AOL's Marketing

America Online (AOL) offers subscribers on-line content through their personal computers and phone lines. The company competed against CompuServe and Prodigy in the early 1990s, but these competitors are no longer in the market and AOL has more than 10 million subscribers (Sacharow 35). By offering competitive pricing and content which had mass market appeal, AOL built its customer base. The company now faces a challenge as increasing numbers of companies are offering high-quality content through their Web sites without charge. So long as consumers can access the site, they can receive the content. AOL is seeking to avoid becoming merely an Internet service provider, and is positioned, at this time, to continue to provide content. This research considers the company's marketing strategy and its future direction.

AOL has as its objective nothing less than to be the premier provider of on-line access and on-line content in the world. AOL currently serves consumers in more than 100 countries, and is looking to expand its global reach. To accomplish this, the company is focused on enhancing its content through affiliations with third-party providers as well as its in-house development efforts, and continuing to enhance its infrastructure to provide better access to AOL services (1997 AOL 10-K SEC Filing 2).

AOL provides a variety of on-line content to its subscribers as well as Internet access through its Web browser

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s such as AOL are also looking for ways to increase the transmission rate of their connections and to offer more information through wider bandwidths. Thus, even while the company's distribution is limited, the strategic choices available to the company from this standpoint are not (Hamblen and Wallace 28). AOL uses traditional promotional strategies combined with new technology to build market share. Television advertising is supported with direct mail, and inserts are used with magazines that target high-technology users. However, where product information cards would once have been the medium of choice for product inserts, AOL offers a disk giving the user a predetermined number of free hours (usually 50) during which the consumer can try out the various features of AOL. The company also actively markets to its corporate partners in order to garner additional revenue from this highly lucrative source. Corporate sales are built on personal selling and long-term contracts (Baker 7). AOL has not been an innovator when pricing its product line. For years, it followed the market and priced access to its service at a fixed rate for a given number of hours (usually ten per month), then a per-hour rate. It encouraged the use o

Category: Business - A