Self Help Zone. Inc. was founded to capitalize on the opportunity for on-line
Self Help Audio, Video and Book retailing. The Company believes that the
Self Help industry is particularly suited to on-line retailing for many
compelling reasons. Self Help Zone.com has virtually unlimited on-line shelf
space and can offer customers a vast selection through an efficient search
and retrieval interface. By Selling streaming versions of Audio and Video
programs and electronic versions of Books, Self Help can offer an
extraordinary number of different items. This extraordinary amount of
programs available precludes even the largest physical bookstore from
economically stocking more than a small minority of available titles. In
addition, by serving a large and global market through on-line Streaming
distribution, Self Help Zone.com can realize significant structural cost
advantages relative to traditional booksellers.
Self Help Zone’s Streaming on demand audio and video sales also allows
consumers instant access to programs of interest without the need for the
Company to ship or warehouse products. Furthermore, unlike with clothing or
other personal products, consumers can make educated purchase decisions
using on-line information. Self Help programs can be intelligently selected
through on-line articles, excerpts and reviews. In addition, the demographic
overlap between frequent Self Help program buyers and Internet users is
high. Further, Self Help Zone.com promises significant benefits for Speakers
and Authors because Internet distribution is believed to greatly reduce
product returns and because consumer preference information can be
efficiently captured and utilized to create new programs.
The Industry:
The Internet is an increasingly significant global medium for communications,
content and on-line commerce. International Data Corporation (“IDC”)
estimates that the number of Web users grew to approximately 163 million in
2000. Growth in Internet usage has been fueled by a number of factors,
including advances in the performance and speed of personal computers and
modems, improvements in network infrastructure, easier and cheaper access
to the Internet and increased awareness. The increasing functionality,
accessibility and overall usage of the Internet has made them an attractive
commercial medium. The Internet is evolving into a unique sales and
marketing channel, just as retail stores, mail-order catalogs and television
shopping have done. The minimal cost to publish on the Web, the ability to
reach and serve a large and global group of customers electronically from a
central location, and the potential for personalized low-cost customer
interaction provide additional economic benefits for Self Help Zone, Inc.
Unlike traditional retail channels, Self Help Zone does not have the
burdensome costs of managing and maintaining a significant retail store
infrastructure or the continuous printing and mailing costs of catalog
marketing. Because of these advantages over traditional retailers, Self Help
Zone has the potential to build large, global customer bases quickly and to
achieve superior economic returns over the long term.
Traditional Self Help Industry:
The worldwide Self Help book and tape industry is large, growing and
relatively fragmented. According to Euromonitor, U.S. Self Help book sales
are expected to grow to approximately $25 billion in 2000, while worldwide
book sales will be approximately $70 billion by the end of 2000. Several
characteristics of the traditional Self Help industry have created inefficiencies
for all participants. Physical store-based book retailers must make significant
investments in inventory, real estate and personnel for each retail location.
This capital and real estate intensive business model, among other things,
limits the amount of inventory that can be economically carried in any
location. The average superstore stocks less than 10% of the Self Help
books believed to be in print, which limits customer selection and available
retail shelf space for the majority of published titles. Finally, publishers and
traditional book retailers cannot easily obtain demographic and behavioral
data about customers, limiting opportunities for direct marketing and
personalized services. |
