Marketers buy into Peapod online

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Advertising and online grocery shopping go together like...peas in a pod.

So hopes Tim Dorgan, president of computer grocery service Peapod Interactive, whose first sponsors--Ore-Ida Foods (an affiliate of H.J. Heinz Co.), Kraft Foods and Bristol-Myers Squibb Co.--go live today.

The marketers are ``participating in a learning lab of which advertising, research and promotion are all components,'' Mr. Dorgan said. Each paid in the ``low six-figure range'' for a 12-month sponsorship.

The marketers will experiment with online coupons, create information modules offering recipes and helpful hints and place banner ads in strategic locations online. For now, Peapod guarantees category exclusivity to advertisers and plans to have about 10 sponsors by yearend.

``The capability to influence the online consumer at the true point-of-purchase decision...makes Peapod truly unique,'' said Mr. Dorgan. ``We'll also provide input on merchandising, promotion responsiveness, market-basket composition and new-product viability.''

Come November, the service also plans to offer sponsorable features, including holiday cooking ideas, stress reduction tips and nutrition and meal planning calendars.

Although Evanston, Ill.-based Peapod has been around for several years, it only now has created a Windows-based interface that accommodates advertising. Peapod will work with marketers to create appropriate applications.

``In the near future we'll also include Internet access via our software where we plan to hot link directly to package-goods manufacturers--there's a real natural connection there and lots of opportunity to do interesting cross-promotions,'' Mr. Dorgan said.

Peapod has more than 10,000 subscribers (80% of which are women) in Chicago and San Francisco who use their computers to shop for products at Peapod-affiliated stores.

Subscribers pay hefty fees for using the service, however: $29.95 to start, a $4.95 monthly membership fee and a delivery charge of $6.95 plus 5% of the grocery total.

In addition to advertisers, the service will also be sporting a more user-friendly, playful interface as well as the option to sort by nutritional value, fat or calories.

Peapod last month launched a radio, newspaper and point-of-purchase campaign in Chicago and San Francisco to drum up interest in the service. The ads, created in-house, use the tagline ``Smart shopping for busy people.''

Copyright October 1995 Crain Communications Inc.

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