New Microsoft Ad Campaign Targets AOL
Microsoft Corp. on Sunday ratcheted up its attack on archrival America Online with a $150-million television and print advertising campaign that paints the MSN online service as a rich and easy-to-use alternative to market leader AOL.
The Microsoft campaign, designed by the McCann Erickson advertising agency, will be the company’s most expensive domestic consumer advertising push yet. By comparison, Microsoft spent $200 million to launch its Windows 95 software program to consumers and businesses worldwide.
The new ads, launched during Sunday’s NBA All-Star Game on NBC, revolve around four consumers who use the online service to obtain essential goods and services after moving into an empty house.
The spots position MSN as a solution for consumers’ real-world Internet needs. They also introduce a new MSN logo, a colorful butterfly, and a new tag line, “the everyday Web.”
With 2.5 million customers, MSN badly lags market leader AOL with its 20 million subscribers. Given AOL’s pending merger with Time Warner, some Internet observers say, it’s doubtful whether MSN can ever catch AOL.
“Clearly, there’s no compelling reason for consumers to make the switch to MSN right now,” said Peter Clemente, a vice president with Cyber Dialogue, a New York-based market research firm. “Microsoft needs to seriously consider a strategy that focuses on a vertical category--say, small-business users. Or maybe they focus on their existing customer base--which is slightly older, more technically able.”
Microsoft envisions the ad campaign as a crucial element in the company’s long-running effort to turn MSN into a top-flight alternative to AOL.
“We’ve put a phenomenal amount of time and money into making the online experience easy and accessible,” said MSN marketing director Yusuf Mehdi. “This advertising campaign definitely will allow us to send a clear, distinct message relative to AOL and the others.”
MSN clearly is targeting AOL’s customers.
“AOL is sort of like the Internet with training wheels,” Mehdi said. “Training wheels are great when you’re beginning, but you wouldn’t keep them on once you learn to ride . . . and the same thing is true with the Internet.”
AOL could not be reached for comment.
MSN’s advertising push is “a vital part of our plan because awareness of MSN is low,” Mehdi said. “People haven’t heard a lot about MSN, so the ads are the last missing piece. We expect it to be a great success.”
AOL traditionally has spent relatively little on advertising, but its direct-marketing expenditures--including CDs mailed to consumers--push overall customer acquisition spending to an estimated $500 million annually.
Microsoft will match AOL’s customer-acquisition spending, Mehdi said. “We’re going to roughly double their advertising budget and we’ll be spending hundreds of millions more beyond advertising to capture customers,” he said.
In a twist, the ads launched Sunday mimic a real-world trend: people moving into new homes and using the Internet to obtain everything from furniture to food.
“We think that’s good because it shows that you really can use the Internet to make your life better,” Mehdi said.
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Top Web Sites
Here are the top Web sites among home computer users the week of Jan. 25-30.
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Indiv. Time users per person Property (millions) (hrs/min/sec) 1. AOL Web sites 26.1 0:12:47 2. Yahoo 22.8 0:27:12 3. MSN 15.5 0:26:12 4. Lycos Network 10.0 0:12:17 5. Excite@Home 9.0 0:15:47 6. GO Network 7.4 0:12:06 7. Microsoft 6.0 0:06:26 8. NBC Internet 5.4 0:08:17 9. AltaVista 4.6 0:12:49 10. EBay 4.3 1:03:58
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Source: Nielsen/NetRatings
