In the race to become America's second starting point on the Web — and consequently an ad-dollar magnet — Planet Direct is betting on a partner network of Internet service providers sporting its personalized content as the key to building an audience that marketers will covet.
Last week, Planet Direct, Andover, MA, launched a $1.2 million co-op ad campaign with its largest ISP partner, Erols Internet, Springfield, VA, to bolster Erols' subscriber base and, therefore, Planet Direct's viewership.
To date, advertiser-supported Planet Direct has struck partnerships to provide content to 250 small- and medium-size ISPs. As a result, the 2-year-old firm's content is the first thing 500,000 ISP subscribers see when they log onto the Web.
The easiest way to shed light on Planet Direct's business model is to explain a key point about America Online: AOL's proprietary service isn't on the Internet. It is an AOL-controlled system with a variety of services (news, shopping areas, chat rooms, etc.) that includes a gateway to the Internet.
Since AOL content is the first thing its subscribers see — and many never venture further — it's hot property for sponsorships.
Planet Direct maintains an AOL-like proprietary online service for other ISPs in the hopes that the audiences of many ISPs will someday equal one AOL.
However, proprietary content isn't the only way to become a Web starting point. Internet users whose connections offer no proprietary services, like those accessing the Web from work, start on an easily-but-rarely changed default home page programmed into their browser software — Netscape Navigator's Netcenter (http://home.netcenter.com), for instance. Search engines also are Web-portal contenders.
As a result, the race is on to see who besides AOL, with its 11 million members, can claim Internet launch-pad status to potential advertisers. Those jostling include heavy hitters such as Netscape, Yahoo, Excite and CNET's Snap Online. Also, Microsoft reportedly is set to launch Microsoft Start — a super Web site showcasing all its current online offerings — in the summer.
“In another year, you won't be able to get on the Internet without someone having thought very hard about what your home page will contain,” said Terri Henry-Ford, marketing communications manager at Planet Direct.
Erols Internet offers its 320,000 members a choice: Planet Direct's content or a simple connection to the Web. Orhan Onaran, Erols' president, said 22 percent of the company's members opted into Planet Direct when Erols introduced it last spring, and about half of Erols' new members choose the service.
“We offer Planet Direct to reduce churn,” he said.
To entice new ISPs into its network, Planet Direct has packaged an Internet start-up kit on CD-ROM for ISPs to pass onto their customers that includes an Internet tutorial and http://my.planetdirect.com as its default home page.
Henry-Ford said Planet Direct is negotiating for default home-page status with seven or eight companies, including existing ISPs and communications companies planning to offer Internet service.
“Like anyone in the Internet business right now, there's no one we're not talking to,” she said.
Planet Direct is banking that its approach to building a member base will create an audience more appealing to advertisers than its more heavily trafficked competitors.
Subscribers are encouraged to personalize their home pages by indicating topics of interest. In turn, Planet Direct gives them information and services tailored to their interests and localized on a city level. As a result, Planet Direct offers advertisers banner-ad targeting by geography, gender and 15 consumer categories, including food and drink, money, sports, travel and health.
The company also sends 275,000 of its subscribers an e-mail newsletter on which sponsorships are available. For merchants interested in lead generation and e-commerce, Planet Direct has “Planet Direct Offers” and “Marketplace” areas on its home page.
Among the marketers prospecting on Planet Direct Offers is Omaha Steaks, Omaha, NE. Stephanie Healy, interactive sales manager at Omaha Steaks, declined to say how many leads Planet Direct has delivered.
“There hasn't been enough time yet, but the deals they're working on indicate that they're headed in the right direction,” she said.
Henry-Ford said Planet Direct plans to have 1 million members by July.