On the Net

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Mr. Wunderman Goes to the Web If any doubts lingered about the legitimacy of the Internet as a direct marketing vehicle, they now have been washed away for good. Mr. Wunderman has come to the Web.

Intellipost Corp., the San Francisco-based provider of the MyPoints and BonusMail Internet marketing programs, announced last month that Lester Wunderman had joined its board of directors. Wunderman is credited with coining the term direct response marketing and is the founder of the nation’s largest direct agecy, Wunderman Cato Johnson. He is renowned as the architect of the American Express card and the Columbia Record Club, and is the author of Frontiers in Direct Marketing and the just-released Being Direct.

Wunderman, who is also involved in a startup e-commerce venture, says he was drawn to the Web because of its tremendous upside potential in direct marketing.

“My focus all along has been to try to get people to talk to each other, to get the consumer to talk to a supplier and vice versa. Clearly, the Web is bringing this to a new level,” Wunderman said in a telephone press conference following the Intellipost announcement.

“The problem with the other media is people have not accepted the idea of reading [a direct mail piece] or of being called on the telephone. Intellipost has the advantage of having people as members who have agreed to read.”

Indeed, Wunderman allowed that the Internet was more than a mere medium.

“I think the Web is a marketplace,” he said. “It’s a place where people can meet, it’s a place where people can transact . . . it’s an experience that is unmatched because you are in contact, but you really haven’t lost your privacy, despite what people say.”

According to Intellipost, a total of some two million consumers are registered in its BonusMail direct marketing program and its MyPoints loyalty rewards program. Its clients include GTE, NextCard Internet Visa, and Prodigy Services Corporation. Rewards offered to members range from frequent flyer miles to merchandise from online retailers including Barnes & Noble, Omaha Steaks, and Macy’s.

Intellipost also announced the appointment of new board members Larry Phillips, managing director of Primedia Ventures, and Tom Newkirk, chairman of direct technology and marketing solutions at Experian. Intellipost acquired MyPoints from Experian last year.

Serious Reservations Las Vegas-based Travelscape.com, an online discount hotel provider, has reached an exclusive agreement with Santa Clara, CA-based Yahoo to provide travel services on the latter’s Lodging area, says Travelscape vp-business development and marketing Steve Sarner.

The company is also poised to ink a major network deal with online advertising supplier DoubleClick that will make the service the featured travel provider for the majority of DoubleClick sites, Sarner says. New York City-based DoubleClick has an extensive stable of Web sites that will provide one-click transfers to Travelscape offers and special deals.

Travelscape has signed a letter of intent with Lorland.com, one of the biggest travel destination sites on the Web. Travelscape is already the “booking engine” for Lasvegas.com, which produces “$25,000 to $50,000 a day in revenue,” says Sarner. Lorland.com would utilize that booking system under terms of the deal, he says.

Elsewhere, Travelscape just announced a “No Risk Reservations Guarantee” under which it promises to refund the difference if customers don’t receive the lowest rates at hundreds of Travelscape.com preferred hotels, says Sarner. In addition, travelers gain greater flexibility by being able to change or cancel reservations up to 72 hours prior to arrival without incurring charges, he says.

That’s the Ticket In a bid to strengthen its entertainment services, America Online said it will acquire New York City-based MovieFone, Inc.,a Web film listing and ticketing service, in an all-stock transaction worth $388 million. MovieFone, which serves more than 100 million moviegoers annually, will help position AOL in the rapidly growing market for online entertainment. Special promotions “are likely” in the future to publicize the acquisition, says an AOL spokesperson.

AOL will use its online expertise to improve MovieFone’s Web site, which will be rebranded AOL MovieFone. The site will continue to provide moviegoers with a complete, free directory of movies, showtimes, and theater locations, while expanding its ability to facilitate ticket purchases on the Web and by telephone.

“MovieFone will add an exciting new area of local e-commerce to AOL and our other brands,” says Bob Pittman, ceo of Dulles, VA-based AOL. AOL is uniquely positioned to build MovieFone because of its Digital City site, “the No. 1 local content network on the Web,” he says.

MovieFone covers more than 17,000 movie screens in 42 cities around the country, representing more than 70 percent of the national movie audience. In addition, the service has advertising relationships with all of the major movie studios, as well as exclusive ticketing and on-screen ad agreements with leading theater chains.

MovieFone’s board of directors is voting in favor of the acquisition, and the Jarecki family and its affiliates, who control more than 90 percent of the company’s voting interest, have given their blessing.

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Virtual Wall Street The web’s highest-stakes contest is off and running. RealTime Media, Haverford, PA, teamed with Internet advertising network Flycast Communications, San Francisco, for Beat the Street, a promo offering a $20 million Wall Street cash account. The contest was being touted as the largest payout ever on the Web or off – until Publisher’s Clearinghouse unveiled a $31 million giveaway in December.

The promo, which debuted Jan. 11, is co-sponsored by CBS MarketWatch.com, Track Data Corp., Delta Air Lines, and Norwegian Cruise Lines.

