Interview with Doug Colbeck, CEO of Trails.com

Trails.com is an online subscription service for consumers that enables them to find information on the outdoors, specifically hiking and biking trails across North America. Our services cover the United States, Canada, and parts of Mexico and the Caribean. We continue to expand outside of these areas as well.

The company also runs the site AllGetaways.com, which is based upon a similar concept of providing detailed itineraries for people looking to do more localized travel like weekend getaways, scenic drives, day trips, etc. These are our two properties that we currently run and we continue to explore other expansion opportunities for subscription-based services that provide value add content.

That is correct. They are both premium subscription services, although we do give away some information for free to show people the breadth and depth of our offering, and then full subscribers can access the full amount of information available. Most of our information is compiled from travel and outdoor guidebooks. We allow people to access that information in a unique way. In the past you would need to buy one guidebook for one or two hikes. On our site you can download information based upon your destination versus the entire guidebook.

Exactly, it is a lot more efficient and certainly more up-to-date than buying a guidebook that you may only use once or twice. Users can access, view and print the information they need to have a great time on their trip.

Early on we made a smart decision not to write the content ourselves but instead to partner with people that already had the content. For the most part, then and now we’re guidebook publishers. We forged quite a few partnerships with both large and small publishers and made that information available online through our service.

We were able to acquire and aggregate enough content by the second year for substantial coverage of the entire country for our core activities. At that time, we decided to switch over to an annual subscription service with one annual fee that enabled customers to access as much content as they wish. We started the business originally by charging customers for each download they pulled from the site. Originally, it was very similar to how Apple’s iTunes works, where customers pay per song. Our model charged customers for each trail they downloaded. We had to have the content available fairly quickly, otherwise people wouldn’t pay to access our site.

We did it for a few reasons. Primarily, it provided a more viable financial model and it was a much more convenient way for people to access our content. Customers are no longer required to complete a transaction in order to receive the content they are interested in. They simply pay once and can access all the content they want by simply logging into the site.

Some people did prefer did prefer the pay per download model and I can certainly understand that. We have received a very positive response from people who have really enjoyed the convenience of having access to all our information with once simple subscription. The numbers tell the story pretty clearly. It was a big turning point in our company’s history when we offered the subscription versus the pay per download.

You hear a lot about Apple iTunes and how great they are, but I guarantee you that they will offer a subscription service before too long. I also think that offering that type of solution will also make it a more profitable service.

They are definitely different markets. For one, our market is much more niche than Apple iTunes. People listen to music all the time and it is a mainstream activity for all ages. We really needed to have people make a commitment to our service and we felt that an annual subscription at a reasonable price was a way for us to meet their needs as well as our own. Our strategy may turn away some customers, but ultimately it is a much more viable model for us.

We have never been supported by advertising. One of our original goals in our 1999 Business Plan was to sell content. I came from a company called Corbis that has been very successful selling content online. Corbis sells access to digital photos, and I took that model with the idea of applying it to the outdoors. People thought we were crazy, because everything was supposed to be for free. Advertising was all the rage and people thought it was the only way to make money. That model failed until recently, with the resurgence of advertising as a whole.

I believe that we were one of the first companies to charge for content. I was very active in the Venture Capital community in the late 1990s and early 2000s and everyone thought we were crazy for even suggesting that people pay for the content.

We are really happy with how things have gone. Trails.com is doing well and continues to grow. AllGetaways.com launched this year and we expect it to grow as large as Trails.com or bigger. Our goal is to launch additional services that are based around lifestyle or affinity where premium content is available and can be aggregated online.

It is a balance of both. We have grown Trails.com incredibly this year and we don’t expect it to slow down for several more years. Our goal is to grow it five to ten times it current size before it might start to peak out. There is certainly a lot of opportunity with our current businesses, while we also see a lot of potential with leveraging our technology and expertise in expanding our model to many other areas.

We have worked to improve Trails.com over the last five years and have built a nice platform for managing subscribers, customer support, new registrations and accessing our content through a proprietary digital rights management service. We leveraged a lot of the software that we use for Trails.com and were able to launch the site fairly quickly.

Our goal is to open our organization up to a much larger audience with AllGetaways.com. Travel is much more mainstream than hiking or mountain biking. The average person is going on a lot more weekend trips, scenic drives, etc. than on a hike or going mountain biking. People that register for Trails.com, while being a very targeted base are also very passionate about what they do and are willing to spend money on these activities. We expect the conversion rates for the new service to be below Trails.com for many reasons, but that is the tradeoff of going after a much larger market.

The companies that publish the hiking books also publish quite a few travel guidebooks and we have partnered with them to offer the content online. We built the business plan in 2004, began development in late 2004 and launched it in the Spring of this year.

You definitely need to know what people are looking for in those areas. Our content is very specifically focused on the weekend getaways, day trips, etc. There are certain things that people are looking for within that category and we use all available channels to go after them directly. General market advertising is not something that we do.

Obviously, it is basically online. Although, we have tried all types of initiatives and even tried a retail product at one time. Most of our success has been attributed to our online efforts. Overall, though I would say that the key has been time. We are now into our sixth year and the word has gotten out. We have really focused on developing partnerships with different companies as well as expanding our search engine footprint, whether the placements are paid for free.

One thing that we have done this year is to partnership with a company called Sunbelt Snacks. They placed us on the back of 1 Million boxes that were distributed this Spring and Summer. This has driven a lot of new subscribers for us and we are very happy with how it has gone.

It was a natural fit. It is all part of a healthy lifestyle fit. Sunbelt Snacks wanted to work with a partner that could really help them establish credentials within the lifestyle market and we were able to help them do that. It is a cross-marketing opportunity, but we are open to revenue sharing, cost-per-lead and other opportunities if the partnership makes sense.

Our biggest competition is information that is freely available. That is why people thought we were crazy when we first started. In a free market, market forces drive people to find ways to monetize their content. Gorp.com has had to diversify their business because advertising can only do so much. Ultimately, we need to show customers that the information that we offer isn’t available anywhere else online. The key is to educate customers about our detailed information that is only available at Trails.com. Part of that strategy is to offer the Free Trial offer.

Being a relatively small company, it?s important to find employees that are self starters and willing to wear multiple hats. It?s nice to find people with lots of experience, but I?m just as interested in a potential employee?s aptitude. Someone that possesses the capacity to learn quickly while on the job is more valuable than someone that comes with a lot of experience but can?t evolve with the company as it grows. I also look for people that work well in a team environment and fit in with the company?s culture.

Yes we are.