Lot21 to focus on Web media results
Tired of seeing users land on advertisers' Web sites and then leave because no clear sales pitch was presented to them, Kate Everett-Thorp decided to do something about it.
Last month, this 28-year-old executive, along with four co-workers, left CNET:The Computer Network, where she was VP-crusader, advertising programs, to start Lot21, a San Francisco-based agency that will focus on return-on-investment advertising.
"We're going to have a pure focus on online advertising and the integration of the medium beyond the banner," said Ms. Everett-Thorp, who is president-CEO of Lot21, and former chairman of the Internet Advertising Bureau's media measurement task force.
"Many advertisers are basing the success of an ad on the click rate of a banner," added Eric Wheeler, VP-operations at Lot21, and formerly director of partner management for CNET's Snap! Online."It might be a great ad--but if you drop them off at the front door of a Web site and they get a disconnection, you have the possibility you've lost them."
BRING TARGETED OBJECTIVES
Lot21, which loosely translates to "real estate of the future," wants to bring the same accountability and targeted objectives found in traditional media to the online world. This means, for instance, if a client wanted to generate new subscribers for a service, Lot21 would create an online campaign with a focus on microsites and sponsored content, for example, to carry out this specific objective. It would then follow up with research and testing.
Lot21 will handle all strategy, planning, creative, media buying and research. It will not build corporate Web sites, and is considering forming strategic relationships with Web developers to handle those duties.
It remains to be seen, however, how this will fly with marketers. At press time, Lot21 had signed one ISP client and was close to signing deals with two others, but would not disclose their names.
It's also finished a first round of financing, and declined to disclose how much it had raised.
ROI HAS BEEN `ELUSIVE'
"[Return on investment] has been elusive in traditional media, as well as in online media," said Rich LeFurgy, senior VP-advertising, ESPN/ABC Internet Ventures, New York, and chairman of IAB.
"Accountability for online media represents an opportunity, but it's not the only opportunity for building brands," added Mr. LeFurgy, pointing to the recent unfreezing of Procter & Gamble Co. ad money from a click-through-only model as an indication that "brand-building is being recognized by more and more advertisers."
The big issue for Lot21 is whether it can make money by focusing on interactive advertising without supplementing its revenue with major Web site development.
LOT21 WON'T BE ALONE
Peter Storck, group director of online advertising at Jupiter Communications, believes Lot21 is pursuing the right strategy. But Lot21 is "not going to be alone in doing it. I think most leading interactive agencies are on to that," Mr. Storck said. On the other hand, he added, "The interactive agency space is still very new and up for grabs. A smart group of people with good experience definitely has a chance."
Copyright February 1998, Crain Communications Inc.