To play, contestants log on to www.prizes.com and pick the week’s close of the Dow Jones Industrial Average as well as the week’s volume on the New York Stock Exchange (NYSE). A correct guess on both earns the $20 million, which is being insured by two prize indemnity companies, American Specialty Underwriters and SCA Promotions.

Flycast will support the promo with more than 15 million banner advertisements per month on the 600 Web sites that are part of its network.

“The game links the largest prize ever offered with one of the Net’s hottest categories – personal finance and the stock market,” says RealTime ceo Chuck Seidman.

Numerous other prizes will be awarded to contestants who correctly pick the NYSE volume and portions of the Dow’s close, including cash giveaways of $2 million, $200,000, and $20,000. Special vacation getaways will also be awarded to registered visitors of prizes.com, compliments of Delta Air Lines and Norwegian Cruise Lines.

Fun for a Girl and a Boy Milwaukee-based Alottafun, Inc. has launched a Web site for toys (www.alottafun.com) that will focus heavily on direct-to-consumer marketing efforts rather than simply relying on search engines to drive traffic.

In the U.S., toys are a $14 billion industry, notes ceo Michael Porter, adding, “Kids are becoming computer-literate at younger and younger ages. We are developing a site which will be technologically friendly to kids and fun-loving adults, provide links to other children-oriented sites, and provide a place to participate in the fun of collecting.”

Visitors to the site will have the opportunity to play various games and enter contests that will expose them to a greater range of products and drive higher rates of purchase, Porter says.

The site will showcase the company’s new line of collectible toys, introduce 120 new products, and feature Alottafun’s new Hearthside Treasures product line.

Dynamic Duo New York City-based Webstakes and Spree.com, Thornton, PA, have signed a one-year deal to grow the affiliate marketing programs and membership bases of both companies, officials say.

Through the agreement, Spree.com will extend specific offers and free services to Webstakes members via the latter’s Prize and Savings Club, Weekly Update, Webstakes Affiliate, and Tell-A-Friend programs, and offers with opt-in questions and product placements throughout the Webstakes site.

In addition to handling Spree.com’s online promotions, Webstakes will promote Spree Independent Partners and offer Webstakes members cash back on purchases from Spree.com. All Webstakes members will also be offered free home pages and other promotional resources from Spree.com, including the capability of building personalized online stores. In addition, through the Spree Independent Partners program, Webstakes members can earn commissions by referring people to Spree.com.

In a separate item, Webstakes reported that more than 35 million people have registered at its member-based site at www.webstakes.com. The 35-millionth registrant, Keith James, signed up Dec. 9, less than three months after Webstakes reached the 33 million mark. James received a Sony Portable CD Player as a prize.

More than 1 million people have become Webstakes members since January 1996, according to president Steven Krein. Webstakes has given away more than $750,000 in prizes, and now ranks 17th on the Web for the number of site segments visited per person, according to online research firm November Newsratings.

Sleuthing Shutterbugs Through Feb. 22, Rochester, NY-based Eastman Kodak Co. is hosting The Kodak Photo Mystery Sweepstakes, a contest developed in conjunction with Internet portal Yahoo, Santa Clara, CA. The contest combines a trivia game with online fact-finding that takes participants on a journey through the Kodak Web site (www.kodak.com). Players are asked to decipher a mystery by guessing the subject matter of an extreme close-up photograph. Answers are found by visiting different areas of the site.

The contest’s grand prize winner can choose either a Walt Disney World Swan or Dolphin resort vacation for four (including airfare, accommodations, free park passes, and $2,500 spending money), or $10,000 in cash. Participants can also win prizes such as an Advantix 4700ix zoom camera and a Kodak DC210 plus zoom digital camera by answering questions each week. The contest has nine rounds, with four new questions in each round.

“We worked closely with Yahoo to create a contest that would provide an engaging way for people to learn about photography and all that kodak.com has to offer,” says Tom Hoehn, Kodak Internet business development manager.

Cool Runnings Chicago-based Cool Savings has launched a customized Web site that will deliver special savings for customers of Hewlett-Packard, Palo Alto, CA. Using Coolsavings.com’s patented system for distributing targeted coupons, electronic certificates, and mail-in rebates via the Web, customers can receive savings on such HP products as Pavilion personal computers, inkjet printers, scanners, and photo paper.

In addition, the co-branded Cool Savings/HP Web site will offer savings on related technology products from Hewlett-Packard’s marketing partners, such as National Geographic software and Intuit’s QuickBooks, as well as rewards from online and off-line national retailers including JCPenney, Kmart, Kids R Us, and Chuck E. Cheese’s.

During the first half of 1999, HP customers will find an announcement for the Web site on special advertising inserts placed in more than 9 million inkjet cartridge packages in stores nationwide. Direct mail will support.

Once registered on the site, users can browse, download and print product and service rewards right from their PCs.

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Lee Has Des igns on Web New York- based Muffin-Head, newly acquired by DVC Interactive of Morristown, NJ, just inked a deal with Lee Jeans & Sportswear Riders Division, Merriam, KS, to set up a Web site for kids by the fall of 1999, according to MH president Hiam Ariav.

