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Where did TV's e-tailer ads go?

www.flashinthepan.com

graphic
A recent eToys.com commericial shows a child fascinated by the carwash. His dad is inspired to buy a toy version for his son from eToys.com  

In this story:

Fewer e-tailers

Old retailers back


RELATED STORIES Downward pointing arrow


LOS ANGELES, California (CNN) -- Scroll back a year ago, when dot-com companies filled the TV landscape with commercials.

Every flick of the remote turned up another Technicolor, bombastic pitch by an e-commerce company. It got so crazed that the Pets.com sock puppet became a minor cultural icon.

What a difference 12 months can make!

 VIDEO
CNN's Paul Vercammen reports on ad campaigns by E-tailers and traditional retailers this holiday season

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Turn on the TV now and most of the cyber retailers are dot-gone. Call it death of e-salesmen.

"The stock market bust for the dot-coms is a big part of the reason why you are seeing less dot-com advertising on television," says Stephen Battaglio, senior TV editor at Inside.com, an online media site. "If it's a choice between what the marketing guy wants and the financial guy wants, the financial guy is going to win every time."

The marking twist of fate this year is the practice of established shopping stalwarts buying commercial time and showcasing their own online shopping sites. At the very least, Target, Best Buy and Wal-Mart are alluding to their sites in ads this shopping season.

"This will be a good Christmas (shopping season) for the traditional retailers' Websites, and a rather challenging Christmas for the pure ... e-tailers," predicts Brad Johnson, deputy editor at Advertising Age magazine.

Fewer e-tailers

graphic
Traditional retailers are now showcasing their own online shopping sites, such as Target.com  

Dot-com retailers, with less money to play with this year than last, are currently spending a lofty average of 65 cents on marketing for every dollar of revenue, Johnson estimates. That sum, while hefty, is nothing like last year's estimated cost of $1.09 spent for every $1 of revenue, he says.

With margins like that, some e-tailers did not survive the year.

One survivor, eToys, is now running a spot featuring a cute kid deftly stacking asparagus stalks. Mom and Dad observe his passion for building, go online and buy him a toy construction set.

Such spots will cost eToys around $25 million this holiday shopping season, the e-tailer told CNN.

"We're spending about the same as last year," Janine Bousquette, eToys' chief marketing officer. "We're doing it (airing TV commercials) because it was very effective for us last year in terms of establishing awareness and driving people to our site."

This may be a do-or-die advertising gamble for eToys. The company's stock has skidded like a toddler on a wet floor, from a 52-week high of $61.50 to $1.44 a share on Monday.

eToys' rivals, meanwhile, are getting more Web savvy, including Toys R Us. It has hyperlinked with online sales powerhouse Amazon.com.

Toys R Us commercial spots suggest you click on its Website, buy goodies, and wait while Amazon's warehouse full of shipping experts send you the holiday cheer on time.

Old retailers back

Commercial spending by Toys R Us, Target Stores, J.C. Penney Co. Inc. and other old-economy retailers is helping the networks get through an advertising market made soft, in part, by dot-coms' reversed fortunes.

"The networks are happy to take money from anybody," says Battaglio, "so long as they are willing to pay the price."

With less competition, say some advertising and network insiders, rates for commercials may head south. There's even talk that the dot-coms' departure from the advertising field may mean the price of a vaunted Super Bowl commercial may actually remain unchanged, reversing a long, upward spiral.

In the next Super Bowl, say the experts, don't look for commercials to cost more than the record $2.2 million charged for 30-second spots in Super Bowl XXXIV.

Nor should you look for many of those e-tailers' spots during the game or elsewhere. This year promises to be quiet, one year after dot-coms made all that racket with flashy TV commercials and blabbering pet puppets.

The market has reasserted itself, and in the process told those e-tailers to stick a sock in it.



RELATED STORY:
Dot-coms wrestle with present, look to future

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