Refashioning AOL image
The independent shop, known for its award-winning work on the Nike account, was told late June 6 that it had prevailed over Omnicom Group agencies BBDO Worldwide and DDB Worldwide, both New York, for the job of refashioning AOL's image for the broadband age. Wieden also has category experience: It worked on Microsoft Corp.'s MSN in 1995.
BBDO, which currently handles advertising for AOL's broadband service and related entertainment products, also picked up additional duties: It will create advertising to launch AOL 9.0, along with premium services when the latest version of the service launches in October. AOL 9.0 was originally believed to be part of the corporate advertising assignment. It was unclear at deadline what the assignment means in additional billings for BBDO.
A spokesman for BBDO said no one was available to comment; a DDB spokeswoman could not be reached; and a Wieden representative did not return calls by press time. AOL executives were unavailable for comment.
Executives present during the three final presentations included Jonathan Miller, AOL's chairman-CEO; Ted Leonsis, vice chairman of AOL and president of AOL Core Service; Lisa Hook, president of AOL Broadband, premium and platform services; Joe Redling, AOL's chief marketing officer; and Len Short, executive vice president for brand marketing.
Mr. Short led the review process. He recently told Advertising Age that AOL spent $40 million on broadband advertising from January to May, and he puts broadband spending for the balance of the year in the $40 million to $60 million range.
Eroding dial-up business
AOL is racing to reinvent itself as a hub for community, communication and content rather than be pervceived as simply an Internet access provider. AOL 9.0 is expected to offer an array of new broadband-enabled features, special content and premium services. Mr. Short has said AOL needs to show it plays a role in helping people navigate their lives through wireless alerts, interactive polls or real-time chat.
The agency selection caps a grueling process and comes as America Online feverishly tries to move its dial-up Internet customers to broadband service. The company's cash-cow dial-up business is eroding faster than it expected, according to Wayne Pace, AOL Time Warner's chief financial officer, who briefed analysts last week at the Deutsche Bank media conference.
Mr. Pace said the company has lost more than 1 million dial-up customers since its subscriber numbers began sliding late last year. AOL has about 26 million customers in the U.S. and a $23.90-per-month subscription fee; a broadband add-on is $9.95 a month. AOL is expected to introduce new pricing and a score of new for-pay premium services by the fall.
The review was a two-horse race between BBDO and Wieden up until three weeks ago when AOL put DDB back into the mix. The move was instigated by Mr. Short, who had previously worked with Lee Garfinkel, DDB's chairman and chief creative officer; Mr. Garfinkel joined DDB in March from now-defunct D'Arcy Masius Benton & Bowles, New York. Interpublic Group of Cos.' Initiative Media, New York, handles AOL's media buying and planning account.