Advertising Age named its first Interactive Hall of Fame recipients last April as a way to honor the industry's trailblazers-men and women who recognized avenues to reach consumers in a revolutionary new way. The original group of 12 included Amazon.com CEO Jeff Bezos, America Online Chairman-CEO Steve Case and Jerry Yang, co-founder of Yahoo!
Advertising Age set the same criteria when it selected five additions this year to its Interactive Hall of Fame. Even though the industry is weathering much harsher conditions than it was a year ago, these individuals had the vision to set their ideas and business plans in motion early, leaving an indelible imprint on the Internet economy.
Lynn Bolger, CEO, Fastbridge.net
Lynn Bolger hasn't yet found what she's looking for in this new age of interactive and digital media. That's a key driving force behind the 47-year-old CEO of Fastbridge.net, Initiative Media Worldwide's new interactive arm.
"Interactive media is an integral part of the media business," says Ms. Bolger. "It really means looking at the market, defining the advertising opportunity and maximizing the opportunities as they are today. Whether it's putting clients into e-mail or rich media to drive a particular action online " interactive media is an important piece of [clients'] communications systems."
In March 1999, Ms. Bolger as media director was one of several top-ranking executives to exit APL Digital, then the interactive arm of Interpublic Group of Cos.' Ammirati Puris Lintas. Ms. Bolger joined what is now known as Fastbridge.net as a consultant; she assumed the CEO title in November. "I had a choice of opening my own independent shop and maybe [ending] up selling it to a company like Initiative Media Worldwide [part of Interpublic Group of Cos.], or I could work with Initiative to build it from the ground up," she says. "The realization is that interactive media is part of the media business. The skills involved in media are very different from the skills, knowledge and architecture of Web-site development. And I decided I wanted to be with a media behemoth, that was my best long-term shot at success in building a truly great interactive media business."
Ms. Bolger certainly has had a taste of media life within traditional ad agencies. After graduating from Ohio Wesleyan University in 1975 and dabbling in her major (zoology), she went to New York and began working her way through various media-planning and strategist positions with agencies including Foote, Cone & Belding, BBDO Worldwide and N. W. Ayer. She briefly left the agency world to hold a marketing sales and support position with Newsweek, which she says was "a bit dull for my taste." She returned to FCB in 1992, where as part of the early interactive team, "I got a good view of the market-the problems were broader and I got to work on a number of different projects."
In 1996, Ms. Bolger was named director of marketing for Softbank Interactive Marketing's Media Sales Group. Charged with trying to attract more advertisers to the media, "I flew on airplanes" for much of the year, she says. "It was a time when the interactive market was young and a challenge on all fronts, not only determining what was the business model, but how to sell, how to package and what was the opportunity for advertisers."
But the agency world again proved tempting, and in 1997, Ms. Bolger joined APL Digital as media planner. "I surprised myself when I went back, but it was a chance to work with a wonderful agency, terrific clients and people I knew and respected."
When Initiative came calling, "it meant I had an opportunity to really look at the interactive market and have a role in defining" what the opportunities would be, she says. With billings of $50 million this year from clients such as Nextel, Home Depot, AT&T Broadband and Club Med, Ms. Bolger is helping to shape the trend of direct-response advertising and brand advertising coming together as one. It's happening first in interactive media, and at Fastbridge, there's an opportunity to build strategies and campaigns around that long-term trend, she says.
Ms. Bolger is bullish about all interactive media, whether it comes through the radio as streamed radio, wireless in all forms, or via interactive TV. As for interactive TV, it is "definitely going to happen," she says. "We just haven't defined what 'it' is. Basically, we're dealing with a traditional medium that has a direct-response mechanism attached. That challenge is to figure out the advertising opportunity."
With at least 10 inquiries a week from traditional advertisers anxious to get into the interactive space, Ms. Bolger zeroes in on how she'll be spending most of 2001. "I'm looking for clients who come in with the really tough interactive-marketing questions," she says. "The challenge is to give them the correct answer, whether that's the right spending level or how online connects with offline marketing."