“We’re in the assessment stage,” Ariav says. “We’re going to use traditional offline marketing promos to get this online and drive traffic back to the stores.”

Lee has hired Muffin-Head to create a marketing strategy and assessment, a project that should take about two months. Next will follow the actual construction of the Web site, which should be “awesome . . . the hottest kids’ jeans site on the Web,” Ariav boasts. He adds that it was Muffin-Head’s “first big project” since the merger with DVCI and called it “a great opportunity.”

Muffin-Head also just launched a new site for JVC, which sells high-tech consumer electronics. Speaking of the merger, Ariav says, “We’re now able to offer better and more extensive services to our efforts. We were more a design boutique, but we’re now a full interactive marketing and promotion agency.”

Can The Spam, Thanks Taking swift action against e-mail spamming, the new Internet Direct Marketing Bureau (IDMB), Los Angeles, has become the first association serving the industry to endorse “opt-in” as the best method of e-mail marketing. The policy standard was announced during the inaugural IDMB meeting held in November at the E-Biz Solutions conference in Scottsdale, AZ.

IDMB called on all e-mail marketers and industry groups to endorse opt-in – which requires users to check a box requesting information about a particular product or service before they receive any e-mails – as a best practice. Many sites currently require visitors to “opt out” of receiving e-mail by un-checking a box. Otherwise their names are added to a particular list without their direct permission. That’s why spam campaigns that blitz unsuspecting Internet users with electronic junk mail are still prevalent.

“Our members are Internet-based companies, so they understand that a viable business model for direct marketing in this medium must respect the privacy needs of consumers,” says Sherman Oaks, CA-based Word of Net ceo Paul Grand, head of IDMB’s steering committee. “If our industry fails to voluntarily adopt these practices, we risk over-regulation by government.”

“Spamming under an opt-out model is the mark of a company that doesn’t care how many people it annoys, and doesn’t have a brand it needs to protect,” says Alexandria, VA-based Junkbusters Corp. president Jason Catlett. “One hundred percent opt-in is the only ecologically sustainable policy for the Internet.”

IDMB’s members include: InterActive Agency, Webstakes, market- reach, WebPromote, Think New Ideas, Pixelpark, Netcreations, Engage Technologies, Flycast Communications, and Dave’s World.

Fluid Strategy The Perrier Group of North America has named OgilvyInteractive, New York City, as its online agency of record. Ogilvy will be charged with coordinating all promotions and marketing efforts for retailers, distributors, restaurants, and consumers, and developing a Web site slated to debut in spring 1999.

Other agencies considered by Perrier included Think New Ideas, New York City, and Strategic Interactive Group, ISL Consulting, Novo/Iron Light and Red Dot Interactive, all from San Francisco.

Perrier also named Paul Bova to the new post of manager, interactive business development, which makes him responsible for the interactive presence of the multiple bottled water brands within The Perrier Group. OgilvyInteractive plans to devise a unified Web strategy for all 14 of Perrier’s brands.

Unstoppable Format Platinum Entertainment Inc., Downers Grove, IL, and Music Connection, Reston, VA, just completed a major promotion that allowed free Internet downloads of new songs by Taylor Dayne, Dionne Warwick, The Band with Eric Clapton, and Ronna.

The free downloads of Dayne’s new single “Unstoppable,” Warwick’s newly recorded version of the Bacharach-David classic, “I Say A Little Prayer,” The B and’s “Last Train to Memphis,” and Ronna’s “13 Days of Daisey” were used to support Platinum’s push to release the new songs in the controversial new MP3 format. (Record companies are vehemently opposed to MP3, which they claim encourages copyright infringement.)

The two companies said in a statement that digital downloading enables music lovers to create custom CDs (if they have a CD-recordable device). The Web’s largest custom music compilation site, www.musicmaker.com, owned by the Music Connection, is offering more than 175,000 songs in genres ranging from classic and alternative rock to blues, jazz, gospel, and classical.

“New song titles are being added as quickly as they can be converted to Liquid Tracks,” said Music Connection Chairman Robert Bernardi. He added that Platinum’s full catalog of more than 13,000 songs became accessible Jan. 1.

Steve Devick, Platinum president and ceo, says, “Consumers are starting to understand the benefits of creating their own custom CD compilations.” Downloads from the Web “will continue to grow as a profitable distribution channel,” he adds.

They are already proving beneficial for Platinum: the number of visitors to the site skyrocketed to 1.5 million in November, the first month the MP3 downloads were available. Only 13,000 surfed by in October.

The joint promo stemmed from a pact inked last October through which Platinum made an equity investment and a revenue sharing arrangement with Music Connection. The Liquid Tracks downloading system was created by Redwood City, CA-based, Liquid Audio.

Sports Offers Internet portal Yahoo, Santa Clara, CA, is partnering with proteam.com, a Web site operated by catalog marketer Genesis Direct Inc, Secaucus, NJ, to develop promos for Yahoo users that will offer discounts on such sports merchandise as autographed jerseys, balls, helmets, and photos. Details of the upcoming promos are nearly complete, and the proteam.com offers will soon appear on Yahoo’s front page, according to a proteam.com spokesman. Proteam.com offers one of the largest selections of authentic merchandise from MLB, NBA, NCAA, NFL, NASCAR, and NHL.

