differently: "How can I make these emails absolutely delightful to users?" Once you nail this you should make it dead simple for happy users to recommend the service to their friends.

As for monetizing the happy and (hopefully) growing base... It won't be easy but I would focus on your main strength: unlike most advertisement inventory you have people's email addresses, which could give you a good head start on the "who" question. Maybe you could even ask an optional question or two as part of your sign up process to give you more data on your users, and based on the combined info you get you could write simple scripts to try and extract the most out of each one.

For instance: if the user is in a country served by Amazon, suggest a different product you actually really like on each email you send out (shouldn't be that much work to curate a basic list of things that caught your fancy). Personally I would make it very explicit that you're:

- adding an affiliate link to the product, which helps pay for the service in question

- you actually do use and like the product (for reasons x, y or z)

I would also make it incredibly simple for users to put money in your hat if they choose to. Paypal recurring payments could be an option here - https://www.paypal.com/pdn-recurring.

[bosslee]

hey :D amazon affiliate link is a great idea too, and you are right that I would need to make it transparent for the users. Maybe I could also test on the following hypothesis that "people who loves using-smart phone for photos, might be interested in camera pdts as well" - I could be sharing some of the camera items I brought off amazon.

And I really like the way you rephase my question."How can I make these emails absolutely delightful to users?"

Thanks

[Theodores]

I think you are getting way ahead of yourself in some aspects, as of yet you have not done anything to make your service 'sticky or viral'.

How about this:

Create a website called "Life goes on..." (or something like that, 'It wasn't that bad really' also conveys the sentiment).

In your newsletter send a few news headlines for the day that the regurgitated instagram picture was taken.

Invite your subscribers to post the picture to the "Life goes on..." site, with a few words regarding what they were doing.

On the "Life goes on..." site juxtapose the big picture media headlines for the day (which are inevitably bad things) along side people's happy stories. Allow some simple tagging system for submissions to facilitate this. For instance, recently the entire world was in mourning because Africa's greatest ever Freedom Fighter passed away. However, whilst that was going on plenty of other people were celebrating christenings, new births and that sort of thing.

Allow people to upvote, add comments, share and so on. Make it searchable/sortable by tags.

Also consider music, people like to have a soundtrack to their lives. Do something with that.

You will be able to create a site useful to social historians and give people a means to participate in the project in a fun way using your original idea.

Most importantly to you, there will be something to monetize using the standard advertising model we all know.

[elohesra]

Wow, that's possibly the most hilariously offensive idea I've heard of in some time. Given your lionization of the man, you clearly care about Mandela, so imagine the product you're suggesting: a big picture of Mandela with some sort of respectful, eulogizing headline, next to which is a picture of a lolcat with some glib pun, and the -- almost sarcastic -- title 'Life goes on' above both.

The mental picture alone is amusingly objectionable.

[Theodores]

Actually we have that already in newspapers.

Do you want me to dig out the Daily Mail front page with the President doing a selfie, Miley Cyrus twerking and an X factor winner doing something pointless?

I am proposing something far less objectionable to that which passes as 'normal' for the media.

[elohesra]

There's a reason that the Daily Mail is held up as a figure of ridicule.

EDIT: While amusing, my glib original answer ignores one important point: the Daily Mail sells, and it sells extremely well (it's the most circulated UK newspaper). However, while it's true that the Daily Mail does precisely what the parent poster is proposing, I'd argue that the internet demographic (especially the photo-sharing/social media market) tends to swing younger than the Daily Mail's audience. This will result in young people either:

A) deliberately gaming the site to show offensively contradictory images alongside each other (e.g. something racist next to Mandela) or B) complaining about situations like A

While the Daily Mail does peddle in hypocrisy and bile, it peddles in carefully curated hypocrisy and bile. It knows its market well, and it knows what it can juxtapose. It knows it can rant about paedophilia on one page and then write saucy articles about teenaged royals on the next page, because it knows what its market will tolerate. Allowing a crowdsourced attempt at the same will result in mayhem that targets nobody and offends a lot of people.

