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NYT's Green Dimes Targets Junk Mail

NYT's Green Dimes Targets Junk Mail

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Published by: LauraNovak on Dec 09, 2009
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12/8/09 1:20 PMFor-Profit Crusade Against Junk Mail - New York TimesPage 1 of 4http://www.nytimes.com/2007/09/06/business/smallbusiness/06sbiz.html?ref=smallbusiness
Business All NYT
Small Business
For-Profit Crusade AgainstJunk Mail
Peter DaSilva for The New York Times
Pankaj Shah started GreenDimes last year to stop junk mail while aiding theenvironment.By LAURA NOVAKPublished: September 6, 2007
Correction Appended
P ALO ALTO, Calif. — PankajShah may be the only chief executive inSilicon Valley striv ing toput himself out of business. He is the founder of GreenDimes, a small business with big plans tostop junk mail while aiding the environment. If Mr. Shah has his way, millions of tons of unwanted mail will go the way of pesky phone solicitations. And the planet, not just consumers, he says, willreap the rewards.GreenDimes is one of several companies nationwide begun in recent years to organize information about a customer’s unsolicited creditcard offers and money mailers, or no longer desired catalogs, andthen perform the legwork to halt the flow.TheDirect Marketing Association, a trade group of 3,600 direct marketers and mailorder companies, reports that marketers will spend nearly $56 billion on direct mail andcatalogs in 2007, which will generate an estimated $700 billion in sales. That translatesinto an average of 26 pieces of mail a week for each household, according to the UnitedStates Postal Service’s Household Diary of 2006.“Everybody gets junk mail, and nobody likes it,” Mr. Shah said.The company pledges to plant one tree a month for every person who registers. 
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12/8/09 1:20 PMFor-Profit Crusade Against Junk Mail - New York TimesPage 2 of 4http://www.nytimes.com/2007/09/06/business/smallbusiness/06sbiz.html?ref=smallbusiness
 According to the WildWest Institute, an estimated 100 million trees are destroyed each year to produce 4.5 million tons of junk mail, with 44 percent of that thrown away unopened.GreenDimes keeps a crawl running on its home page, www.greendimes.com, showingthat more than 310,590 trees have been preserved, more than 4 million gallons of watersaved and nearly 1.6 million pounds of junk mail stopped by its efforts.Mr. Shah, 34, decided to “chase lifestyle dollars instead of charity dollars” when heopened a parent company named Tonic in August 2006 using wealth he had acquired inthe technology industry. He kicked off GreenDimes as Tonic’s first endeavor with only himself as a client when he found a stunning amount of junk inside his mailbox.Today, GreenDimes has 16 employees who manage accounts for 50,000 members. Many of them signed up after the actor Matt Damon, who sits on the board, promoted the siteon “TheEllen DeGeneresShow” and “TheOprah Winfrey Show.” In August, the company retooled the Web site to attract a hipper audience by includingmore content on environmental matters in a section called W.T.F.? (It stands for Wantthe Facts?) The company expanded its charity choices beyond just environmentalmatters and has started a petition to create a national do-not-mail list similar to the do-not-call list created by an act of Congress in 2003. The Federal Trade Commission, which administers the list, reports that 148,471,508 phone numbers were signed up as of  Aug. 31. As many as 300,000 are added weekly, the commission says.Mr. Shah hopes to get enough signatures through word of mouth to take his petition toCongress. But staff members of the Senate Commerce Committee point out that junk mail was left out of the 2003 provision because it was considered less intrusive thanphone calls or unwanted faxes. They further expressed doubt that a do-not-mail list would be created or would be upheld by the courts.But hurdles have not stopped Mr. Shah from, as he calls it, “stepping on the gas,” tomake GreenDimes more accessible and more competitive. The company — the name was based on the annual $36 fee, which amounts to a dime a day to stop junk mail —recently dropped its fee to $15 with a $5 rebate for referrals.The price decrease was in part a response to other small businesses also promising tostem the tide of waste while contributing to environmental causes.Last summer, three brothers in Ferndale, Mich., started 41 Pounds ( www.41pounds.org),named for the number of pounds of junk mail the average adult receives every year. Sofar, 5,000 people have paid $41 for a five-year membership. The company, whichrecently became a nonprofit organization, donates $15 of that to environmentalorganizations.The Web site,Stopthejunkmail.com, has 6,000 members and is run by a married couplein Boulder, Colo. It is the only company to provide the service to small businesses. Feesrange from $19.95 for an individual up to $90 for a business with 25 employees. Forevery sign-up, Stopthejunkmail.com donates $1 to American Forests, a nonprofitconservation organization.It is also possible to combat junk mail free. Web sites like www.ecocycle.organd www.obviously.com/junkmailwill walk you through the necessary steps on how to deal with list brokers and other direct marketing firms that are not part of the DirectMarketing Association.
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12/8/09 1:20 PMFor-Profit Crusade Against Junk Mail - New York TimesPage 3 of 4http://www.nytimes.com/2007/09/06/business/smallbusiness/06sbiz.html?ref=smallbusiness
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For $1, you can also get off any new customer lists through the mail preferences of theDirect Marketing Association (The-DMA.org). The association says it accepts post cards,available from many third party organizations, that consumers can individually sign andsend in with their $1. It is also in discussions with GreenDimes to accept theregistrations of their individual members.“To use an analogy, you can wash your own car or pay someone to wash it at a carwash,”said Stephanie Hendricks, director for public affairs at the association. “These companiesare certainly complementary, doing things you can do. You’re paying for time andconvenience.”Mr. Shah is gambling that a user-friendly process coupled with a charitable ethos willattract more users around the globe. Tudor Investment, a venture capital firm based inBoston, recently invested $20.5 million in GreenDimes, according to Mr. Shah. Tudordeclined to comment.GreenDimes has completed a test for expanding to Canada and plans to offer its servicein Britain as early as this fall.Despite these expansion plans, Mr. Shah says he sees no reason junk mail cannot beeradicated by more than the 75 percent to 90 percent most companies promise, even if that means the end of a small business like GreenDimes.“I don’t want this to be a small bet, meaning getting a few hundred thousand peoplesigned up by next year,” Mr. Shah said. “I’d rather figure out how to get five million andmake it viral and a little bit renegade. We actually are going to try to put ourselves out of  business because the win in the end is that people actually have to ask for this stuff instead of getting it thrown at them.”
Correction: September 8, 2007 
 An article in Business Day on Thursday about companies that are trying to stop junk mail referred incorrectly to the business plans of two of those companies,Stopthejunkmail.com and GreenDimes. The two held no serious discussions about apurchase of Stopthejunkmail.com by GreenDimes.
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