The company's new Web site, NewsPage, features "relevance-based advertising," sponsorship positions that tie a marketer to related editorial material. Users seeking articles on database software, for example, are also provided a direct hypertext link to the Web site of software marketer Sybase.
Individual Inc.'s First! and HeadsUp customized news services rely solely on subscriber fees.
"This is a total flip of our [existing business] model, which is 100% subscriber fee-based," said John Zahner, VP-business development and a co-founder of the six-year-old company.
NewsPage (http://www.newspage.com) was designed by CKS Interactive, Cupertino, Calif. The site taps into Individual, Inc.'s database of more than 500 sources, including daily newspapers, wire services, magazines and newsletters. The service filters through about 15,000 stories a day and presents customized news to subscribers based on their preferred topics.
Selling sponsorships will significantly reduce the fees charged to subscribers, Mr. Zahner said. Burlington, Mass.-based Individual Inc. now pulls in some $20 million a year in subscriber fees from its services.
HeadsUp, for example, costs $500 a year. That allows users to access a one-page daily news summary based on 10 target topics and to download the full text of 160 articles a year. First! is sold to corporations, which pay as much as $10,000 to $15,000 a year for the service.
In contrast, NewsPage will be free to users during a four-month trial that begins this month. Sponsors are paying $15,000 each to participate in the test.
Seven business-to-business marketers have already agreed to participate in the test, including Silicon Graphics, Sybase, two units of Sun Microsystems, Digital Equipment Corp., Electric Power Research Institute and Knight-Ridder. Each will have sponsorship banners in four related editorial areas. Users who click on the logos will be linked to the marketers' Web sites.
"We looked upon the whole online services medium as changing the face of sales and marketing communications," said Geoff Beard, marketing manager at Sybase. "NewsPage will expose Sybase to a very targeted set of prospects that we can market to through the investment we've already made in our Web site."
Individual Inc.'s goal is to sign 20 sponsors for the trial. And while the initial participants are primarily high-tech marketers, other target categories include healthcare, automotive, aerospace and communications.
After the four-month test, NewsPage users will still be able to access news summaries at no cost but will be charged a small fee for the full text of stories. Advertising rates may also be revamped so that marketers are charged based on how many users access their sites.
Mr. Zahner said NewsPage ads will eliminate waste by reaching only users interested in related topics.
"In the media mix, there's a lot of fringe stuff, and to the extent you can offer the marketer a rifle shot to his core market, I think you've got a winner," he said. "Our big challenge is to get significant numbers of their customers and prospects to come and read this thing."
Toward that end, Individual Inc. plans to promote its Web site through a mix of traditional and interactive media. It is working with new-media ad agency OnRamp, New York, to develop online promotions and links with popular Web sites; it has already forged an alliance that links NewsPage to Netscape Communications Corp.'s home page.
NewsPage also will be promoted through full-page ads in newspapers and magazines, including Wired. The agency is Harpell/Martins, Concordia, Mass.