Web leader revises sales strategy

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Netscape lowers rates, taps AOL

Netscape Communications Corp. last week made several major changes in its Web advertising strategy that could have repercussions throughout the industry.

Netscape reduced the price of its most popular ad offering--a $30,000 one-month banner with 1 million impressions--by 20% to 30%. The company also tapped America Online to sell ads on the Netscape site to consumer-oriented companies, and said it would begin using ad management software from NetGravity.

As one of the largest sellers of Web ad space, Netscape's moves will be closely watched.

"We'd like to be a small part of every buy for Internet advertising," said Barbara Gore, publisher of Netscape's home page. "We consider our site to be the gateway to the Internet."

$1.9 MILLION IN ADS

Netscape is the fourth largest seller of Web ad banners, according to Jupiter Communications' WebTrack. Netscape took in $1.9 million in banner ad revenues in the first quarter, behind only search sites InfoSeek, Lycos and Yahoo!, WebTrack estimates.

In the next few months, Netscape will offer "context specific" banners, a way for advertisers to buy a segment of the Netscape audience.

WHY AOL?

That Netscape tapped AOL to sell ads to consumer marketers is odd; the online service last week hired rep firm Katz Millenium Marketing, New York, to sell its own Web advertising. Netscape said the move was part of a joint marketing agreement to offer the Netscape browser to users.

Netscape named Softbank Interactive Marketing, New York, to sell ads to business marketers, including technology companies. The new agreements mean an end to Netscape's relationship with DoubleClick, a rep firm based in New York.

Ms. Gore said the agreement with NetGravity will give advertisers the ability to track performance electronically and make quick changes. Netscape is preparing for the day when advertisers will insist on Web audit statements as much as they do now with print media; Netscape's endorsement of auditing could hasten that day.

To reach advertisers, Netscape is considering its first trade print ad campaign, via Dahlin Smith White, Salt Lake City.

Contributing: Jane Hodges and Debra Aho Williamson.

Copyright June 1996 Crain Communications Inc.

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