Advo lures dot-coms to realm of direct mail

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Advo, the direct mail company that reaches 80 million households a week, is heading online.

As the Windsor, Conn.-based service company looks beyond its ShopWise shared ad mailers and subsidiary mailing services, it's moving cautiously, planning to use its ShopWise.com subsidiary to bring more dot-coms into the direct mail world.

STARTING SLOWLY

"You're going to see us start slow but bring some solutions that really make sense and are value-added to our clients," said Chris Hutter, VP-investor relations at Advo. "We're not going to try to do something that we don't have a good understanding of."

Don McKenzie, 45, former president-CEO of Advo's SuperCoups subsidiary, took the helm of ShopWise.com last week as its first president and is in the initial stages of crafting the group's business plan.

"We will be helping dot-com companies harness direct mail as well as give a strong complementary strategy to our 23,000 advertisers," he said.

Advo clients include major marketers such as Ford Motor Co., Home Depot, McDonald's Corp., Pizza Hut, Safeway and Toyota Motor Sales USA.

In addition to developing online strategies that can be marketed to advertisers, Mr. McKenzie will use techniques such as CD-ROM insertion and e-commerce focused print supplements to turn dot-coms into direct marketers.

Netserts.com, an advertising magazine dedicated to dot-com direct mail ads, is currently the only business operating under the ShopWise.com umbrella. Advo, which has a controlling interest in the magazine, includes Netserts in 10 million of its shared mail pieces each week.

At SuperCoups, Mr. McKenzie partnered with Coolsavings.

com to include local coupon offers on the discount site. The partnership, which was tested last spring and offered to all SuperCoups franchises last fall, also allows SuperCoups to tap into Coolsavings' database of registered users.

AWAY FROM MAILBOX

Mr. McKenzie said over time it might make sense for ShopWise.

com to enter into similar partnerships with dot-coms.

"What Advo has such an opportunity to do is not only have a very good print strategy for its merchants but also learn a lot more about consumers' interests and needs to help merchants learn more about consumers, about who's using their coupons and why," Mr. McKenzie said.

He sees partnership potential with established coupon sites as well as the possibility of affiliate marketing programs and e-mail and loyalty based tactics in order to reach consumers at contact points away from the mailbox.

"The nice thing about Advo sitting back on the sidelines as much as we have is it's clear to us that no one has had a breakthrough strategy [in online couponing] that has truly differentiated themselves from the field," Mr. McKenzie added.

But Michael Petsky, president of the Winterberry Group, a New York consultancy, isn't convinced that any direct marketers will be able to identify a breakthrough strategy.

"No one has done it yet, and [Advo] won't be the one to do it," he predicted.

In general, direct marketers have been slow to move forward with unique Internet initiatives because they're so focused on real profits and revenue, Mr. Petsky said.

ADVO'S ATTRACTIVE REACH

While direct marketing service companies have been faster than direct merchants to target Internet opportunities in the database, mailing list and fulfillment arenas, because Advo's service is paper mail it has likely taken longer to find an online niche.

But as dot-coms recognize brand-building is more successful when it's done in a bricks-and-mortar world and marketers struggle to get mainstream consumers online, Mr. Petsky said, Advo's household reach is likely to be an attractive way to reach the public.

"Direct mail is one of the good ways to get to middle America," he said.

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