iVillage Cuts Coupon Deal

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SuperMarkets Online Inc., the online arm of in-store marketer Catalina Marketing Corp., announced last week that Internet firm iVillage.com: The Women's Network is distributing SuperMarkets Online's Internet coupons. The agreement comes on the heels of several high-profile deals between big-name Internet firms and direct marketing companies.


For about two weeks, Supermarkets Online's "ValuPage" coupons have been available on www.ivillage.com and on AOL at keyword: ivillage.


Neither company would release response to the program so far, or financial details other than that New York-based iVillage's end of the deal is heavily tied to performance. iVillage claims it receives more than 77 million page views per month and that it has more than 850,000 unique members. iVillage's membership is also SuperMarkets Online's main target -- women.


"Distribution is king for us right now," said Will Gardenswartz, senior vice president of marketing and business development, SuperMarkets Online, Greenwich, CT. "iVillage.com has an unparalleled consumer base with women, both at home and at work."


iVillage sends about 50 e-mail newsletters to 5 million women on a weekly basis. The company will promote the ValuPage program "where there is a logical member base and need for it," said Jason Stell, spokesman for iVillage. "We're talking about a big universe and we have a clear market lead in the [women's] space."


As for the ValuPage program, SuperMarkets Online launched it in January and has signed on 40 manufacturers, including Nabisco and General Mills.


To participate in ValuPage promotions, consumers enter their ZIP codes at www.supermarkets.com to get a list of participating local retailers. Once the consumer chooses a retailer, the Web site returns a "ValuPage" with a single bar code and a series of offers valid for the current week using "Web Bucks" as the reward (as in "Buy any package of Huggies diapers and earn $1.50 in Web Bucks" ).


Consumers print the ValuPages on their home printers and give them to cashiers during checkout. When the bar code is scanned, a printer attached to the cash register produces a corresponding number of Web Bucks for each ValuPage product in the cart. The Web Bucks are redeemable for discounts on


any purchase made -- excluding milk, liquor and tobacco -- on the next visit to the store.


SuperMarkets Online says 8,500 stores accept Web bucks and that it sends e-mail to more than 500,000 people each week. Gardenswartz estimated that the iVillage deal will boost SuperMarkets Online's distribution by 50 percent within several months.


iVillage's agreement with SuperMarkets online is another in a recent string of deals between companies not normally associated with direct response, and more traditional direct marketing firms.


In November, Excite (www.excite.com) reached an agreement with specialty cataloger Hanover Direct Inc., Weehawken, NJ, to offer Hanover products in a catalog department. At the same time, search engine Alta Vista (www.altavista.com) began working on an opt-in e-mail list to be developed and managed by New York-based e-mail list development firm NetCreations.


In October, Santa Clara, CA-based Web titan Yahoo announced it had agreed sweepstakes direct marketing firm Yoyodyne.


"The [Internet] is direct marketing," said Gardenswartz. "If you think of it only as impression-based, you miss the magic of the medium," he said.


Gardenswartz added that SuperMarkets Online is also negotiating to get ValuPages on some of the Internet's other large properties, though he declined to name any or give a time frame. "There will be a portal deal," he said. "It's going to take more than an iVillage deal to put a dent in the [free standing insert] business," he said.


So far, Internet coupons have barely scratched the surface of their potential, said Gardenswartz, adding that ValuPage reaches about three percent of the Internet audience monthly. "A lot more than three percent of the Internet audience is interested in coupons, I guarantee you, but that's exactly why I have to chase down a portal deal," he said.
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