Internet powerhouse eBay (Nasdaq: EBAY) and media giant AOL Time Warner (NYSE: AOL) struck an expanded marketing agreement that more closely links two ofthe most powerful brands on the Web, and stretches into television and print media.
Under the deal, San Jose, California-based eBay will advertise across AOL Time Warner’s sprawling media empire, including the TNT and TBS television networks, magazines such as Time, Fortune and People, and Web properties such as CNN.com and People.com.
The deal comes two weeks after AOL announced it would invest US$100 million in and strengthen its ties to leading e-tailer Amazon.com (Nasdaq: AMZN).
The expanded agreement between AOL and eBay extends a relationship that dates back to 1997. The deal maintains AOL’s position as eBay’s “exclusive third-party advertising sales force, representing a significant portion of eBay’s standard online advertising inventory,” the companies said.
Financial terms for the expanded agreement were not disclosed. In 1999, eBay agreed to pay AOL $75 million for promotion across the Internet service’s online properties.
Must Be Giants
At least online, AOL and eBay have grown to comparable strength since that time, with AOL now boasting 33 million members worldwide and eBay’s community about 34 million strong.
“Our relationship over the years with America Online has been a huge success,” said eBay president and chief executive officer Meg Whitman. “Working across AOL Time Warner’s tremendous assortment of media properties will allow us to bring eBay to more consumers than ever before.”
According to Whitman, the increased brand awareness and traffic that the AOL deal will generate for eBay will give the entire eBay community a boost.
AOL chairman and chief executive officer Barry Schuler said that the deal adds eBay to the “growing list of top companies” that have expanded alliances with AOL. Schuler also called eBay “one of the great innovators in online commerce.”
Crossing the Channels
In signing the eBay deal, AOL is taking another step to leverage the massive media empire created when Time Warner and AOL merged. As with the Amazon agreement, the eBay deal is a nod to AOL’s roots as an Internet service provider and Web portal.
Other portals, facing an advertising crunch, clearly hope to follow suit. For example, alhough Internet-only at its core, Yahoo! has stepped into the multichannel arena, inking a marketing and Web development deal with Sony last month.
Yahoo! has also joined with NBC to develop a television-and-Internet shopping channel.