The 1998 online holiday shopping season brought in roughly $2.3 billion in revenue, according to Jupiter Communications, and Web merchants are pursuing new opportunities tied to seasonal events, from content branding to shopping promotions to new advertising programs.
"As we have seen a cycle with [online] ad sales [reflecting traditional advertising cycles], we will also see a cycle as it relates to seasonal promotional sales cycles moving onto the Internet," said Evan Neufeld, senior analyst at Jupiter. Jupiter does not track e-commerce revenue for Valentine's Day.
HOLIDAY BRINGS OUT MERCHANTS
Virtually all categories of Web services, from entertainment sites to gift and flower merchants to portals, this week are launching Valentine's Day specials.
Warner Bros. Online, which during Christmas rolled out a Holiday Shopping Picks area on its site (www.warnerbros.com) that placed advertisers in custom environments for $25,000 to $50,000, is extending that area with a Valentine Shopper area (www.wb.com/holiday).
So far, advertising partners include Brandsforless.com, 3Com, Video Premiere and online music store TotalE, said Rich Sutton, VP-sales and client marketing for Warner Bros. Online.
PROMOTIONS PAY OFF
Pointing to a return on investment of five times the cost of advertising for some of its Holiday Picks advertisers, Mr. Sutton said the shopping boom is expected to continue for Valentine's Day.
"Initially, it was mostly guys doing the shopping [online]," said Mr. Sutton. "Now, the online world looks more like the offline world," he added, pointing to the 50% to 85% female demographic for various areas of Warner Bros. Online.
"Our job is to place our advertisers within a contextual environment that gives the audience guidance as to great places to shop," he said.
And the online store isn't the only Warner Bros. business unit hoping to cash in on the holiday. Today, Warner Music Group introduces TuneMail, an online greeting card service that lets users attach 30-second audio clips of participating artists to free e-mail cards.
"We have created an interactive and fun way to utilize the great music of our record labels to express the emotions of the holiday," said Donna Cohen, director of multimedia for Warner Music Group.
TuneMail (www.tunemail.com) uses Microsoft Corp.'s Windows Media Player to stream audio clips, from artists such as Cher, Jewel and Hootie & the Blowfish. Participating record label companies include Warner Bros. Records/Reprise, Elektra and Atlantic.
M&M/MARS SPONSORING TUNEMAIL
M&M/Mars is the sponsor of TuneMail, which links users to an online order center offering a 20% discount off the price of the featured albums.
However, said Ms. Cohen, "The goal of all of our [online] projects is to help users discover new music. We don't care where they buy it. We still believe in bricks and mortar."
Other merchants and media sites are coming up with creative uses of e-mail greetings and content to build brand awareness and drive sales.
Disney Online (www.disney.com) created Cupid's Corner on its site, an area which features entertainment content, commerce and activities around the holiday.
In an extension of a promotion launched on Disney's Family.com last year, Disney Online is featuring D-cards in Cupid's Corner, which let users create and send personalized electronic greeting cards featuring Disney characters.
"This is about fun and sharing and communication," said Beth Ifcher, VP-consumer marketing for Disney Online.
The effort is tied to the tagline of "Bringing the Magic of Disney online." Disney Online, which works with USWeb/CKS, New York, is running an online campaign to drive traffic to Cupid's Corner.
Meanwhile, card-only sites are rolling out new initiatives to compete with the electronic greeting card efforts being launched on content, commerce and portal sites.
E-greetings launched a "Log-on, Love-in" sweepstakes promotion beginning Feb. 1, offering a two-week trip to three romantic cities. Every e-card sent qualifies as an entry.
CHALLENGING OFFLINE MERCHANTS
"This is our way to encourage people to send even more [cards]," said Tony Levitan, E-greetigs president and co-founder.
E-greetings, which relies primarily on advertising revenue, also has e-commerce partnerships with Godiva Chocolatier, FTD/Florists' Transworld Association, Gour-metMarket.com and other sponsors. After users send e-greetings, they can link to these sites to order Valentine's gifts.
Efforts by these and other online competitors are forcing traditional card and gift retailers to launch new online strategies.
"If someone gives away your product for free on the Internet, that is a problem," noted Mr. Neufeld of Jupiter.
Hallmark Cards, which charges for about one-third of its online greetings (more than 1,000 are free), has launched an array of Valentine promotions and e-commerce efforts, including online polls, contests and gift picks.
1-800-Flowers, which took 50,000 online Valentine's Day orders last year, expects that number to double this season, said a spokesman.
"This is a continual reinforcement of the mainstreaming of the Web," the spokesman said.
`PASSPORT TO LOVE'
While category sites such as gifts, flowers and entertainment roll out Valentine's efforts, portals are hoping to capitalize on the holiday, too. Following are some strategies:
* Theglobe.com is offering Passport to Love, sponsored by Discover Card, featuring free online greetings by Hallmark Cards, romantic trips from Lowestfare.com, and a cyber wedding, in which a real couple who met on theglobe will exchange virtual vows on Feb. 14.
* America Online launched Cupid's Gift Finder, a personalized shopping service featuring retailers such as 1-800-Flowers, 911gifts.com, Fragrance Counter, Godiva Chocolatier and iQVC Jewelry.
* MSN.com proclaimed February the Love Month, with special areas on its site including the Love Machine gift finder, Romance-O-Meter love quiz, Cupid's