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THE POWER OF IMAGINATION WITH CHIAT ON BOARD, ONLINE SERVICE LOOKS TO BROADEN ITS AUDIENCE

By Published on .

ImagiNation Network wants to be sure that amid all the heavy talk of information superhighways there's still room for fun and games.

The computer online service that bills itself as "America's Premier Online Entertainment Network" doesn't have news, weather or statistics-essential components of most other online services. Instead, ImagiNation offers subscribers games they can play with each other. There are more than 30 of them, ranging from Red Baron, a World War I fighting game, to the more traditional Monopoly, backgammon and checkers.

But there is a little more to ImagiNation. While online, subscribers can communicate with each other in real time, either to select game partners, comment on strategy or simply to chat.

Indeed, the idea of becoming electronic pen pals is what drew many of ImagiNation's 40,000 subscribers to the service.

Now, ImagiNation is thinking bigger.

The online service is preparing its first marketing push, and has hired Chiat/Day, Venice, Calif., to help. ImagiNation has also entered into its first strategic alliance with an information provider, adding CUC International's Shoppers Advantage service to the network's online mall, which sells ImagiNation-branded products.

Perhaps most crucial to ImagiNation's future growth, AT&T last July acquired a minority equity stake in the online service, providing significant capital for both research & development and marketing. The telecommunications giant has the option to acquire ImagiNation outright within a year.

ImagiNation Network began in 1991 as the Sierra Network, an outgrowth of Sierra On-Line, an Oakhurst, Calif.-based publisher of personal computer games, and General Atlantic Partners, a venture capital group.

The main difference between ImagiNation and other online services lies in tone and graphics. Whereas Prodigy and America Online tend to be "serious" information services, ImagiNation strives to be playful. Furthermore, ImagiNation's graphics far exceed those of the heavily text-based services.

ImagiNation subscribers can create a personal profile of themselves, including a cartoonlike portrait. At any time while chatting with one or more subscribers, a player can click on the name to "see" the person he or she is conversing with.

ImagiNation has accumulated subscribers using only sporadic print advertising, created in-house. In contrast, Prodigy, the industry leader owned jointly by IBM Corp. and Sears, Roebuck & Co., has advertised heavily with slick ads from J. Walter Thompson USA, New York, and boasts more than 2 million members.

ImagiNation late last year hired Chiat/Day to handle print, radio and TV direct response advertising. Print ads already are running in computer and electronic gaming titles such as Compute!, Computer Gaming World, Wired and Electronic Entertainment.

A TV spot has been produced, and will probably air initially in spot markets.

The company hasn't yet committed to an overall media budget, but Marketing Director Jeff Leibowitz said it will be "in the millions of dollars."

In TV, he added, ImagiNation is looking at everything from 30-second spots to an infomercial. And it recently completed a direct mail program, handled by BC Consulting, Aptos, Calif.

But Chiat almost lost the account before it had a chance to present its case.

"We were all but convinced to hire another agency before our first appointment with Chiat/Day," Mr. Leibowitz said. "But they blew us away. They understood the market and did a great deal of research. And they only had two days to prepare. The involvement of [Chiat Presi dent-Executive Creative Director Lee] Clow and his enthusiasm in the product convinced us."

The electronic media plans "are still un der development," said Bob Grossman, Chiat senior VP-group account director. "Most likely it will begin in a handful of markets."

But all new marketing plans have been placed on hold until new President-Chief Operating Officer Morris Goldstein has a chance to review them.

Mr. Goldstein, formerly president of Ziff-Davis Electronic Information, joined ImagiNation in January, succeeding Philip Monego, who left the company.

The arrival of Mr. Goldstein is seen as a boon to the company's marketing plans.

"Morrie believes in marketing," Mr. Leibowitz said. "He understands the cost effectiveness of investing one dollar to get two back."

Because all advertising for the network is direct response, ImagiNation and Chiat plan to tweak both the message and the media buy to reach potential subscribers.

About 80% of ImagiNation's current users are men 19 to 45, Mr. Leibowitz said, with the rest mainly women, kids and older adults.

And those subscribers are a close-knit bunch.

ImagiNation members organize meetings and conventions throughout the year as a way to meet face-to-face. And like many online service subscribers, ImagiNation members become romantically in volved about 20 marriages have resulted to date.

Mr. Leibowitz said 50% of the people logged onto the system at any given time aren't playing a game but chatting with one another.

"The network is creating an electronic community," Chiat's Mr. Grossman said. "Chatting is part of the game. It's like playing the game in your own house."

Indeed, it is this feature of service that Chiat promotes in the first print ads.

A page ad carries the headline: "You're in L.A. She's in Cincinnati. And within the first hour of meeting her, she's strafed you, you've splattered her, she's smeared you with boogers and you've kissed her passionately. It's the start of a beautiful relationship."

The hardware requirements for ImagiNation subscribers are somewhat more sophisticated than other online services, primarily because of the complex game graphics. To log onto the system, a subscriber must have an IBM-compatible personal computer with at least a 386SX central processing unit (CPU), the PC's main brain.

For communicating, the machine must be outfitted with a 2,400-baud telephone modem.

ImagiNation is working to make the service available on Apple Macintosh computers.

Meanwhile, ImagiNation late last year overhauled its pricing structure, offering three tiers of service: Basic ($9.95 per month with 5 hours included); Gold ($49.95 per month with 25 hours included); and Platinum ($99.95 per month with 50 hours.)

Additional hours within all subscription levels cost $3.50 each.

The network hasn't turned a profit yet, but ImagiNation has built in an incentive for its agency. Chiat's contract with the network established a specific target for new subscribers, tied to a bonus for the agency.

But Brian Anderson, VP at BC Consulting, sees plenty of competition for potential ImagiNation subscribers.

"Anything that takes an hour of time from a personal computer user is competition," he said.

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