AOL Says Convergenceis Key to Advertising Success

America Online Inc. has big plans to change the entire paradigm of advertising, Paul Corvino, senior vice president and general manager of Interactive Marketing for AOL, said Monday.

Corvino made the declaration during the opening remarks of ADWEEK Forum at Internet World Fall 2000 in the Jacob Javits Conference Center in New York City.

“Convergence is the next stage,” he said. “This is where the whole paradigm is going to change.”

Convergence, Corvino explained, will enable AOL customers to utilize the AOL service through many touch points, from the PC to television to the radio to the telephone and various other appliances.

AOL has been agressively pursuing these touch points through initiatives like AOLTV, AOL 6.0 — which comes pre-loaded with many AOL “Anywhere” components — AOL by Phone (also supported by AOL 6.0), and products like the AOL/Gateway appliance scheduled to debut later this year.

He explained that these things will eventually make traditional advertising obsolete. He used TiVo as an example, noting that many TiVo users utilize the device to avoid watching commercials.

So what’s the solution for businesses that need to get their messages out to the mass market?

“It’s all going to be more targeting,” Corvino said. “It’s going to be more one-on-one.”

For instance, Corvino said AOLTV is creating more efficient and consumer-friendly placement advertising. “Say you’re watching Friends and you say, ‘I really like the shirt Chandler is wearing.’ You can click on the shirt and it will take you to a site where you can buy it.”

AOL launched its AOLTV initiative this summer and is now gearing up for a massive push of the product through set-top boxes, TiVo and the PC.

“The importance is how this will turn a passive device (i.e. television) into an interactive device,” Corvino said.

Corvino noted that advertising is a three-step process: branding, information and transaction. Traditionally, branding has been accomplished through media like television, print ads and radio; Information has been distributed through brochures and sales representatives; and transactions have been conducted by phone or in-person.

“The Internet is the only medium in which you can do all three in one,” Corvino said.

But Corvino also noted that according to several studies, by far the most important factor to online consumers is convenience. That, he said, is where AOL shines brightest. He said early adopters of Internet technology have disparagingly referred to AOL as Internet with training wheels.

“I personally needed the training wheels,” he said, adding that early adopters “really aren’t representative of the real world. You’ve got to measure it by the mass market.”

That, he said, means that new technology should not be pursued simply because it is new. “We have to find the benefit as opposed to the future.”

AOL, he said, makes it easy for online consumers to find what they’re seeking, even with millions of online venues competing for their attention. He described the rest of the Internet as a gigantic wharehouse where everything is in a box and hard to find.

“AOL is like going to a supermarket,” he said. “You know the aisles and you know where the cereal is.”

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