AOL DISHES OUT DISCS, ADS AS IT UNVEILS UPGRADE: GOTHAM WORK TO SUPPORT PROGRAM SAMPLING 1 MIL CD-ROMS/WEEK

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Just when you thought you'd seen the last shrink-wrapped disc from America Online, get ready for the CD-ROM blitz.

The online company this week begins an aggressive push to launch AOL 4.0, a spiffy upgrade to its 2-year-old software.

An estimated $40 million ad campaign from Gotham, New York, will supplement a massive sampling effort. In addition to distributing millions of CD-ROMs through newspapers and magazines, AOL will drop thousands more at bank kiosks, gas stations and school cafeterias. The drive is part of a three-month effort to boost distribution to 1 million CDs a week.

TESTIMONIAL ADS

AOL's new ads, slated to debut Oct. 5, are said to build on the current strategy of featuring customers, with their testimonials focusing on the ease of using the new version.

AOL Chairman-CEO Steve Case wouldn't discuss specifics of the advertising campaign, only saying the coming effort from Gotham will be a continuation of the past strategy of hitting a mass audience.

"Whether you're 6 or 60, we want you on AOL," he said.

AOL is the leading online publisher with 13 million subscribers.

TV ads will run on network and cable TV, and on 600 college TV stations nationwide. AOL also will sponsor national radio services "Schedule Metro" and "Shadow Traffic."

While the bulk of the advertising is designed to reach a mass audience, demographic-specific advertising is also expected to launch this year with an initial effort targeting teens.

CONTINUING SAMPLING

Sending out software samples to attract customers is a familiar marketing tactic for AOL. The company first began distributing discs in 1993, and except for a winter 1997 hiatus, has stuck with the technique.

"We've always believed if people will try the product, they'll like it," a spokeswoman said.

AOL's original discs turned up in some of the most unlikely places, including pizza boxes, airplane food containers, cereal boxes and even Omaha Steaks packages, where the discs had to withstand flash freezing. Although AOL is mum about the specifics of its current effort, the CD-ROMs will turn up "everywhere consumers are," said the AOL spokeswoman.

The 4.0 upgrades include a faster installation time and an easier way to sign up. Some of the other new features -- such as e-mail spell check and the ability to switch among multiple screen names without disconnecting from the service -- were requested by subscribers. Also new is AOL Anywhere, which lets users access AOL e-mail and instant messages via the AOL.com Web site.

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