Bertelsmann has quietly awarded the estimated $30 million launch of its online book-selling venture, tentatively named BooksOnline, to OgilvyOne Worldwide, New York.
The German media giant sees online book-selling as a war, and plans to invade the turf of already established competitors such as Amazon.com, barnesandnoble.com and Borders.com, said an executive familiar with the review.
OGILVY INTERACTIVE'S ROLE
Exact plans for traditional and online advertising are not clear; however, it is believed the account will be handled by Ogilvy Interactive, a unit of OgilvyOne. Ogilvy & Mather declined com-ment. Concrete Media, New York, will design the site.
The BooksOnline venture will be housed under Bertelsmann's Book Group and is expected to have a trial launch in September, followed by a full-scale startup in October. BooksOnline will offer titles issued not only by Bertelsmann's publishing houses--which include Bantam, Doubleday Dell and recently acquired Random House--but will also sell books from international publishers.
Bertelsmann is not alone in preparing for bruising competition; rivals are boosting ad spending and hiring new agencies. Last week Barnes & Noble awarded its $38 million barnesandnoble.com business to TBWA Chiat/Day, New York, after the account was serviced for less than a year at Weiss, Whitten, Stagliano, New York. Executives close to the review said the retailer sees its main competition as Amazon.com, leader in the online books marketplace.
Amazon.com jumped into the game first with a bang last year; its agency, Foote, Cone & Belding, San Francisco, created a campaign that included TV spots, then unheard of for an Internet company. Amazon.com spent $3.2 million last year. Through April, it's already spent $3.6 million, according to Competitive Media Reporting.
ADVERTISING KEY TO SUCCESS
Barnesandnoble.com plans its own aggressive, noisy attack for fall. The company has so far spent less than half its 1998 budget--leaving a large chunk for the new TBWA Chiat/Day work.
"It is not our intention to hire Chiat/Day, clip their wings and go passively into the night," said a Barnesandnoble.com spokesman, who said advertising and marketing are key to success.
A more recent entrant, Borders.com is preparing for a late summer grand opening of its online bookstore. Scott Wilder, director of Borders.com, did not want to discuss specific ad plans due to competitive reasons. He did say the company will probably use Borders' agency, Butler, Shine & Stern, Sausalito, Calif., and direct marketing will play an important role.
Contributing: Mercedes M. Cardona.
Copyright July 1998, Crain Communications Inc.