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DVC Builds $12 million Interactive Unit There’s a surge at Dugan Valva Contess this month as the Morristown, NJ, agency acquires its second interactive business in as many months, and is shopping for more.

Last month DVC bought New York City-based Muffin-Head Productions, and was set to close its purchase of Visient on Dec. 1. The purchases expand DVC Interactive to revenues of $12 million and a staff of 100, up from 30. Capitalized billings could hit $100 million, putting DVC Interactive among the top 20 interactive shops in the U.S., says DVC Interactive president Paul Ivans. DVC spent $10 million to buy the businesses, intent on becoming a major player in online promotions, Web site creation, and media buying.

Five-year-old Muffin-Head is considered a granddaddy of New York’s Silicon Alley, with cutting-edge creative and original design for clients including Chanel, JVC, Nickelodeon, Pfizer, Philips Media, Revlon, Showtime, and Salomon Brothers. “They have a nice blend of work,” says Ivans, also a DVC exec-vp and managing partner.

Muffin-Head made the deal because it wanted “the strategy and marketing skills that a larger and more stable agency could provide,” Ivans explains.

He describes Paramus, NJ-based Visient as “a super high-end information and technology and systems firm” whose expertise in systems architecture helps DVC build a “full-service, end-to-end interactive company” offering strategy, creative, and interface design through to e-commerce and database management.

The acquisitions “are not the end, but the beginning,” says Ivans. “I firmly believe that Internet promos will eclipse advertising by the year 2002,” though online promos are “in their extreme infancy” now.

“We really think that the interactive aspect is going to become so vital to client organizations that it won’t be just a little test thing for advertising. It’s going to grow in the area of mission-critical applications for client business,” Ivans asserts. “It will change the way businesses work.”

Ivans has seen that firsthand as a participant in Procter & Gamble’s Fast Forward Steering Committee, a consortium of big-spending advertisers and interactive agencies looking to maximize the effectiveness of online marketing activities. Committee members discussed promotion’s role in achieving that at P&G’s August summit in Cincinnati. Ivans says the problem with current Web promos is that they’re still tactical and haven’t yet reached the strategic stage.

Soon online promos will absorb the bulk of U.S. marketers’ online ad funds, predicts Forrester Research, Boston. Fully 88 percent of online promos meet or exceed their objectives, according to a recent Forrester report.

Ivans is perplexed by most promotion agencies’ inertia to buy or build significant interactive capabilities. “They just haven’t latched on to this thing,” he says.

Ivans feels that the recent merger of Yahoo! and Yoyodyne is “wonderful for our industry” and a harbinger of things to come. Not surprisingly, he sees DVC’s acquisitions as significant, too.

“From our perspective, we may be the preeminent interactive agency in the promotion industry,” boasts Ivans, who says further purchases will be in the offing.

Into The Air! With experts predicting that the growth of online purchase of travel tickets will hit 900 percent in the next five years, some major players have forged new partnerships to reap their fair share.

Netcentives, Inc., San Francisco, has joined with Barnes and Noble, Music Blvd., and 28 others to spend over $10 million during the next year to support what it dubs “the largest online shopping promo in history.” The Buy & Fly Holiday Bonus is promoted with an e-mail blitz, 60-second regional radio spots, major airline frequent flyer statement inserts, and banner ads that reward online shoppers with frequent flyer miles if they visit ClickRewards Merchant Web sites and make purchases.

“We have proven that nothing else drives consumer purchase behavior like miles,” says Netcentives president and ceo West Shell III.

Participating sponsors include barnesandnoble.com, Microsoft Plaza, Music Blvd., OfficeMax, Preview Travel, Garden Escape, and 1-800-Flowers. Blau Direct Edge, San Francisco, designed the national online and offline promo and advertising campaign that it estimates will create some 100 million impressions.

The Sabre Group of Ft. Worth, TX, meanwhile, has taken its Travelocity Web site and paired with Visa USA in a major marketing pact. Travelocity will designate Visa as its preferred payment card, and Visa will in turn receive prominent branding and banner advertising throughout the Travelocity Web site. The two companies recently completed a Visa Win Your Trip promotion in which Travelocity members who used their Visa cards for online travel purchases were automatically entered to win their entire trip free.

Visa will be the exclusive sponsor of Travelocity’s “Virtually There Personal Destination Guide,” a site (travelocity. com) that gives online bookers personalized trip guides highlighting attractions, restaurants, and weather.

“There is unlimited potential for Visa and Travelocity to reach one of the fastest-growing audience segments in electronic commerce,” says Sabre Group spokesman Terry Jones.

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The College Report PROMO Magazine’s first Internet College session, held last month at PROMO Expo ’98 in Chicago’s, produced so many fascinating and useful insights for both present and novice Web promoters that we decided to present some of them here.

