Getting It Done

LifeMinders: Doing It By the Numbers

"Where's your hypothesis? Where's your data? Where's your proof?" It's 10 am at LifeMinders Inc., a Web-based reminder service based in Hernon, Virginia, and co-founder Steve Chapin is in full laboratory-scientist mode. For the past hour, Chapin, 37, has been arguing with his creative team over what to title the subject of a new marketing email that will go out to the company's more than 12 million subscribers. It's a big deal; in a way, it's what the whole business turns on. Founded in March 1999, LifeMinders reminds subscribers about everything from birthdays and anniversaries to the release date of a new CD by sending them an email, in which the company includes paid advertisements.

Which is why the company's performance can depend on a single email subject line. The subject must sound appealing, or subscribers will hit "delete" instead of "open." In their search for the perfect subject line, Chapin's people have been trying to top one another with their best material. At first, Chapin watches the process like a patient professor. But then he interrupts to ask whether anyone has actually confirmed these great ideas with data. Heads shake, and Chapin sends the team members back to their PCs. "Test, test, test," chants cofounder John Chapin, 34, Steve's brother. "A person with an idea and no data is just another ... " He pauses and smiles. "Well, just another person with an opinion."

If fast implementation is the name of the game, the folks at LifeMinders believe that they've found a precision formula -- a business version of the scientific method used in research laboratories. Like scientists, the Chapin brothers and their 150 colleagues work not by "feel" or "gut instinct" but by testing cold, hard data. Every idea, no matter how brilliant it may seem, must first be turned into a hypothesis and then tested on a small customer segment. If the data comes back positive, then the idea can be unleashed on the rest of the world. "Our approach to the world is iterative," explains Steve Chapin. "Build, learn. Build, learn."

Better still, the Chapin brothers have found a way to instill their method with a kind of thrilling urgency. Using everything from weekly pep talks to strict deadlines -- no project can take more than three weeks to complete -- LifeMinders has managed a surprising number of successes in its first year, including a near-flawless series of launches, a $60 million ipo in November 1999 (and a follow-up offering in February that drew $87 million), and revenues that exceeded analysts' predictions by 70%.

On the surface, a scientific business model might seem to be a bizarre approach for the breakneck, seat-of-the-pants world of e-commerce. Yet it's perfectly suited to the LifeMinders product -- a service that never forgets. Customers sign up at the company Web site, fill out a profile, and then receive email messages reminding them of key dates, plus customized information on goods and services. But it all comes back to designing email that is useful and appealing, which is where the science comes in. Using Web technology, LifeMinders not only tests emails before sending them en masse, but the company also continues to gauge the success of email after it has been sent out. The company knows, for example, precisely which messages are opened and by whom. That kind of feedback guides employees in creating their next wave of messages.

Both Chapins are veterans of exacting methodology. John was a systems engineer at consulting giant Electronic Data Systems; Steve, a Naval Academy graduate and a Harvard mba, managed credit-card databases at First usa. But LifeMinders has allowed the two of them to turn rigorous testing methodology into an organi-zational model. Indeed, from the minute that new hires walk into the building, they hear the mantra of "test" at every turn. At meetings, ideas and hunches are automatically framed in terms of testable hypotheses. "One of the first things that people have to learn to do here is how to think of everything in terms of hypothesizing," says Steve Chapin. "You have a great idea. Now, how can you test it?"

After a hypothesis has been framed, and a test has been run, everyone focuses relentlessly on results. At LifeMinders, all kinds of data are openly displayed on huge sheets of paper hanging from office walls. "When I first arrived at LifeMinders, I couldn't believe they left that kind of information in plain view," says Tim Hanlon, 42, former senior vp of marketing and communication, who left LifeMinders in February to do consulting work. "But that's the point: To see how the company is doing, you need input from everyone."