Dot-com advertising mushrooms in Australia

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SYDNEY--The hordes of dot-coms throwing advertising dollars at traditional media have made the Internet the highly profitable darling of the Australian marketing industry.

In 1999, ad spending by fledgling dot-com brands had soared to $51 million, with 400 brands jostling for the public's attention, according to figures compiled by media monitors AIM Data.

That's up 168% from 1998, when 180 dot-com brands spent a total of $19 million on mainstream advertising through newspapers, TV, magazines, radio and outdoor.

The Internet brand that spent the most in traditional media last year was IBM e-business at $4.8 million, according to AIM, followed by One.Net at $4 million, Telstra Big Pond at $2.5 million, Etrade Australia Securities at $2.5 million and AAPT Smartchat Net at $2.2 million.

Chris Murphy, founder and executive chairman of Internet radio station Digital One, questions the value of much mainstream advertising, saying his company had taken a targeted approach. This weekend Digital One launches an ad campaign at the Tropfest short film festival.

"What we're doing is taking a very long-term view of the brand and spending our money on developing our products, making sure our technology is the best in the world, and engineering and design,'' Mr. Murphy says.

However, with most dot-com brands receiving large amounts of cash backing from investors the focus tends to be on developing mass-market branding strategies to raise awareness. Pressure to list on the stock market also has seen a growing proportion of advertising in financial and business-oriented media.

Copyright March 2000, Crain Communications Inc.

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