In the old days, companies hoped to sell their products and services just by telling customers how good they were. And back then, that often worked just fine.
Now, companies must do far more than boast.
"Rather than tell customers we know, we have to show them we know," said Susan Fleishman, director of marketing and communications for KPMG Peat Marwick in Baltimore.
One of the best ways to do that, Ms. Fleishman said, is for the international accounting and consulting firm to publish newsletters for the markets it serves, such as the health care, insurance and real estate industries.
Informative rather than hard-sell in nature, the newsletters work to demonstrate KPMG Peat Marwick's expertise to customers.
"We go to great pains to make our newsletters as informative as possible," Ms. Fleishman said. "By informing our public, we position ourselves as professionals who know that particular field."
Once the company rag that no one took very seriously, the newsletter has come of age as an effective marketing tool. Newsletters offer companies a way to communicate with dealers or customers, increase sales, aid internal relations or boost fund-raising efforts.
The Newsletter Clearinghouse in Rhinebeck, N.Y., says companies and organizations publish as many as 4,000 professional newsletters with paid subscriptions in the United States. That does not include the tens of thousands of newsletters companies publish free for their customers, which the clearinghouse does not count.
The numbers are growing, for three good reasons:
*Newsletters are good business. A regular newsletter keeps a company's name in view of clients and prospects. A good newsletter establishes a leadership position and demonstrates expertise in a particular industry.
*Technological advancements in desktop publishing have made it faster and cheaper for companies to produce slick publications themselves. With a personal computer, page layout and word-processing software packages, creative business people can become publishers.
*Publishing a newsletter can be more cost-effective than conventional advertising.
The McCormick/Schilling division of McCormick & Co., the specialty foods and spice giant in Hunt Valley, uses a newsletter to inform consumers about the use of flavorings. In the process, it indirectly sells its products.
But McCormick & Co. has also found that its newsletter can help the company test new products and conduct market research.
Spice 'Xpress is published three to four times a year by McCormick & Co.'s consumer affairs department. About 70,000 names are on the Spice 'Xpress mailing list. Accompanying the newsletter periodically in the mail are samples of new McCormick/Schilling products.
Polly Murray, McCormick & Co.'s manager of consumer affairs, said the company mailed a new sauce blend in a trial-size package with the last newsletter. McCormick/Schilling plans to introduce the sauce blend later this year.
"We knew when the newsletters hit because our phones started ringing off the wall. Customers were saying, "We can't wait for this to come out in the fall!" Ms. Murray said.
When a questionnaire is attached, Spice 'Xpress becomes an informal market research tool. A recent questionnaire mailed with the newsletter generated a huge response.
"We got probably 10,000 responses from consumers," Ms. Murray said. "They told us what they liked about the newsletter -- they love the new products section. They also told us how big their families were and how old they were. Responses were all over the board."
Spice 'Xpress also helps McCormick gain positive media exposure. Ms. Murray said the newsletter is mailed to food editors and other media representatives, who often use its information in their columns.
Small companies, too, can reap big rewards from newsletters used as marketing tools. With a newsletter, a small business can deliver its message at a reasonable cost to its targeted audience. The cost is less than an ad, and there is no wasted circulation.
Nevertheless, creating a newsletter that customers appreciate requires a commitment from upper management. It also takes time to get started. Writing stories, collecting graphics and printing the newsletter are just part of the publishing process.
The first step is planning. Who gets the newsletter? The list should include employees, existing and potential customers, sales representatives, distributors, editors of appropriate business or trade publications, and influential friends and colleagues.
Once the readership is defined, the mailing list has to be developed and regularly checked to keep the addresses current. A newsletter has little value if the target never receives it. Postage, even bulk rate, adds up.
Ms. Murray said McCormick published an 800 number several years ago to start building its mailing list for Spice 'Xpress. Now with 70,000 names, the list, she said, is manageable, but probably will not grow much larger.
After the mailing list has been