Firm Touts Online Bids for Offline Mail WorkDirectMailQuotes.com plans to begin placing its lettershop bid solicitation service on other firms' Web sites, and President William Spero is tinkering with the company's business model in hopes of getting steady revenue flowing by midway through next year.
The plans are ambitious for a firm that earlier this year was nothing more than a loose idea sparked by Spero's need for a floor scale.
In January, the executive searched online for a scale that American Mailing Systems Inc., his grandfather's Burbank, CA, lettershop, could use to weigh mailings. He found a site that let him enter what specs he wanted from a floor scale and arranged bids from several manufacturers.
"They contacted me, got me prices back, and I thought, 'That was really easy,'" Spero said. "So it's kind of a stolen idea. What can I tell you."
DirectMailQuotes was born. The company built a site and carried out four direct mail campaigns between January and June trying to lure the roughly 3,600 U.S. lettershops to its membership roll. DirectMailQuotes, also in Burbank, offered shops free leads through July of 2000, and the firm now has about 1,160 members who bid on jobs through the service.
Direct mailers visiting the site enter the type of mail piece they want sent, its weight and postage specifications. For marketers who want bids on relatively simple jobs like postcards, for example, DirectMailQuotes is building a "quick quotes" section of the site. More complicated jobs will still be handled as they are now -- marketers enter detailed information such as whether nesting is involved, and the extent of mailings' personalization.
DirectMailQuotes instantly dishes up the names of eight appropriate lettershops in marketers' geographical areas. Users specify whether they want the quotes via mail, fax, e-mail or phone, and they have the option of skipping bids from shops by unchecking a box next to their name. Then they hit "send." DirectMailQuotes sends lettershops an e-mail telling them they have a "request for quote." Shops handle all interaction with marketers from there.
When they sign onto the service, lettershops give DirectMailQuotes their specifics: what kinds of work they handle, the minimum job they will consider, and the maximum size mailing they can handle in-house. The shops also fill in information about any other services they provide, such as graphic design, data processing or data entry.
As of late August, the firm's URL -- www.directmailquotes.com -- was getting about 1,500 unique visitors weekly. Spero acknowledges it's unlikely such numbers are high enough to get lettershops to pay a subscription fee for the service. If he wants to charge shops the $500 to $5000 annual fee he plans he has to deliver more requests for quotes. That's part of his motivation for placing the service remotely on other businesses' Web sites.
The idea of running an e-commerce service off one company's servers and placing it on sites operated by other companies isn't entirely original. For example, UPS, Atlanta, places its package-tracking service on other sites, and GoTo.com, Pasadena, CA, puts its search engine on outside Web destinations. At least one lettershop -- San Jose, CA-based ELetter Inc. -- makes its direct mail services available through affiliated e-commerce sites such as Office Depot Online.
Spero plans to pitch a remote "find mail-house" portion of his service to list companies first, and he wants to target office supply sites, corporate intranet networks, and other pages attracting small businesses as well. He expects to get the program up and running by October or November.
"The technology's not that complicated," he said. "It's the marketing that's the hard part."
Also within the next three months, DirectMailQuotes plans to start holding online auctions. Spero hopes to take a commission on printing equipment the firm sells to lettershop members, and the company has begun talking informally with manufacturers Pitney Bowes Inc., Stamford, CT, and Scitex Corp., Herzliya, Israel.
DirectMailQuotes will debut online banners this month, but Spero would not elaborate on where he plans to place the ads. The company will launch print advertising in industry publications afterward, said Spero, who reiterated that the company's main priority is to get users to the site now that the lettershops are in place.
"At some point, and I think it's already happening, but I think at some point in the future, there's going to be more people using the Internet to find a lettershop than using the Yellow Pages," Spero said.