The Ultimate Class Project
How two students saw an opportunity to corner a market by providing companies with targeted marketing and delivering utility to students.
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Join us at Entrepreneur magazine's Growth Conference, Dec. 15 in Long Beach, Calif. for a day of fresh ideas, business mentoring and networking. Register here for exclusive pricing, available only for a limited time.Daniel Martz and Avi Steinberg of All By Students Notebooks read many case studies as MBA students at Northwestern University's Kellogg School of Management. Little did they know that future students might be reading a case study about them--and how they created a business as a class project that was a triple win: for college students, school administrators and businesses that want to reach them.
In 2006, Martz and Steinberg noticed many brand-sponsored promotional items like key chains, cup holders and lanyards being given to students. They thought there might be a way to better channel all of the advertising and promotional dollars businesses were spending to reach these students into products that would actually be used by students, save the students dollars and also provide more impactful exposure for the brands. They decided to offer students notebooks as a promotional giveaway. In 2007 Martz and Steinberg gave out their first notebooks to 10,000 students at Northwestern. This August and September, ABS Notebooks will deliver a multi-subject notebook, at no cost, to 1.5 million college students at 175 campuses across the U.S.
This couldn't come at a better time. According to the annual National Retail Foundation Back-to-College Survey released on July 14, college students are feeling the effects of the economy, and many are making do with last year's school items.
The notebooks are branded for each school and contain full-page advertisements and promotions from businesses that offer products and services to college students. They also provide students with a school resource guide with campus maps, athletic schedules, key contact information, important dates, etc., and hundreds of note-taking pages--enough for a semester's worth of notes for all classes.
As part of the program, students receive product samples, valuable discounts and other promotions from sponsors. For example, Boost Mobile has included a $10 off coupon for a pay-as-you-go phone purchased at Target, and Kotex provided a coupon redeemable for a discount on its products.
The key to the profitability of ABS was finding advertisers. But how would a small, unknown company attract big advertisers? At first they gave away advertising spots at no cost to prove how effective a marketing vehicle the notebooks were. From there, a third-party market research firm was hired to perform an independent assessment of the medium.
Martz and Steinberg had to determine advertising rates for this new medium, and decided to benchmark rates on various advertising and sponsorship media including: event marketing and out-of-home advertising on college campuses, college newspapers, TV, magazines and the internet. Ultimately, they also developed the price based on their observations on campus and insights garnered by the third-party research on how the books were being used and the number of impressions each notebook generated.
But what good is advertising if no one is there to view it? The founders hired two people to develop and manage college relationships. They travel around the country meeting with school administrators and sharing the ABS platform and vision. The key value proposition for the schools is that ABS offers them a section at the front of the notebook to provide a resource guide for the students--the information schools would typically include in a welcome week or orientation package.
This prime placement is offered to schools for free, which saves them money. For example, Arizona State University could spend 50 cents per student creating a resource guide for orientation and welcome week, but with ABS distributing 25,000 notebooks to ASU students, it costs the school nothing. ABS also develops relationships with college deans, who are always on the lookout for programs that deliver value to students. "I asked every student I spoke with whether they would use the notebook. They all said definitely," says Robert Doyle, the associate dean of Harvard College, who has struck a deal with ABS to provide students with complimentary multi-subject notebooks for the third time this fall.
The objective for the growth of ABS was to build a national platform, in order to attract the interest of large national brands. This required foresight on the part of Martz and Steinberg to invest in preliminary printing, which was used to execute the research, develop the deep relationships with the schools, grow the network and build a buzz about the program among students and schools on a national level.
Schools signed on with exclusivity agreements to stymie competitors. Employing that strategy early has paid off, ensuring ABS a cornered market of more than 200 campuses in 2010, in only its third year of operation, with a number of large national brands as clients. ABS has grown its revenue steadily every single semester.
Even in a down economy, ABS continues to grow. "There is a lot of apprehension to starting a business in this economy," Martz says. "The truth is that opportunities abound in down times since everyone is looking even harder for ways to optimize their efficiency, and increase the ROI of each decision they make."
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