Tom Phillips reflects on a legendary career in newsletter publishing. (Publisher Profile).

We recently caught up with one of the true legends in the newsletter business, Thomas L. Phillips, chairman of Phillips International Inc., former president of NEPA, and a member of both NEPAs and the Foundation's Halls of Fame.

"Newsletter publishing is still an entrepreneurial-driven business," Phillips said at the outset of our interview, "and you could begin in your garage as I did 30 years ago and succeed. But the odds against it are tremendously longer ... due mostly to the tremendous increase in competition in specialized information, print and electronic."

PII publishes in the consumer health and investment areas. Phillips also owns Regnery Publishing in the book business. "Believe me," Phillips said, "newsletters are lucrative, profitable and dependable in comparison to the roller coaster ride of the book publishing business."

Got out of b-to-b publishing

Phillips left business-to-business publishing in October 2000 with the sale of Phillips Business Information (FBI). "We had reached a gross of $110 million annually, but my judgment was that we needed to grow perhaps three times to be competitive with the Elseviers of the world, and I couldn't justify the investment or debt that would have been required. As it was, the exit timing was fairly fortuitous as FBI was very heavy in the telecom and internet markets, areas strongly affected by recent business conditions. After the sale of FBI, Phillips International now publishes 23 consumer newsletters with an annual gross revenue of $250 million.

Asked about the consumer newsletter business, Phillips said the health side is "very strong" and, on the investment newsletter front, he is "looking forward to 2004."

Print complemented by electronic

"'What I see in our business is an increasing trend toward print products complemented by electronic products and services in conjunction with the original print product. And the print product should be an established brand name with a well-known writer-editor. In our case, of course, it may be relevant that what we publish is 'point of view' and 'value added' materials, uusually in a monthly format-rather than 'news,"' Phillips said.

"The Newsletter & Electronic Publishers Association may be a fairly awkward mouthful, but I think it is representative of where the industry is going.

"We're finding that when we have a list of subscriber e-mail addresses along with fulfilling electronically, we can both sell and deliver reports and derivative products, as well as seek renewals."

Still doing print DM, but less so

Regarding print marketing, he said, "We still use formats like four-color magalogs of various sizes, and #10 packages can still work. We're mailing fewer pieces these days due to the state of the economy and the cost per piece is up ... leaving your window of opportunity for profits narrower than it used to be.

"It helps to be able to hit a home run once in a while."

People

"I still believe the most important thing in this business is people," Phillips said. "I'll mark my 30th anniversary in the business next January 1st, and Phillips is fortunate enough to have a number of employees who have spent more than 20 years here-Vanessa Henderson, John Farley, Dave Durham, my assistant Phyllis Merrill-as well as many others who spent a good portion of a 'career' here before moving on to other opportunites. (Mark Ziebarth, recently profiled in The Newsletter on Newsletters, was one)," Phillips said.

As far as the future goes, Tom Phillips observed, "When I was younger I think I expected, or at least hoped, that there would come a point, at least perhaps a week or two, where everything in which I was involved was going well at the same time. I'm old enough now to realize that life just isn't like that. There is always going to be some damned thing going wrong."