Parlaying Privacy into a Career
January 27th, 2012After working for a non-profit organization researching and writing on the subject of personal privacy, a young journalist named Robert Ellis Smith found himself out of work when the organization’s funding dried up. Smith decided to launch a monthly newsletter on the subject, similar to the one he had started for the non-profit organization in Washington, D.C. Smith wanted to tide himself over until he found another position in the Washington world of public affairs, advocacy, and politics. That was in 1974.
Robert Ellis Smith
In November 2011, his newsletter, Privacy Journal, celebrated its 37 anniversary. It is among the longest continuously published newsletters in North America.
Smith used his severance pay from the organization to finance the first issue, dated November 1974, and the second issue and to support his wife and two toddlers. He worked from a 15 foot by 40 foot bedroom in his home on Capitol Hill, 10 blocks east of the U.S. Capitol. That meant he was nine blocks from the Library of Congress. He relied heavily on it in the pre-Google age, mainly for names, addresses and phone numbers of prospects for his newsletter. He mailed them sample copies of the first issue with a solicitation letter and a return envelope.
An eager young secretary at the non-profit association agreed to work as the assistant to the publisher for a modest weekly amount plus deferred salary.
Three times a week, he nearly trotted to the post office box he had established. He has kept a post office box ever since to separate and keep safe the business mail that a home-based business receives. To have it delivered to his home would have been chaotic. In the years since, neither he nor his assistants have misplaced a single piece of business mail.
Soon the subscriptions started to come in. The publisher, now 36 years old, began to realize that periodicals get their income up front for the entire year. This would finance the growing publication. (Tax on the income covering the next tax year may also be deferred.) In addition, because they get paid before they provide the product, publishers need not worry about bounced checks and credit checks. If his printing company sends a bill for each issue with 30 days to pay – and is often generous with extensions – he is all set. Postage is his major up-front expenditure.
New subscribers kept asking about laws covering personal privacy. Soon he put together what he called “Compilation of State and Federal Privacy Laws.” It began as an eight-page variation of the newsletter, with about 80 laws described and cited. After several supplements and reissues, he still publishes the valuable reference book today, with more than 1000 state and federal laws listed. It’s a perennial best seller. It accounts for 30 percent of his revenue.
Smith made it a point to get involved with a small trade association of newsletter publishers. The advice was free, it was accurate and helpful, and the camaraderie was great. Many of the colleagues dispensing free advice worked for the company that dumped the largest amount of materials into the mails in the District of Columbia. He learned how to compose effective sales letters, to judge results of mailings, and to always include the essential components of a direct-mail package. Never mail without a “response mechanism” (a return envelope), and use the P.S. in a sales letter to full advantage. The debate over whether or not it is necessary to put a stamp on the response mechanism has never been resolved by professionals in the field.
His main source of advancement was not space advertising or mass mailing but TV and radio appearances and participation in trade conferences. What he liked about newsletter journalism was that he and his colleagues worked both the writing side (“editorial”) and the business side. Whenever he approached a news source or attended a news event, he made a pitch for subscribers. The news sources knew this was a publication about their niche and they wanted it. Often he asked a question at a news conference only to publicize the new publication. Wherever he went, he grabbed a list of attendees because they were the most likely prospects for direct-mail advertising.
Within six months of his first issue, one of his sources provided a valuable news tip. Publishing this “scoop” gave the publication enhanced credibility.
In about a year, he applied for a $5000 loan for mailings, secured by his home, and he got it. Within three years he was able to pay the deferred salary to his assistant. He got $5000 loans three subsequent times.
All along, he kept telling himself that his focus was longevity not expansion. In the 1980s and 1990s he reached $150,000 gross sales and had one full-time and one part-time employee. When his family decided to move from Washington to Rhode Island in 1986, he found that the business was perfectly portable. He packed it up and moved in to larger space in his new home without missing a beat. At about that time there was an attempt to make sales through retail outlets. Distributors were hard to find, and the effect was discontinued even though it was realizing a small profit.
Since then, the business has faced competition from corporate publications and free blogs on the Internet. Circulation has not expanded. He had held on though, supplementing his income with more books, speaking engagements, teaching, and gigs as an expert witness. There is a strong core of repeat business among law libraries and individuals concerned about their privacy. Sales lag among the newcomers to the “privacy space.” Smith is now ready to sell the business because he has reached retirement age.
He uses email a lot to prospect for subscriptions and book sales; he keeps his Web site, www.privacyjournal.net, fresh and useful to visitors; he has an electronic edition, orders@privacyjournal.net, along with the hard-copy edition. He has made good use of hard-copy book sales through Amazon.com and has digitized all of his books for sale on Kindle, other eReaders, and apps for handheld devices. He has sat through more workshops on using social media than he can remember but has not yet made the plunge (mainly because he distrusts the privacy policies of the social media companies). He’s persuaded that social media can help, but he is not sure how much.
What did he not know when he started? That a lot of customers want to be billed and a new business needed back then to be prepared for that. Since Privacy Journal began accepting credit cards and Paypal, hardly anyone asks for an invoice now.
The biggest threat? Cutbacks to funding for libraries. Also, abusive practices by book distributors and chain bookstores. But they are gone now and Privacy Journal keeps going, positioned to be acquired by a larger publishing house.
