This is a nice package, with goodies from Guba, mingle and WebShots (along with a few others). All in all, a rather nice package.

They’ve thrown that all away now, sending the following notice to all the subscribers:

“We’d like you to be one of the first to know that we will soon unveil the Valleyschwag General Store, where you will be able to purchase future issues of our famous schwag bags. And by popular demand, we will be offering some of our most requested schwag items for sale.

This store replaces our subscription service, giving you more control over the issues and items you’d like to receive. We will notify you by email when a new issue of Valleyschwag is available, giving you the first opportunity to place an order at the General Store.

Since a subscription is no longer required we will automatically cancel your Paypal subscription if you haven’t already done so. To accomodate our members around the globe, the store will continue to accept Paypal as well as credit cards for all purchases.”

That’s right, they are now hoping that by sending out reminders and canceling the automatic payments, they will be able to stay afloat. They had guaranteed money in the bank every month, now, they’ll have to hope that people will remember to take time out of their busy day to buy the next issue. I don’t think they’ll see near the numbers they could with the subscription model.

One of the things I like about any subscription is that you don’t have to think about it, it just works. Once a month or so I get a package, no forms to fill out, no remembering to check and see if the next issue is ready, it’s just there. I think a lot of people feel this way, and I think this will be rather painful for the ValleySchwag team, and endanger the future of the business itself.

Valleyschwag was a really interesting concept, but I have to believe it grew too large, too quickly for the model to work. I wish the guys at RubyRed the best, but I believe the end is coming for the schwag express.

While a bit less loaded than last time , I’m still quite impressed with the package they’ve put together. The two big hits this time are the rather cool shirt from imeem and the laptop bag (see below) from MI6. While the bag doesn’t have the padding of my regular bag, it’s a lot lighter, so I know it’ll see some use.

All in all, I’m quite happy with this months package, and I’ll certainly be looking forward to the next round. For those interested, here’s a list of vendor’s that provided something cool for this months package:

• imeem – Mostly-cool t-shirt
• MI6 – The laptop bag pictured above.
• jeteye – A useful little pen (the clicky type, that are so useful for annoying those in near-by cubicles).
• Channel 9 – Microsoft’s Channel 9 provided a highly throw-able version of their mascot, Channel 9 Guy.
• Macromedia – A might-be-useful-someday key chain (bottom left corner of the picture above.
• There are also about 5 other companies that provided stickers.

I’ll admit, I was a bit unsure about this idea at first, but now that I’ve got my hands on this pile o’ goodies, I’m hooked. Not only is Valleyschwag a great marketing idea, but so far has proved to be a great service. Here’s a breakdown of the goodies:

• A very cool MovableType hat & key-chain/necklace thing.
• the signature Ruby Red t-shirt.
• A TypePad t-shirt. (Seems Six Apart really likes this schwag thing.)
• A pack of puzzle cards from PerplexCity.
• A pencil from LiveJournal.
• Stickers from: FeedBurner, EFF, and Goatse.
• A temporary tattoo from abazab.

For $14.99, this is a great deal, the hat alone made it worth it (the hat is definitely my favorite piece). Yeah, it’s official, I’m a fan.

Valleyschwag has shipped the second issue of their bundle o’ schwag to approximately 1,500 subscribers, up from 50 for the first issue. The growth is amazing, and so is the money involved. This month they should have seen somewhere around $21,500 in gross revenue. 

For a part-time project where you are just mailing out free stuff, $22,000 a month is not bad at all. There are of course a number of expenses, but this is what’s important: this is an innovative business model that really works. How well it would go in other industries, I don’t know, but after seeing the popularity of the Kings o’ Schwag, I’m sure we’ll see similar attempts in other industries.

A new twist on Viral Marketing 

I really like this concept, from both sides of the coin. For companies, they can supply these promotional items at minimal cost to a larger, more targeted audience. While for the end user, they pay a fairly minimal service fee to receive cool stuff. What could be better, free stuff & nearly free advertisement.

This allows for some really creative marketing, getting the brand out without wasting money on sending products to those that have no real interest is critical. With so much money wasted on typical give-aways, for many companies with a lower budget, such promotions aren’t an option. A service such as this is great for these smaller shops, it allows doors to be opened that otherwise would have gone untouched.

Let The Bribing Begin

Let’s face it, free stuff is great, and people love it. The $15 being charged is close enough to free for what you’re getting, at least one shirt, plus enough stickers to cover that ugly laptop.  In general, people are easily bribed, and when good companies with good products do the bribing, it works out great for all involved.

The Future of Marketing 

These companies realize something important, traditional forms of advertising aren’t that effective, and among the web crowd, even less so. To get your name out, you need to not only have a good product, but give users a reason to talk about your product. Word of mouth is the way to go, and with lower-budget Web 2.0-types seeking ways to build buzz, this provides an excellent opportunity.

The companies that donate these items receive not only more, but better press than they could buy. If this works well, expect to see copy-cats springing up in other industries. This is certainly an interesting idea and I can’t wait to see where it goes.

I’ll be keeping an eye on this, I’ll post again once I receive my first package.