Speakers included Tony Jaros, consulting analyst for Simba Information, Stamford, CT; Tom Beeby, creative director, Modem Media, Wilton, CT; Jerry Shereshewsky, Yoyodyne, Irvington, NY; and Keith Butler, executive director of marketing & merchandising, OfficeDepot.com, San Francisco.

Jaros began by noting that “traffic is the key” to the Internet city, and that advertisers are “backing off of the Web” as a viable tool because “advertising revenue is so small.” Emphasizing that “traffic is power,” Jaros noted that branding and momentum are the keys to building it. Brand equity still counts, which is why America Online, the Web leader with 13 million users (tenfold more than its nearest competitor), chose Barnes & Noble as its strategic partner. The reason? “Because B&N offered a product that people would see both on and off the Web,” explained Jaros. With mergers and acquisitions rampant, the world of the Web is becoming small and smaller all the time, he added.

Beeby observed that the Web is “the ultimate marketing tool.” He said that the most effective mix for the Web marketer is to use e-mail, Web sites, and banner ads simultaneously. Beeby stressed patience – that over time online customers become more profitable.

The key word for him is “intersection” with customers. He asked: “When do you want to talk to the customers? What to you want them do to? What can you learn from the dialogue?”

Beeby of Modem Media noted that although many Web advertisers collect data on customers, ad agencies don’t put their data to use. It just sits there. But only by using such data “can you increase the intelligence of your offers,” he said.

Yoyodyne’s Shereshewsky said that 70 percent of online users never click on a Web site. He noted that the key to Web marketing is to engage the user’s self-interest, using e-mails and opening dialogues to strengthen customer response. “The Web is a medium of persuasion,” he said.

Butler of OfficeDepot.com said that Web allows the customer to define a brand based on its “value proposition.” A Web site must deliver fully on customer expectations to succeed. To do this the marketer must “create a shared interest” with the consumer. He said that above all the Web is a platform for “customer participation, an experimental platform where marketers can allow customers to test the brand and find what the customer wants.”

Major Move: Yahoo! Acquires Yoyodyne Yahoo!, Santa Clara, CA, today announced that it had acquired Yoyodyne Entertainment, Inc. Irvington, NY, for 280,664 shares of Yahoo!’s common stock. Yoyodyne’s Internet-based direct marketing resources will become part of Yahoo!’s extensive advertising and merchant services, including banner advertising, sponsorships, promos, direct marketing, and member acquisitions.

“This acquisition further enhances Yahoo!’s leading position in providing marketers with the world’s best interactive platform for reaching highly targeted audiences, along with the richest online user experience,” said Yahoo! ceo Tim Koogle .

Yoyodyne’s client list includes America Online, American Express, H&R Block, Microsoft, Netscape, Procter & Gamble, Sony Music, and Sprint. It has created stand-alone Internet marketing programs, including EZSpree.com for online shopping sites, GetRichClick.com for targeting visitors to sponsoring sites, and EZventure.com, a promotion targeted at entrepreneurs and small businessmen.

Under terms of the acquisition agreement, Yahoo! will issue 280,664 of its common stock for all outstanding Yoyodyne shares, options, and warrants. The transaction will be accounted for as a pooling of interests. Yahoo! expects to record a one-time charge of approximately $2 million in the four fiscal quarter of this year relating to expenses incurred in connection with the transaction. The deal is expected to be completed by the end of this year.

Not Just for Techies Anymore If major packaged goods manufacturers can get better data faster and less expensively online, then why are only 30 percent of them devoting substantial resources to Internet promotion?

According to Wally Balden, vp of the Interactive Solutions Group (ISG) of Market Facts Inc., Arlington Heights, IL, it’s because net users were seen to be brainy, unsociable nerds, what Balden calls “early adopter techies.” Demographically, Net users were different – richer than the average American, with $55,000 incomes, more than double the U.S. average of $25,000.

Because of this, “Netizens” were supposed to hold very different beliefs and attitudes than the rest of the country.

But in a ground-breaking study called Project Landmark, done last spring, ISG surveyed more than 3,000 matched sample households in the general and consumer Internet populations on more than 30 distinct categories including food, alcohol, appliances, and health and beauty care.

The result? “Those who have gone online are basically mainstream,” says Balden. “The behavior of Internet users mirrors the behavior and attitude of other Americans.”

Which means that the Internet research “is a viable tool” for targeting promotional data at the Internet audience.

Targeting Smart Business Fast Company magazine has partnered with Yoyodyne (www.yoyobiz.com) to create an Internet promo for more than 250,000 small business entrepreneurs. Launched on Oct. 1, Fast Company EZVenture will enter all registered users in a sweepstakes for the chance to win their choice of three grand prizes: a $100,000 investment annuity; a BMW Z3 convertible, or a home office technology suite. Weekly prizes such as palm pilots, printers, office equipment and books will also be awarded.

Using content exclusively created by the editorial staff of Fast Company, business people visiting the site will be presented with relevant articles and information updated weekly, about owning, operating and growing a business. The promotion will run through April 15, 1999.

