June 06, 2000
OnMoney.com Holds Spending Steady, Alters Ad Strategy to Focus Locally
By ERIN WHITE, Staff Reporter of THE WALL STREET JOURNAL
As some fledgling dot-coms pull back their advertising budgets and others collapse altogether, consumer-financial-services start-up OnMoney.com is one Internet company that's trying to keep its ad dollars steady: It's spending almost exactly the same on advertising in the second half of the year as it did in the first.
But while spending has held level, OnMoney, has done a midcourse correction in its ad strategy. Chief Executive Vincent Passione says OnMoney is now targeting ad dollars locally rather than maintaining a broad, general-message national campaign. That's a switch from the first half of the year when OnMoney, which launched the site in January, shelled out about $2 million for a Super Bowl ad as part of a $30 million national brand-building push. "When the market collapsed, we took a pause and said, 'Are we being effective? Are we driving revenues?' '' Mr. Passione said of the April plunge in Internet stock prices. "The big change for us is just focus, focus, focus."
Though still not profitable, OnMoney, a White Plains, N.Y., unit of Omaha, Neb.-based Ameritrade Holdings, says it's on target so far with its growth plans. The site had one million unique visitors in April, according to Media Metrix. The company says it has registered 215,000 users so far, and that 40,000 have signed up to consolidate their financial accounts through the site.
In a $25 million ad campaign set to break Thursday, OnMoney will concentrate mostly on seven cities: New York, San Francisco, Chicago, Dallas, Washington, D.C., Boston and Minneapolis. That's where OnMoney thinks it's likely to reach higher-income, Internet-savvy people who may be interested in the site, which offers personal finance services like account consolidation, expense-tracking and bill payment.
To further target its dollars, OnMoney is buying more time and space in New York and San Francisco, with their heavier concentrations of prospective customers than in Dallas and Minneapolis, for example.
The latest campaign consists of two parts: a giveaway promotion of 65 hours of private jet service and a new set of ads that focus more on the site's services. The jet promotion carries the tagline "Escape the Frustration," which the company says ties into the site's ability to help customers do likewise with their money. GW Hoffman Marketing & Communications, an agency based in Darien, Conn., is handling the work for the promotion.
Advertising for the promotion includes some national exposure in such publications as the New York Times, USA Today and Parade magazine. But much of the marketing is targeted in OnMoney's seven selected cities where the company will send out direct mail ads and also set up kiosks in some local airports to tout the jet contest. Marketing for the campaign's second leg, which emphasizes the site's services more specifically, will be even more focused on the selected markets when it rolls out in August. That part of the campaign, handled by Omnicom Group unit DDB Chicago, will include local television, newspapers and direct mail. The company's overall slogan remains the same as in the Super Bowl: "Get your money connected at OnMoney.com." Online advertising will be handled by Saifman, Richards & Associates in Cleveland and Pittsburgh-based Elliance.
Such a locally focused campaign wasn't the strategy OnMoney settled on when it began plotting its latest marketing plan. In strategy sessions this spring, OnMoney executives debated whether they should stick with a broad national campaign or a more targeted local one. But as the dot-com deathwatch swelled on Wall Street and Mr. Passione looked ahead to the end of May when he would start trying to raise $50 million in outside financing, he decided targeting locally would help show potential investors the site was spending ad dollars responsibly. "We did step back and say, 'Are we spending our money as effectively as we can?' '' says Jim Blumenfeld, the company's chief marketing officer. "We opted to go the local route because it was more targeted."
The company is aiming its advertising at three main demographic groups. First are 35- to 54-year-olds making $80,000 to $200,000 a year, people who live comfortably but resent the time that organizing their finances takes away from activities they'd rather pursue. Second are younger people in that same income range, who value education about personal finance as well as the site's promise to save them time. Last are households pulling in $40,000 to $80,000 who value the site's budget-balancing and expense-tracking capabilities.