Rishad Tobaccowala, President, Starcom IP
Rishad Tobaccowala spends a lot of time on airplanes, flying from one client of Starcom IP to another, racing from Chicago to London to Hong Kong and back again-seemingly in the same day.
That's probably where Mr. Tobaccowala, 41, president of Bcom3 Group's Starcom IP, does most of his thinking. And that's probably why, when asked to spare 15 minutes to share a few thoughts about the future of interactive advertising, the conversation stretches to almost an hour.
"My sense right now is that this business is more real than it ever has been, but it still has a way to go," he says. "IP [Internet protocol] has always been much more about a new way of thinking, of organizing and of marketing than about technology and acting cool."
This is not a conclusion Mr. Tobaccowala has reached lightly-nor does it trouble him that many high-flying dot-coms have come down to earth. He's been working in digital and interactive media since before those terms became industry buzzwords, and "I'm likely to be working in this industry for many years to come."
As president of Starcom IP, he helped found the company in January 1999, develop its vision and attract and provide strategic counsel and service to its clients.
Mr. Tobaccowala has more than 20 years of marketing and strategy experience, virtually all with the Leo Burnett/Starcom empire, working across a range of clients. Mr. Tobaccowala holds a bachelor's degree in mathematics from the University of Bombay, India, and a master's degree in business administration from the Graduate School of Business at the University of Chicago. He began his career at Leo Burnett as a media buyer-planner in 1982, working his way up the ladder in a series of media-planning positions including founder and director of Burnett's Interactive Marketing Group. He decided to leave Leo Burnett in 1996 to serve as the president of Giant Step, the agency's interactive unit.
During his three years as president, Giant Step grew from an eight-person staff to about 100 employees and clients including Maytag Corp., General Motors Corp. and Procter & Gamble Co. Mr. Tobaccowala took that experience to start Starcom IP, which as a Bcom3 Group sibling agency shares clients with Giant Step.
"Giant Step was an opportunity to bring together new people, a new organization and a new way of doing business, something that I couldn't achieve at that time at Starcom," Mr. Tobaccowala says. "Stepping outside [Burnett] while still being at Burnett was a chance to move more quickly into the next stage of interactivity."
Firmly back in the fold and in command at Starcom IP, Mr. Tobaccowala has overseen a steady build-up of clients, including Hallmark.com, Nintendo of America and Miller Brewing Co., handling more than $75 million in billings in 2000.
"Despite everything that is going on right now [with many dot-com businesses folding], this interactive world is for real," he says. "Most organizations are increasing their commitment to understand how interactivity is forever changing the way they communicate with customers."
Scott Kurnit, Creator, About.com
Scott Kurnit was unemployed and sitting at his kitchen table in 1996 when he got the idea for a niche-driven Web site so rich in content people couldn't stay away from it.
He got hooked on it himself that day, and eventually created About.com. Today Media Metrix rates it as one of the Internet's 10 most-visited sites, frequented by about 60 million consumers worldwide who are hooked on its 700 niche topics.
When Primedia agreed to buy it last fall in an all-stock deal valued at $690 million, About.com was on target to turn a profit early this year. Meant to be Primedia's major Internet play, it will be a merger linking one of the biggest publishers of niche magazine titles with the Web's biggest developer of niche content. The deal should close in late February.
The key to About.com's success may lie in the bare simplicity of Mr. Kurnit's original idea: one site guiding consumers to hundreds of microsites, each drilling deep into specific topics ranging from garlic to golf.
While others may have had the same epiphany at the time when the Internet was beginning to explode, few were equipped to execute the plan like Mr. Kurnit, 46, who already knew a thing or two about the Internet.
He had just ended a roller-coaster couple of years, first succeeding in boosting Prodigy's Internet fortunes, then trying to knit MCI Communications Corp.'s Internet operations together with News Corp.'s Delphi. That effort, ultimately abandoned by MCI, taught him that "throwing money at the Internet" was not necessarily a winning strategy.
Thanks to his first job as a documentary filmmaker, and then several years spent at Time Warner in TV programming and advertising sales, then inventing a cable TV pay-per-view service for Viacom, Mr. Kurnit understood the lure of compelling content. He also knew how to run a business.