Participants earn entries for the grand prize by finding specially marked buttons on the EZVenture site, which takes them to an exclusive sponsor page/offer. Here the sponsors have the opportunity to make very specific propositions (get information, buy a product, have a salesman call, get on an updated list, etc.). This also has the effect of delivering a very large number of highly-desirable click-throughs directly to advertiser sites.

“These sponsor offers are read, viewed and understood because they are the key to winning the prizes,” says Seth Godin, present and ceo of Yoyodyne. “The interactive nature of the program involves the sponsor in a unique, multifaceted and productive dialogue with highly-targeted and qualified customers. These prospects are reached with banners, articles, special offers, and e-mail with real frequency.”

In addition, Fast Company EZVenture offers several opportunities for sponsors to gain in-depth knowledge of promotion participants through opinion polls and “opt-in” participant lists for ongoing marketing programs. Godin says the program is the perfect promotion vehicle for marketers trying to reach small and home-based businesses.

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Peapod Excitement! Peapod Inc., Skokie, IL, America’s largest online grocery retailer, announced a multi-year national marketing agreement with Excite Inc. the second largest Internet service. Under terms of the pact, Peapod can now place high-profile advertising placements on three of Excite’s high-traffic Web sites: Excite’s Webcrawler Web navigation service, the Quicken Personal Finance site on America Online’s AOL.com portal, and Excite’s co-branded sections of Netscape Communications.

Last spring Netscape and Excite reached an agreement allowing Excite’s advertising to be sold on Netscape outlets, an arrangement that provides support for the new Peapod pact. Excite also uses AOL’s Quicken site for ads, thanks to AOL’s partnership with Intuit, Quicken’s developer.

Until now, most Peapod ads have targeted local markets or traditional off-line venues such as newspapers, radio, and direct mail. Use of these channels caused customer acquisition costs to reach between $30 and $50 per member, according to company spokeswoman Mary Wade. In a statement, Peapod CEO John Walden said the company postponed concluding an advertising deal till now because “very few of the (ad) deals make sense economically” when measured against the company’s current marketing expenditures.

Apparently this one does. While not disclosing the exact terms of the new agreement, Walden says the pact is for several hundred million Web impressions for three years while per member acquisition rates should remain about the same. Wade indicates that thanks to the new pact Peapod will be getting expanded exposure at the same cost per member as before.

Excite’s MatchLogic unit provides online advertising services that will enable Peapod to specifically target promos at customers in the seven cities where it currently offers its services.

In addition, Internet advertising will also enable the company to reach a national audience and establish its brand in new markets such as New York, where the company has plans to enter the fourth quarter of this year. The new ads will also be used to promote Peapod Packages, a new product that will drop-ship packages of dry goods and bundles or products for special occasions, such as new baby packages, college care packages, and recipes in a box.

Microsoft Rolls Out Money 99 Microsoft plans to use a $5,000 cash sweepstakes to promote its Money 99 Financial Suite, a personal financial management software program launched recently.

Microsoft also announced that InsWeb’s comparison insurance shopping services will be available on the new software. InsWeb offers products from 17 insurance companies such as State Farm, Nationwide, CNA, The Hartford, AIG, and Liberty Mutual and can be used to comparison shop on the Internet for car, term life, annuities, short-term medical, and other insurance products.

InsWeb chairman and ceo Hussein Eman says “being included in Money 99 significantly expands the consumer reach of our many insurance partners.”

Money 99 users are automatically eligible for two $5,000 cash sweepstakes drawings that can be used to pay for all their insurance needs. The drawings will take place “over the next year,” the company says.

Any consumers who complete InsWeb’s auto application will be offered a free 4-month trial subscription to Money Magazine.

Voila Las Vegas Snap!, San Francisco, the directory, search, and navigation service jointly owned and operated by CNET and NBC, debuted its Vegas Vacation Giveaway a six-week online promotion that encourages users to try the new My Snap! service, according to Snap!’s vp of marketing, Julie Welch.

To compete in the sweepstakes, users have only to click on the Vegas Vacation Giveaway icon located on Snap!’s front door (www.snap!com) and also found on the My Snap! page. A random drawing will give winners a three-day, two-night vacation package for two in Las Vegas, complete with air transportation, hotel, and a dinner at the Hard Rock Cafe. Deluxe hotel accommodations are being provided by the Las Vegas Hilton and Bally’s Las Vegas. Las Vegas Reservations System is providing air transportation.

Recently Snap! introduced My Snap!, an easy-to-navigate service that offers users the best variety of customizable news headlines than any other portal. Forty-six brand-name content providers supply information through 59 headline feeds, allowing creation of a personalized Web source completely tailored to the individual user’s interests.

The service also unveiled an innovative design that allows the user to chose among three distinct approaches to Internet navigation: global, local andpersonal. By clicking on one of three tabs at the top of each screen, labeled Home, Local, and My Snap! users can quickly select a method of sorting the Web based on their personal preference.

Rewards on the Fly Internet bookseller Barnes and Noble (www. barnesandnoble.com) has teamed with Netincentives, Inc. the leading provider of Internet promotions to offer the ClickRewards program to its customers.

