Small Business

Beating the Postage Hike


A novel idea for cutting postage costs; search engine marketing tips; movies that inspire and teach; why romance counts for startups; and more

Cut Mailing Expenses Even As Postage Rates Rise

Sure, postal rates went up just last year. But another set of hikes goes into effect on May 14, lifting the price of a first-class stamp from 39¢ to 41¢ along with increases across the board. One piece of good news is that the USPS has tweaked its pricing system, basing it on shape, meaning that folding documents to fit into smaller envelopes will save you money. There are other approaches to consider as well.

One entrepreneur determined to save on this seemingly fixed expense buys at a 10% discount old but unused postage stamps—such as from the days when first class mail was 18¢ or less— from a local stamp and coin shop. It seems that shops like this buy large volumes of old stamps at steep discounts from heirs of collectors and then sell them at less severe discounts to businesses and individuals.

"The beauty of old postage is that it never loses its face value or expires," writes Dan Pritchett, director of marketing for Logos Bible Software in his blog. As a bonus, this local stamp and coin shop applies the postage to invoices and statements at no charge, saving Pritchett's company even more.

How Much to Budget for Search-Engine Marketing to Gain, Say, 10,000 New Users?

An entrepreneur launching a Web-based startup—and seeking to impress potential angel investors—asks such a question on the TechCrunch blog's forum and winds up with many suggestions, including:

Don't depend entirely on a paid search-engine initiative. If your product is as good as you think, you should be able to generate users via viral marketing.

Focus on getting people to take actions— for instance, signing up for a newsletter or asking to be called by a salesperson—and determine what percentage of individuals performing any of these activities will convert into users. If you convert 10%, then you need 100,000 sign-ups.

Consider enlisting a firm specializing in "cost per action." Then you pay only for prospects who've completed a specified action, like filling out a four-page form or calling an 800 number and staying on the line for at least 30 seconds, answering questions.

What Are the Best Movies to Educate and Inspire Entrepreneurs?

Noam Wasserman, a professor at Harvard Business School, especially likes Startup.com, a 2001 documentary, because it illustrates well the evolution of the founders' relationship, along with the intricacies of raising money. The 1999 made-for-TV docudrama Pirates of Silicon Valley, about the rise of Apple (AAPL) and Microsoft (MSFT), gets votes from some visitors to Wasserman's blog.

A site at the Whitman School of Management at Syracuse University that solicited film suggestions from entrepreneurship professors came up with Searching for Bobby Fisher, Run Lola Run, The Matrix, Apollo 13, and Dead Poet's Society.

Plus, I thought last year's comedy Little Miss Sunshine was a wonderful depiction of how not to go about starting a business.

The Best Startups Have Customer Relationships Tinged with Romance

So suggests Susan Wu, a venture capitalist at Charles River Ventures. "Think about your most recent romantic relationship," she says. "The stronger you feel about someone, the more likely it is that you are going to 1) spend more time with that person and 2) explore the depths of the relationship's possibilities." It's the same with startups. "Whenever I evaluate a new consumer startup, what I am constantly ruminating is 'What is the relationship between this service and the user who uses it?'" She sees emotional intensity as correlating with how much attention a user will spend on a product or topic and the quality of the interaction the user is likely to have with a service. For more, see her blog.

UPS Goes International with Its Third Annual Out of the Box Contest

The shipper seeks "the most innovative small businesses" with annual revenues of $250,000 to $10 million. Eligible businesses can now come not only from the U.S. but also from Canada, Mexico, China, the Philippines, and Singapore. Top prize? $25,000. For information, see UPS's (UPS) contest Web site.

David E. Gumpert covers business/health issues and also writes the biweekly What Entrepreneurs Need to Know column.

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