BY JOHN ECKBERG
The Cincinnati Enquirer
![[rosenthal]](/editions/1998/11/01/rosenthal_150x155.jpg)
Richard Rosenthal, president and owner, relaxes among company archives.
(Saeh Hindash photo)
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First find a publishing niche, then hire some talented people and turn that niche into a Grand Canyon.
That is the success formula for F&W Publications, an Evanston-based empire of self-help books, correspondence courses and how-to manuals.
The firm has seen exponential growth in the past two decades, and its tried-and-true strategy is expected to continue to drive revenues into the Internet's information age, said Richard H. Rosenthal, F&W president and owner.
"Our success formula is to find a niche market -- writing, art and woodworking -- and surround that market with products and services that the market tells us that they want," Mr. Rosenthal said. "We are the source of authority for people who aspire to fulfill their avocation or hobby dreams.
"We have magazines. We have books. We have clubs. We have Web sites. We have correspondence in the writing and arts fields, and of growing importance in the graphic design field is the HOW Design conference. We plan to add a second conference in the graphic design field as well."
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ARTISTIC APPEAL
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A couple of critical events led F&W Publications to broaden its mission from how-to-write books and magazines. The first came in the 1950s when paint-by-number was popular, F&W President Dick Rosenthal says.
It did not hurt sales that President Dwight Eisenhower was a painter, either.
Company market studies show that Americans have an artistic bent:
About 14 million annually write and submit stories for publications at least once a year -- mostly letters to the editor of the local newspaper.
About 12 million people within the past 12 months have also drawn or painted something.
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The HOW conference invites the world's experts on graphic design -- from designing book jackets to fee structures -- for a 52-session, three-day event. About 2,000 attendees pay $795 a person. The next one will be in Dallas in May.
Company growth backs up the strategy of flooding a niche. From 29 employees and sales of about $4 million in 1978, the company grew to $28 million in sales and 160 employees by 1988 -- followed by a quantum leap to $65 million in revenues and 300 employees at the art-deco former Coca-Cola bottling plant in 1998.
Revenues come from books and magazines -- hundreds upon hundreds of books that are stacked on pallets seemingly halfway to the ceiling at the company's sprawling warehouse.
Sources of revenues might seem strange because of the unusual nature of the books that bring in the dollars: From Painting Animals on Rocks, which Mr. Rosenthal describes as a "fly-away best seller," to the 92,000 copies and five editions of The Crafts Supply Sourcebook, sold for $18.99 under the F&W nameplate Betterway Books.
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1997 BEST SELLERS
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F&W Publications' 20 best-selling books, with number of sales:
Writer's Market '98 159,000
Genealogist's Companion and Sourcebook 67,729
Art of Painting Animals on Rocks 43,734
Children's Market '97 34,110
Writer's Market '97 33,196
Painting and Decorating Birdhouses 32,470
Painting Houses, Cottages & Towns on Rocks 29,795
Novel and Short Story '97 29,127
Making Greeting Cards - Rubber Stamps 27,139 Poet's Market '98 24,821
How to Have a Big Wedding on a Small Budget (3rd) 23,248
Graphic Artist Guild Handbook (9th) 21,895
Artist's & Graphic Designer's Market '98 21,365
Photographer's Market '98 21,248
Guide to Literary Agents '97 20,560
How to Make Clay Characters 20,411
Creating Textures in Pen & Ink 20,309
Songwriter's Market '98 17,197
Capturing Light 16,562
How to Write and Sell a 1st Novel 16,168
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A central library holds scores of other titles: The Splendor of Light, How to Make Money with Your Airbrush, How to Draw and Sell Comic Strips, Creating Family Newsletters, How to Write Romances, 611 Ways to Do More in a Day, How to Make $40,000 a Year With Your Woodworking . . . Making Miniature Flowers with Polymer Clay.
In all, the company publishes 125 new titles a year, has 750 titles in print and 900 titles from other publishers sold to book clubs. Another 450 titles are distributed to bookstores from other publishers. The Internet brings new opportunities, both through the F&W Web site and with online bookseller Amazon.com, he said.
Writer's Digest Books, North Light Books, Betterway Books, Popular Woodworking Books and Story Press are all under the F&W umbrella.
Company directories remain a revenue backbone: Photographer's Market, started in 1979; Poet's Market, started i 1986; Artist's Market, started in 1975; Writer's Market, started in 1921; Songwriter's Market, started in 1980; and Fiction Writer's Market, started in 1983.
Mr. Rosenthal, whose grandfather Ed Rosenthal founded the company in 1910, came to work in June 1957 as marketing manager for Writer's Market. At the time, the book billed itself as offering a door to 4,000 markets. The publication today lists 8,000 editors, 1,000 markets for writers, 1,500 consumer magazines, 2,000 e-mail addresses and 2,000 Web sites as well as trade magazines, pay rates and submission guidelines.
It was a demanding job, he recounted. Because it was the company's flagship book at the time, he had to write three solicitation letters a week to consumers. The three-a-week dictum came from his boss at the time, the late Aron Mathew, F&W general manager, and it taught him the value of being aggressive and energetic.
"I'm not saying the policy was great. But the lesson was to hustle," he said.
