Reference Press Moves Data On-Line, Challenging Bigger Financial Publishers
A PUBLISHER of corporate information has set up shop on the Internet's World Wide Web, where it gives away some of what it sells elsewhere.
Like the Frango Mint handouts at Marshall Field's department stores, the information giveaway by The Reference Press Inc. aims to draw traffic. The Austin-based publisher, which is part-owned by Time Warner Inc., hopes visitors to its Web site will see sponsors' advertisements and subscribe to additional services.
Such creative but risky strategies have allowed commerce to colonize the Web, transforming it from a sleepy gathering place for academics to a bustling virtual mall with 23,000 businesses. And that number grows by 30 percent a month, says Jeanne Dietsch, vice president of ActivMedia Inc., an on-line marketing consulting firm in Peterborough, N.H.
Fueling the explosion are surveys of Internet browsers. The latest by the Georgia Institute of Technology found that potential cybershoppers outnumber committed freebie-seekers by 4 to 1 on the Web.
Reference Press wanted to reach that market. In July, it unveiled a Web site that allows users of the free information to buy on-the-spot access to proprietary products. Ms. Dietsch regards that as ''fairly cutting edge'' and ''something the front-runners are doing.''
That's not surprising. Reference Press was started by Gary Hoover, the entrepreneur who founded Bookstop, which in just eight years grew to be the nation's No. 4 book chain. He sold it to Barnes & Noble in 1989.
While managing Bookstop, Hoover saw a need for reference books about companies. Targeted at readers like job hunters, investors, and salesmen, the books had to be lively and affordable. Those criteria ruled out the well-known volumes published by Moody's Investor Service and Standard & Poor's for libraries and corporate users.
''It's a monster,'' admits S&P's spokesman John Diat of his company's Register of Corporations, a listing of 55,000 businesses that fetches $625. Moody's Industrial Manual alone costs $1,150.
Business profiles on-line
After starting Reference Press in 1991, Hoover created a self-named series of snappy business directories and profiles priced well under $100. In 1993, these guides debuted in commercial cyberspace beginning with America Online. ''They're very popular,'' says AOL spokeswoman Kathy Johnson.
But availability on every commercial on-line service didn't satisfy Patrick Spain, the college buddy Hoover brought on board as CEO in 1992. Mr. Spain wanted to reach the millions of Web surfers who bypass the commercial services. ''We believe that both [marketplaces] are not only viable, but vibrant,'' Spain says.
Visitors to Hoover's Online Web site get free access to a database of capsule information on 8,500 companies that Reference Press sells in book form for $50. Not only that, the on-line list includes nifty, built-in search capabilities. Browsers who activate a hypertext link to Hoover's detailed profiles of 1,500 companies are asked to pay $9.95 a month for that access.
Links to other Web sites
Hoover's Online also offers free links to other Web sites: Edgar, the database of company filings at the Securities and Exchange Commission; Cambridge Interactive, which charts current stock prices; PAWWS, for transacting secure on-line stock purchases; InfoSeek, for finding all references on the Web to a company; PR Newswire, for companies' news releases; and companies' own Web sites.
Usually on the Web, activating a hypertext link takes the user to another home page. Hoover's Online improves on that. For instance, a user can jump from Hoover's data on Coca-Cola directly to a chart of Coca-Cola's stock price without stopping at the Cambridge Interactive home page to search for the soft drink maker by name.
Hoover's Online hopes to attract thousands of users. But ultimately paid advertising placed among the data like miniature billboards will support the free portion of the service.
Spokesmen for Reference Press release no performance data on Hoover's Online service. But they project that 30 percent of the company's $3 million revenues this year will come from electronic/on-line products.
More established Web shops have already proved the potential for business. A survey by ActivMedia last spring, when only 7,000 businesses were on-line, found that 60 percent of Web sites generated more than $1,000 a month in sales. Three percent do better than $100,000 a month, Dietsch says.
Hoover's Online already has competitors such as Disclosure, featured on the Web and commercial services. Standard & Poor's has a committee planning to colonize on-line territory. ''You can assume we're talking to all the major commercial services,'' says a secretive Walter Arvin, who leads S&P's on-line strategy.
''The whole business is evolving so quickly,'' says Barry Cinnamon, president of Allegro New Media in Fairchild, N.J. It's hard to tell where tomorrow's money will be made, or which business alliance will prosper or backfire.
His company teamed up with Reference Press to publish Hoover's corporate profiles and business video clips on CD-ROM. While viewing the CD, a user can connect with an on-line service to see current stock prices.