ClickRewards is a free, incentive-based purchasing program that offers frequent-flyer miles and other rewards to online shoppers. As part of the agreement, barnesandnoble.com will become the exclusive bookseller for the Netincentives ClickRewards service.

In the initial launch, online shoppers who make a purchase at www.barnesandnoble.com will automatically be awarded 50 points from ClickRewards for each order of $50, with a click point rewarded for each additional dollar. These are redeemable for frequent-flyer miles from a wide range of airlines as well as hotel stays, car rentals, and more. Purchasers under $50 do not earn points from ClickRewards.

No Role For Online Promos? The recent Procter and Gamble summit held in Cincinnati was unique; it was the first time a marketer invited everyone, including competitors, to talk about how to make Internet advertising work.

In addition to the regular dialogue, there were break-out groups that discussed topics that included making online media easier to buy, creating accepted measurement standards, and cost-effective ad models and the role of promotions.

But a spokesman for Rich LeFurgy, chairman of the Internet Advertising Bureau said, that for now, an expanded role for promotions in online ads was not in the cards.

In the meantime, dialogue begun at the summit is continuing, aided by a FAST Forward Steering Committee whose members include Association of National Advertisers senior vp Robin Webster and Four A’s exec vp Mike Donahue. In addition, it will have four publishers, two advertisers, two agencies, and two technology companies as representatives.

On the Net

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In Business with Women: Office Depot and iVillage create site for female entrepreneurs. Special offers, sweepstakes, and contest giveaways will all be part of a new In Business Web site created by a partnership between Office Depot and iVillage.com: The Women’s Network, an online network that focuses on issues of importance to women.

Although the details have not been completed, the Delray Beach, FL-based retailer and San Francisco-based iVillage will announce in mid-September a Dream Office sweepstakes. The winner will have her office outfitted by Office Depot as the grand prize, according to spokeswoman Karen Pascual.

Located at www.officedepot.com/inbusiness, the site provides visitors with the tools and information necessary for starting and running successful businesses. Features will include news affecting small business owners, easy-to-download legal and financial forms, and the ability to make purchases directly from officedepot.com.

According to Office Depot director of marketing Keith Butler, the joint site was formed in part because the retailer recognized the growing importance of the Web market for women.

According to the Small Business Association, more than 300,000 women start home-based and small businesses every year. Only 42 percent of Internet users are female, though 70 million more women are expected to be online by the year 2000.

“We realized that the majority of buyers of equipment for small businesses were women and we realized that iVillage was the preeminent women’s network on the Web,” Butler says.

“[iVillage] did a compelling job of building a woman’s community on the Web,” adds Butler. “They’re super.” He says that partnering with iVillage is a natural for In Business because it reinforces both companies’ commitments to provide customers with time and cost-efficient solutions to their businesses and their lives.”

It makes further sense, Butler says, because women are increasingly Internet-savvy and they’re looking to the Web for value-added offers and informat ion. Butler says that In Business will follow up the Dream Office campaign with ongoing promotional activities.

Spree and EZ: MasterCard and Yoyodyne in online shopping promo. MasterCard International (www.mastercard.com) will be the marquee sponsor of Yoyodyne’s innovative EZSpree (www.ezspree.com) that began Aug. 17. It will offer instant discounts to MasterCard holders while providing a source of free traffic to hundreds of online merchants.

Before its conclusion, EZSpree is expected to guide more than half a million shoppers to as many as 400 of the Internet’s best known storefronts for the chance to win a $100,000 online shopping spree. Participating merchants will throw in discount exclusives for MasterCard purchasers.

The partnership between Yoyodyne and MasterCard comes on the heels of MasterCard’s recently announced marketing alliance with Excite! to serve as the preferred payment system on the Excite! Shopping Channel. The MasterCard/Excite! pairing is aimed at building consumer awareness and confidence in the benefits of shopping online.

New Banner-Tracker: WebConnect debuts ROI tracking technology. WebConnect’s ICS System is able to track an advertiser’s return on investment from impression to click to sale, on every Web site on its system, the company says.

“Regardless of what closed-network, search-engine, or Web site advertisement is going to be placed on, WebConnect’s ICS system can centrally track your ROI,” claims Jay Schwedelson, founder of the Boca Raton-based company.

The ICS concept brings together technology from two sister firms, WebConnect and Worlddata. “Worlddata lends its extensive database knowledge to WebConnect’s breakthrough central serving and tracking capabilities,” says Schwedelson.

WebConnect’s “open network” approach to the Internet affords advertisers the opportunity to reach 100 percent of the Web, rather than limiting advertisers to a closed network.

Search and Direct: CyberGuard and Eisenberg ink pact. Cyberguard Corp., Ft. Lauderdale, has signed an agreement with Eisenberg Communications Group, a division of Scan Media Inc., to market and sell a new promotional and information search engine called CyberGuard’s Galaxy. The agreement states that ECG is to initially market and sell advertising on Galaxy, but company spokesmen say that consumer promotions are to follow.

“Galaxy’s directory structure is particularly well-suited for the medical communities and for technical users, general research, and education,” says Jeffrey Eisenberg, vp of business development for 2Can Media. “The search engine provides great demographics for our customers.” Eisenberg Communications is an interactive communications source for companies seeking to do business on the Internet.