"I put what I knew together and devised the idea for a highly granular Internet service that would be totally independent and grow on its own," he says.
The site-originally called The Mining Co. when it began in June 1996-grew exponentially. Today it consists of more than 700 cultivated topics, consistently ranking around No. 7 in overall at-home and at-work online traffic.
Mr. Kurnit's "granular" plan included hiring independent contractors, as needed, who research and manage the microsites. Each time a page is viewed, its "guide" is paid three-tenths of a penny, creating incentives to constantly improve the content.
"Some of our guides are making $20,000 a month by creating some of the most compelling pages on the Internet," he says.
The hottest topics recently included Chinese culture and Southern cooking, and the competition to manage About.com's most popular sites is fierce.
About.com now has 800 guides in 20 countries, and 500 full-time employees. Some 350 are in its Times Square headquarters in New York, where the atmosphere is "highly charged with creativity, and the excitement of being around a lot of really smart people who are experts on all these amazing topics," Mr. Kurnit says.
His own reputation includes being something of a workaholic, running a tight ship and inspiring others to join his cause with his infectious enthusiasm.
"In 1996 people thought what we were trying to do was crazy, that no software was available that would let you link all these sites remotely with workers all over the place," he says.
But he persevered and within a year had developed a software platform allowing users to smoothly navigate from one microsite to another within About.com.
"Our biggest strength has been consistency and efficiency, and making sure we had a solid platform underneath us," Mr. Kurnit says.
Only weeks before the Primedia merger, Mr. Kurnit had championed the glories of About.com's independence. He now insists the company's spirit will remain unchanged despite its new corporate face. "We're gaining immediate, powerful brand recognition we needed through Primedia's print channels, and they're getting access to our Internet content and our search engine, which is unique in the publishing world," Mr. Kurnit says.
Primedia's stock price skidded after the deal went through, but analysts have supported the merger, noting advertising and content crossover opportunities for each company as they target enthusiasts of everything from cars to fashion.
The Primedia merger will allow About.com to gain more offline exposure, and it has already spawned in-house produced print campaigns in dozens of Primedia titles. In turn, many Primedia titles are driving readers to new title-specific sites within About.com, using its powerful search engine.
"Whenever you close a deal, the first thing you want to know is what's the deal. We found out right away there were no surprises, and [Primedia] is our mirror image in print. This is a situation where one and one makes three, and we're all on the same page," Kurnit says.
Chan Suh, Chairman-CEO, Agency.com
Chan Suh is bullish on wireless. he's so convinced it's the next big marketing tool that he's handed out wireless devices to everyone-from finance and administration to creative and account management-at Agency.com, the five-year old New York-based Internet professional-services firm he co-founded and now heads as chairman-CEO.
"You never know where the next good idea is coming from," says Mr. Suh, 39. "Remaining open to change" is how he characterizes himself and his chosen profession, which lately has taken a beating.
Just last month, Agency.com joined the ranks of i-shops announcing layoffs. Because of lower-than-expected financial results, the company was forced to cut 190 staff positions and close its office in Vail, Colo. Agency.com shares recently traded at less than $4 a share, off more than 90% from its December 1999 peak of $98.
But despite the layoffs and the share-price slide, Mr. Suh remains focused on the future. Be it wireless-a medium he says "is definitely going to be a powerful component of any interactive relationship from this point on"-or fine-tuning a multichannel marketing strategy for the agency's blue-chip clients, Mr. Suh is convinced that the earlier one learns a technology, the sooner one can implement ideas for clients.
Trying to figure out exactly how people want to communicate with each other and with advertisers is what brings clients to Agency.com, Mr. Suh says. "The Internet is not about the dot-coms, it's really about the transformation of every company and every relationship," he says. "All the focus on dot-coms that fail is misguided. In any industry, in any given year, only a handful [of start-ups] survive."
Surviving beyond the launch is a concept Mr. Suh has faced throughout this career. He started off in publishing in 1986, first at Cond1 Nast and then at Time Warner, where he led the marketing efforts for various magazines, including Details, Life and Vibe. He then joined the team that conceptualized and launched Pathfinder, Time Warner's Web portal, which eventually shut down.