The brisk pace led Mr. Rosenthal, 65, to take some unusual approaches. One idea involved an outline of a Mae West figure on a letter. Inside was text appealing to the prospective buyer. The pitch was a play on the starlet's Come-on-up-and-see-me-sometime act. He sprinkled perfume on the letters and shipped them off.
It bombed, but the president-to-be learned a valuable lesson: You never know whether a sales strategy works until you try it out.
Much of the company's growth comes from acquisitions. The firm earlier this month bought I.D., a trade magazine circulated to 27,000 subscribers eight times a year, for an undisclosed price. For $40 annually, the publication offers news about designers, graphics, and interior and exterior design.
With revenues of $3 million, which includes advertising sales of $1 million, the publication will be a natural fit with two other graphics magazines associated with F&W -- HOW and Print.
Two newly acquired book clubs from Rodale Press -- The Successful Sewing Book Club and the I Love Quilting Book Club -- will join five other book clubs owned by F&W. Combined revenues of the sewing and quilting clubs are about $1 million annually.
"They have figured out how to run book clubs profitably," said Kitty Morgan, editor of Cincinnati Magazine and former director of new product development for F&W. "The important thing is the synergy that builds between titles, clubs, books from other publishers and the magazines. It is the same audience, and you're selling different products to them."
Developing or hiring staff expertise is another hallmark of the organization, she said. It was not unusual for the firm to send editors to Florida, for instance, to take painting lessons. "Editors themselves learn the skills," she said.
The skyrocketing revenue growth might one day slow, but it is not expected to stop any time soon.
"There are opportunities to develop and acquire properties related to what we do and new areas that are a little bit of a stretch of how-to," Mr. Rosenthal said. "For instance, we have plans for a family history magazine.
"One of the areas where we are finding a good deal of success is genealogy. It is becoming an extremely popular hobby. We are having significant sales in our genealogy books and see an opportunity for a magazine in that field -- a popularized handling of the subject rather than just pure research."
In the basement, the company has a full wood shop so projects can be photographed at each stage of development. Cabinetry created in the shop is auctioned to employees with proceeds to charity. Though the company dominates the book and magazine how-to market, don't look for F&W to move into other media. Mr. Rosenthal never looks at the Home and Garden channel, despite its national popularity.
"I don't have cable (TV)," he said. "I'm not proud of that, but it would screw up the ceiling in our house to put it in."
Non-fiction publishers are sharpening marketing skills to survive against bigger publishers with deeper pockets, said Jim Milliot, business news editor for Publishers Weekly, an industry trade magazine circulated to 40,000 book sellers, publishers and agents.
"Publishers are trying to bring more marketing savvy to the business and trying to get a better idea of how to target their titles to specific markets," Mr. Milliot said. "For a small publisher like F&W to survive, they have to specialize in niches and figure out how to exploit their niches."
He said major New York publishing houses have not traditionally honed in on the self-help book market because those firms look to mass-market books.
"Usually, the way niche publishers start is with a magazine that morphs into a bigger company," Mr. Milliot said. "It's somebody somewhere having a familiarity with a market that the boys in New York don't see from their towers on the Hudson (River)."
Rather than producing television programming for art, writing, home projects or arts and crafts, the company has stitched itself to the coattails of others, like the how-to-paint television show by the late Bob Ross. F&W plans to publish a magazine called Joy of Painting based on the Bob Ross series on the joy of painting.
From marketing manager in the late 1950s, Mr. Rosenthal moved to a variety of other positions. He worked in payroll, in sales, in accounting and production. There are two areas where he has not had hands-on experience: he has never run the typesetter, and nobody lets him run a forklift.
Following a personnel brush with disaster in the 1970s -- workers threatened to unionize -- Mr. Rosenthal shifted the human resources focus of the company. An exercise room was added. Workers are now permitted to share jobs, work from home or have flexible schedules.
Another unusual effort is an annual garage sale after Thanksgiving. This year, it will be Dec. 4 and 5. Bays are thrown open to the public, and books that retail for $35 can be purchased for a fraction of the cost. The thrust is not to boost revenues, though.
"It gives our people a great opportunity to rub shoulders with the customers. To see what they look like and what are their needs," Mr. Rosenthal said.
The company has not seen growth without competition. When the firm felt it was threatened a few years ago, executives plotted on a chart the relative strength and positioning of the competition.
"We saw that we were in a cluster with everybody else and that over here someplace was an opportunity to be distinct," Mr. Rosenthal said. "That particular place was projects. Do lots and lots of projects, primarily for the intermediate-level woodworkers. "And serve them up in a way that was very, very step-by-step practical."
It apparently worked. The company remains a how-to leader. A similar strategy was developed for HOW Magazine in graphic design. The company differentiated itself by establishing a design conference and by focusing on the business of graphics -- a niche that no company had locked up.
F&W executives look overseas to the Pacific Rim, to Great Britain and to Europe for increased sales. The firm is already finding willing buyers. The key to this Queen City self-help empire might not be as complicated as market differentiation and niche exploitation might imply.
Americans work all week, and on the weekend, they want to take on a project, to forget about those vocational stresses.
F&W publications offer an escape.
"It's a meditative way to get away," Mr. Rosenthal said.
And nobody sees that need evaporating tomorrow.
![[rosenthal]](/editions/1998/11/01/rosenthal_485x500.jpg)