[bosslee]

you are right, I might be getting ahead of myself. Because tbh I only have 30 users right now :D But I thought it would be good to have a propose business model in mind before moving deeper into the project.

As for the site to allow users to repost their image > I like this. Maybe I can create a tumblr site and allow users to submit photos.

Thanks for the suggestions.

[dkokelley]

I would start by just offering the service and gaining traction. I think trading the service offering for occasional or integrated marketing emails is acceptable for most users.

Over time, you will build your user base/email list. You may be able to identify certain segments within that list that share a particular interest. Now you know what these users like, and have explicit permission to market to them. Use this service as a platform to engage your users and discover other ways that you can add value to their lives in such a way that they are happy to pay for it.

In summary:

1: Build the service, get users

2: Where possible, segment those users by interest

3: Based on the major interests, build and/or sell other products that your users will pay for

[wikwocket]

Check out Dan Lewis's great newsletter "Now I Know," for ideas on content, advertising, and list-growing. Dan is here in HN as @DanLivesHere. He probably has ~100k subscribers now, and monetizes with ads and Amazon affiliate links.

Here is the newsletter: http://nowiknow.com/

Here is a good interview with him: http://www.mediabistro.com/10000words/now-i-know-real-person...

[wellboy]

Give your users a link where they can print out their Instagram photo and partner up with Instacanvas. That's what I advise everybody having a business based on Instagram. Making money online with Instagram is just not worth, however, going for physical products is.

They make millions of $$ with it and it's such an easy business.

http://techcrunch.com/2012/05/09/instacanvas-launches-global...

[aitchjay]

Are you familiar with Timehop? Your concept sounds similar, though I don't use the app and may be wrong. In any case, it might help to look into how they monetize.

[ben_hall]

Yep, very similar - in fact I wouldn't be surprised if Timehop added this as one of there options as they already do twitter and facebook.

I use Timehop but not sure about any user facing revenue model. They do however have the last 5 years of facebook and twitter data about me so I'm sure they're making some money from that.

[bosslee]

yep. just check them out. there is no business model for the users. How do you find the service Ben? I read a post that they used to send daily emails. Do they still do that?

[ben_hall]

I get daily iOS notifications. I have a feeling if I didn't open the application then I would get an email which is a really nice way of handling notifications.

[bosslee]

oH. Did not know of Timehop. Just check them out. I would say the service is much similar, just that Timehop is a mobile app. While mine behaves much like a newsletter.

Thanks for sharing.

[jamesdeer]

Sponsored Pics.

One email per week sent is an ad (on a random day). Build up as much data about each user as you can which you can then offer up to advertisers. E.g. Email all women who like jeans with a sponsored pic.

$lowXX to remove ads.

Also offer backup service for small additional fee.

Partner with a service like blurb to send Instagram photo books to users of their old pics. Perhaps suggest the images that should be used in a book?

Back to beer.

[bonemachine]

If you want to spike traffic, you can always follow the good example of Ron Paul & Associates, and start peppering your articles with random racial, homophobic and other gratuitous provocations. Don't overthink it, and don't make it too obvious; instead aim for approaches more oblique and back-handed, in the spirt of, e.g.:

“If you have ever been robbed by a black teenaged male, you know how unbelievably fleet-footed they can be.”

You can also try opening with catchy titles like "The Disappearing White Majority." The idea is that, sure, such tactics will probably offend some people, but they will also generate controversy and get you talked about. And if you get flack from anyone over it, you can always claim it was the work of junior staffers, and that you had "honestly do not know" who might have said those things.

[conjecTech]

Wow, this is the most unnecessary and untimely comment I've ever seen. This has absolutely no relevance. This does not even address the question being posed and goes off on a wild tangent that can only be meant to incite others and detract from the conversation at hand. This doesn't belong here, and I'm questioning whether the kind of person who would post such a thing does either.

[bonemachine]

Apologies to anyone who felt distracted or incited. I assure you that wasn't my intention.

[username223]

So your business is to ask people for their Instagram/Facebook credentials, then send them their old pictures wrapped in ads? Everpix already tried doing something much better than this, and crashed and burned.