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Microsoft, AOL Score Unilever for Major Ad Deals

Global consumer goods giant Unilever today announced it signed separate three-year Internet advertising agreements with Microsoft Corp. and America Online Corp. under which it will create interactive marketing programs for its major brands.

Financial terms of both agreements were not disclosed.

The move is significant in the Internet advertising space in that it sees a traditional consumer goods leader leveraging the medium to play a key role in its advertising and marketing strategy.

Unilever said the marketing initiative will be run by its Food Group and Home And Personal Care Group of North America. To support the alliances, the company also announced plans to create an Interactive Brand Center in New York City. Unilever said the NY hub will be staffed primarily with Internet marketing employees, as well as Internet and Information Technology experts. Plans call for the project to reach global proportions sometime in the near future, the company said.

Certain to play significant roles in the new interactive ad alliances are Unilever's "house" ad agencies Ammirati Puris Lintas, Ogilvy & Mather Worldwide, and McCann-Erickson Worldwide, all based in New York City. McCann's interactive agency is Thunder House Online Marketing Communications which has worked on Unilever's www.tasteyoulove.com Web site.

The AOL/Unilever venture will focus on the creation of "innovative" Web advertising, and the companies said they will co-develop customized programming and promotional sites. Unilever cited AOL's member base of 12 million member households and 20 million adult members as a significant factor in signing up with the online service.

The company added that it also expects to have a "major advertising presence" throughout The Microsoft Network (MSN) and the Microsoft Web site. The companies said they plan to deploy interactive consumer product ads later in the year.

"Unilever is truly committed to being a leader in the field of interactive marketing and communications, leading us to form these partnerships with the top companies in this field," said Robert M. Phillips, president, Unilever Home & Personal Care - North America. "None of us truly knows how the Internet will change the manner in which consumer goods companies communicate with consumers because this technology is being developed so rapidly. However, we expect that as a result of these alliances, over one billion impressions for our brands will be viewed on the Internet by consumers over the next three years."

Unilever reported 1997 U.S. sales of more than $8 billion. Its well-known product line includes Lipton teas and soups; Wish-Bone salad dressings; Lawry's spices; Ragu; and Calvin Klein cosmetics and perfumes. The company has a Web presence with sites such as www.recipesecrets.com, www.dovespa.com, and www.mentadent.com.

"Unilever's consumers are online in increasing numbers," said Richard A. Goldstein, president and CEO, Unilever United States, Inc. "With these ground-breaking alliances with AOL and Microsoft, the leaders in interactive media, Unilever will now be better able to reach those consumers who are moving away from traditional media."

"In the end, it will be the consumers who decide how they will want to communicate using new media, and we intend to understand that process better than anyone else," said Goldstein.