America Online, the struggling Internet unit of AOL Time Warner
, kicked off a new campaign for its broadband service with commercials during Sunday night’s telecast of the Academy Awards.
The Academy Awards spots, one of which featured a scantily clad Sharon Stone, were the start of AOL’s new push for broadband users. In addition to its own nascent broadband offering, AOL plans to target the broadband users of the telecommunications companies with a “bring your own access” (BYOA) package of add-on services.
“AOL for Broadband,” which is slated to debut at the end of the month, is expected to offer users exclusive video clips, pop-up-blocking software, and parental controls, as well as a new integrated voicemail/e-mail system. Until the end of the year, AOL plans to offer the package to subscribers for $9.95 and non-AOL users for $14.95.
According to published reports, AOL will spend $35 million on the two-month advertising campaign on network and cable TV.
Omnicom’s BBDO designed the Academy Awards spots, along with an earlier AOL Broadband spot running during the Daytona 500. Earlier this month, AOL’s new marketing chief, Len Short, handed the AOL Broadband account to the agency, two months after firing AOL’s longtime agency, Interpublic’s Gotham.
BBDO has done away with AOL’s long-running tagline, “So easy to use, no wonder it’s No. 1,” in favor of the punchier “Welcome to the World Wide Wow.” The spots are meant to give AOL a more sophisticated look, emphasizing the advantages of high-speed Internet users purchasing its services.
With the emphasis on BYOA, the long-running battle with MSN for dial-up users appears to have shifted. MSN confirmed last week that it would alter its strategy away from battling AOL to be the largest ISP. MSN is a distant second in terms of U.S. subscribers, with 8 million to AOL’s 35 million.
The shift in focus by both companies comes just months after they debuted new Internet service offerings with splashy launches. AOL arrives quite late with a competitive broadband offering. New AOL chief Jonathan Miller has tagged the task of moving the company’s subscriber base from dial-up connections to broadband as a key to turning around the company
While AOL remains far and away the largest ISP, just 600,000 of its customers access the Internet through AOL Broadband, despite the explosive growth in broadband connectivity in the past couple of years.
According to Nielsen//Net Ratings, about 33.6 million U.S. consumers had broadband access at home in December 2002, a 58 percent increase from a year ago. Yet AOL, which holds 35 percent of the dialup market, has a tiny slice of this much more lucrative market.
On top of that, AOL’s U.S. subscriber base actually shrank by 176,000 during the normally robust holiday season, as more and more customers sought out broadband connections.
The new ads use humor to extol the benefits of AOL services, including its instant messenger and pop-up-blocking software. AOL rolled out its pop-up blocker two weeks ago, after users pegged the ads as a major annoyance.