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New Camry buys VIP push from AOL TW

Aug 27, 2001  •  Post A Comment

Toyota is the latest cross-platform advertiser at AOL Time Warner, self-described as the “world’s first Internet-powered media and communications company,” which has made synergy and The Higher Value Proposition its twin mantras.
The new deal with the Japanese automaker will launch the 2002 Toyota Camry on a variety of AOL TW platforms, including TNT, where Toyota will sponsor the “Come Together: A Night For John Lennon” concert in October; CNN, where Toyota will sponsor a “Music on the Road” feature in “Showbiz Today;” Time magazine, where Toyota will be lead sponsor of a special “Music Goes Global” issue in September; and America Online, where Toyota’s new auto will be promoted on the services’ Autos Channel as well as in the autos areas of Netscape and CompuServe and at Time.com.
In addition to the Toyota deal, AOL TW has done cross-platform deals with the following companies since its creation last January: AT&T Wireless, Bank of America, Cendant, Cisco Systems, Compaq, Continental Airlines, eBay, Foundry Networks, Kinko’s, Nortel, Oxygen Media, Philips, Princess Cruises, Qwest, Samsung, Swatch, Worldcom and Wrangler.
When AOL TW was formed, it created an ad council to oversee and coordinate its cross-platform marketing. The council is composed of approximately a dozen senior sales executives from around the company, including licensing, music and movie executives as well as those from the various publications and the TV networks. The Ad Council is chaired by Mayo Stuntz Jr., executive VP of AOL TW.
Now AOL TW has created the Global Marketing Solutions Group, headed by Myer Berlow, its president, who reports to both the Council and Bob Pittman, co-chief operating officer of AOL TW. The GMSG is composed of approximately 30 sales and marketing people from the company’s various divisions.
The reason the GMSG was created, Mr. Berlow said, was to focus even more on the kind of cross-platform deals that the company’s leaders believe will transform advertising and marketing. “The strength of this division will be if we’re able to go beyond just selling pages and ads,” Mr. Berlow said. “The strength of this division will be if we can put together synergistic, interactive programs that substantially change the marketer’s profitability and productivity.”
This is the so-called Higher Value Proposition. “The way it works is as follows,” Mr. Berlow said, outlining a three-step product-marketing process, which consists of branding, giving more information and closing the transaction. According to Mr. Berlow, in the aggregate, the giving-more-information phase of this process is twice as big as the $240 billion U.S. branding marketplace.
“Take a look at a car manufacturer,” he said. Mercedes Benz, for example, is “worried about the [costs per thousand] of a TV commercial, but then you walk into a Mercedes Benz dealership and he hands you a $2.50 brochure which then has a $2,500 cost per thousand.”
Mr. Berlow proposes to save the prestige automaker-and by extension any “high value” product category with a costly promotion and distribution system- big dollars by putting its promotions and that expensive brochure as well as its big-overhead ordering and distribution processes online.
If just 10 percent of the give-information process happened online, and if the process of configuring an individual automobile order (specifying color, appointments, features, etc.) happened online as well, Mercedes would save $2,500 per car, Mr. Berlow said.
Within a year, said Mr. Berlow, the GMSG will “demonstrate the promise of the merger in terms of advertising, e-commerce [and] marketing synergies.”
At AOL TW, “you have cable, you have online, you have magazines, you have custom publishing, you have movies, you have licensing, you have sports teams,” Mr. Berlow said. “You have all of those relationships in addition to 130 million subscribers [to, among other entities in the corporation, AOL, Time, HBO and Time Warner Cable].”
Mr. Berlow has been with America Online since the mid-1990s, when he was AOL’s vice president for national accounts, and one of his clients there was Time Warner. In fact, he recalled, “They were the first client that fired us … Time left, and we took Newsweek, but we also had a very long-term successful relationship with Warner Bros.”