Agency.com opened for business in 1995 with a Macintosh and $80 in a checking account. Helped by an early cash infusion from Omnicom Group, which owns about 38.6% of the company, it quickly grew and today employs more than 1,400 in 12 offices worldwide. Clients include British Airways, Reuters, Deutsche Bank and Coca-Cola Co. Agency.com went public in December 1999 and now expects fourth-quarter 2000 revenue between $56 million and $58 million, a number that came in lower than Wall Streets expectations due to the industrywide slowdown in business.
Mr. Suh says he hopes the agency's focus on bigger, more traditional advertisers will buoy the company.
"These are companies that think long-term because they can afford to, and it's those clients that we feel we can best serve. We're building businesses for the long term; momentary blips ... are just that," he says.
That was the attitude Mr. Suh carried with him when Agency.com took the IPO plunge, and it's an attitude he espouses in this year's much-tougher climate for i-shops. "When we went out into the public markets, people said we were missing the boat," he says. "I said I had a long-term plan and it [wasn't] going to happen overnight."
Jonathan Nelson, Co-founder and Chairman, Organic
Back in 1993, before most of the world ever heard of the Internet Jonathan Nelson and three of his friends decided it was the right time to launch an agency that would specialize in interactive marketing.
San Francisco-based Organic originally was conceived as a Web-development shop, working with corporations to post glossy corporate brochures on the nascent Internet. However, that's not really what happened.
Instead, Mr. Nelson, 33, found himself riding the Internet rocket, taking two companies public in less than a year. He led Web measurement and analysis company Accrue Software, a company he co-founded in 1995, to an initial public offering in the summer of 1999. Mr. Nelson then took Organic public in February 2000.
"I had no idea all of this would actually become something-much less a multibillion-dollar industry-and I'd be lying if I now [said] that I did know it would be big," says Mr. Nelson. "I just knew that the idea of interactive marketing was really interesting."
Mr. Nelson might not have known how low his stock price could have plummeted, either. As the company's greatest shareholder, with voting rights on 59.3% of Organic's shares, he watched the company's stock tumble below $1 a share in December, off an all-time high of $60. The fall was sparked by news that Organic would miss fourth-quarter and early 2001 earning estimates and would lay off 270 staffers, or 25% of its work force.
In addition, recently opened offices in Atlanta and Boston would be closed, and Mr. Nelson, the company's chairman and founder, stepped down as CEO. Mark Kingdon, a former PricewaterhouseCoopers management consultant most recently with Internet incubator idealab!, was named CEO. Organic said Mr. Nelson would focus on guiding the company's strategy.
Still, Mr. Nelson says he thinks the slowdown in dot-com advertising is only a lull in the action, citing a list of new clients, including Target and Bell Actimedia. Organic also made a concerted effort in the third quarter of 2000 to reduce its exposure to dot-com start-ups: Pure-play dot-coms now make up only 8% of its revenues, the agency says, compared with 25% of revenues in 2000.
Organic discovered, however, that traditional marketers aren't immune to market cutbacks either: Troubled DaimlerChrysler accounted for 30.6% of Organic's revenue in the third quarter; although the direct effect on Organic remains to be seen.
Organic expects fourth-quarter revenue to be about $26 million, down more than 30% from the third quarter, when the company lost $16.5 million. While Mr. Nelson admits that "it's not always pleasant running a public company," especially on days when the Nasdaq tanks, "I still have a passion for this business that, while it has been tested throughout the years, hasn't gone away. We get to have a front-row center seat to help solve really interesting problems for some of the best companies in the world, like Sony, Federated [Department Stores], DaimlerChrysler."
In the last 18 months, Organic not only made the transition from interactive agency to "professional services firm"-a description Mr. Nelson believes more aptly describes Organic-the agency also added offices in Detroit, London and Singapore, meeting Mr. Nelson's goal of having a presence in North America, South America, Asia and Europe.
"Ultimately, the thing about being a public company is you're more accountable," says Mr. Nelson.
"It doesn't change the way I go about doing my business. If you present the value, put your clients first [and] show results, you'll be successful and people will invest in your future."
Copyright January 2001, Crain Communications Inc.