A Winner a Week: OfficeMax sweeps for students online. OfficeMax Inc. has kicked off its back-to-school program on OfficeMax Online at www.officemax.com with 600 products conveniently organized by scholastic grade level. Students are being enticed to the site with weekly sweepstakes awards of color printers and scanners. The program runs for eight weeks.

OfficeMax is also offering more than 200 Back-to-School MaxRebates, with potential savings of up to $3,350. The program enables customers to obtain participating manufacturers’ rebates directly from OfficeMax on specific merchandise purchased on the company’s Web site or at its stores. Consumers have to fill out only one form for all purchases made instead of sending individual rebate forms to each manufacturer.

In addition, a single rebate check covering all purchases submitted to the MaxRebates program is sent directly to the customer. Some of the country’s best known name brand manufacturers are participating in the MaxRebates program that ends Sept. 26. These include Crayola, Mead, Acco, Avery Dennison, Hewlett-Packard, and IBM. All customers using their Visa credit card to purchase MaxRebates items will be entitled to increase the amounts of their rebates by 5 percent.

In addition to free delivery on all orders over $50, OfficeMax Online is offering a flat rate shipping charge of $5 on orders $50 and under which is a 50 percent discount. This rate extends until Sept. 18 when the sweepstakes ends.

On the Net

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Net Pay Hoping to attract a million customers by year’s end, New York City-based Citibank launched a nationwide campaign offering cash for joining its Direct Access Internet banking service.

Citibank branch banking chief Stephen J. Liquori says that the bank sent out “Blue Team” reps to the streets prepared to hand out as much as $25 million in rebates. “We are spending a significant sum behind this, but at the same time, we expect major gains in consumers.”

Citibank looks at the Internet as pivotal real estate in the battle for dominance in retail banking. Says Liquori: “We expect to see a revenue boost for this in the third and fourth quarter for the Citibank retail business.”

Citibank, the retail business of Citicorp, America’s second-largest bank, accounted for 19 percent of Citicorp’s income in the first quarter of this year.

Internet users with access to America Online Inc.’s services or who use Microsoft Internet Explorer can access Citibank’s new online banking system, which replaces an older version.

World Giveaway Sweepstakes ClickRewards, from Netincentives, Inc., San Francisco, is offering Internet surfers the chance to win free trips to seven top world destinations as part of its new World Giveaway Sweepstakes.

Selected from the ClickRewards 1998 Travel Writers Poll, the destinations include Paris, the Caribbean, Latin America, San Francisco, London, New York, and Tokyo.

To enter the sweepstakes, users should register for the drawings and free membership in the ClickRewards program at www.clickrewards.com. Once entered, members will be eligible to win prizes in all remaining sweepstake drawings. Each week one destination will be featured and one winner will be selected to win a free, round-trip vacation for two (includes airfare and hotel) for that destination. Paris will be the first site, sponsored by U.S. Airways.

ClickRewards offers its 150,000 Internet users thousands of opportunities to earn frequent flyer miles from the leading seven U.S. airlines for participating in online shopping, sweepstakes, and subscription.

In addition to the opportunity to win a free trip, ClickRewards members can earn triple miles on selected products featured in the Gift Guide of the ClickRewards site. Shoppers can earn up to 1,500 frequent flyer miles for making a single purchase from the guide.

It’s a Snap! The Snap! Mach 3 Sweepstakes, a search sweepstakes that offers thousands of instant win prizes and a choice of three grand prizes, is going full blast. Through Aug. 4, consumers can search online for Snap! , the free Internet directory, for the opportunity to capture 10,000 instant-win prizes from such sponsors as 3Com, Borders.com, Gap, and Guthy-Renker Internet. The grand prize winner will decide whether to journey to the edge of space on a MiG-25 Russian Foxbat fighter aircraft, race the Autobahn after going through Bob Bondurant’s legendary high-performance driving school, or collect $10,000 fast cash.

During the six-week Web event, users click on Snap!, which is operated out of San Francisco, to search the Internet for fast answers and become eligible to win. Random chances occur as users enter a search query of their own and find information online. A message on the search results page instantly notifies them of wins of prizes such as 3Com Bigpicture video phones, books from Borders.com , Gap khakis, and Cross Climbers from Guthy-Renker.

Cool Wheels, Refreshing Flavors Candystand.com, the Lifesavers Web site featuring Shockwave games, sweepstakes, and other interactive items is running two new programs, LifeSavers Cool Wheels of Summer and the Refreshing Flavors of Summer Sweepstakes. The promos run through Sept. 7.

The Parsippany, NJ-based company is offering a 1999 Dodge Neon RT, Hard Rock GX bicycles, Fox Interactive Software’s Soccer ’99 game, Sony PlayStations, electronic pagers, and more. All details are available online.

In addition, Gummi Savers and MTV Online (www.mtv.com), have teamed up for a new virtual online skating game, which will be featured on Candystand as well as MTV Online’s Summer Share Web page. Gaming enthusiasts can compete for a collection of summer gear.

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