As the two major real-world bookstores begin a march into cyberspace, Amazon.com, one of the most successful of the online retailers, is moving into mainstream marketing.
Amazon.com last week hired Foote, Cone & Belding, San Francisco, for its estimated $5 million to $10 million advertising account, previously handled by CKS Partners, Portland, Ore. The company is expected to kick off a consumer print and TV campaign later this year. Online advertising will continue to be handled in-house.
DOMINANT IN ONLINE BOOKS
Amazon.com VP-Marketing Mark Breier confirmed the account shift, but was unable to comment further on marketing plans because Amazon.com is in the quiet period following the announcement of a stock offering. Amazon.com, with almost two thirds of the 1.5 million books in print in English in its cybercatalog, has dominated the online book industry with monthly sales growth of 20% to 30%. Most of its off line advertising was focused on print ads in Sunday book review sections.
However, cutthroat competition is in the offing as the two giants in the $20 billion a year industry, Barnes & Noble, and Borders Books & Music, aggressively move into cyberspace. Even publishers are getting into the cyber act, with Simon & Schuster also announcing plans to set up shop on the Web.
Barnes & Noble--which is online through America Online--has launched its own Web site, threatening to set off a price war with discounts of as much as 30% on hardcover books and 20% on paperbacks. Amazon.com typically deeply discounts only best sellers and featured titles.
BORDERS TO ATTACK
At the same time, Borders is planning a Web attack. The company last winter sponsored its first advertising campaign via Perich & Partners, Ann Arbor, Mich., a national TV effort featuring more than three dozen executions for specific book titles.
Borders and Barnes & Noble account for about 22% of total industry sales through superstores and mall-based bookstores. Wall Street analysts predict the category will grow 6% to 8% per year due to the aging population and the increasing percentage of college graduates.
FCB won the account following a review which included about a dozen West Coast shops. It was the fourth win this year for FCB's San Francisco office, which earlier picked up Fox Sports Net, Autodesk, and Aames Home Loans for billings totaling almost $60 million.
Copyright April 1997, Crain Communications Inc.