Success= What You Know + Who You Know.Com

Selling to Kids, Sept 1, 1999

When you're a medium-sized player and you're up against major ones like Disney and Fox Interactive for the same online eyeballs, snooze and you lose. But schmooze - form smart partnerships - and you've got a shot at your share.

I. Hoffman associates Inc. (H a) credits strategic crosspromotions, increased and enhanced Web presence, and expansion into other media with reaching its goal: heightened international awareness for Nikolai and Neow-Neow, its branded characters. Those strategies are in place to work toward the company's mission: "If [kids] think Internet, they think Nikolai," says Isabel Hoffmann, CEO, president and author, H a.

The characters, first developed for a growing CD-ROM series, are the cornerstone for the company's Internet and e-commerce presence that's also growing. Word's getting out with the help of some partnerships. Last August, H a licensed four CD-ROMs to Shingakusha Co. Ltd., a Japanese educational publisher. It also reached a licensing agreement in Poland, with distribution extending to Australia. And, last September, H a agreed to develop and produce CBS Kidshow Online through www.cbs.nikolai.com and Kidshow@nikolai.com.

It was also in September that Nikolai's Clubhouse, a membership community, launched on nikolai.com. And H a inked deals to do a kids' channel on Netscape Netcenter in November (nikolai.netscape.com) and on Canada's biggest portal in February (canoe.nikolai.ca).

Four TV ads running every Saturday morning on CBS Kidshow from November to January used a sweepstakes to drive kids to the cbs.nikolai.com. There, they could enter to win a trip to New York and a toy shopping spree. Participation in Lycos' CyberSurfari treasure hunt also drove traffic to the CBS Nikolai site, where a clue was hidden.

All this activity has resulted in very healthy numbers. The CBS-Nikolai launch drew 22,000 unique visitors, a number that grew nine-fold in three weeks. By March, the site had more than 5 million page impressions per week. Now the number has multiplied, to 12 to 15 million impressions, and it's growing every month, says Hoffman. The launch also inspired another project: H a and CINAR Corp., which develops and produces animated programming, are co-developing a TV animation series based on the characters.

Improving on, Measuring Success

In June, the Nikolai site was relaunched in a new format. It went from HTML to ASP coding, which, says Hoffman:

* lets the company modify and update the site every day.

* lets "us focus on creativity instead of on coding. Coding by designers was pathetic," she says. The move, in turn,

* helps to retain employees (turnover is a huge issue in the online industry, she says, and employees who get to do what they're good at tend not to leave), and most of all,

* led to a more compelling site, incorporating more interactivity and customization than was possible before.

The relaunch has resulted in increased "stickability," says Hoffmann. Visit lengths average 22 minutes, double last year's. Along with the passing of time and the growing volume of word of mouth, the relaunch also helped to punch up page impressions. From mid July to Aug., they went from 18 million to 20 million. The top games are played more than 2,500 times a week, she says. More evidence of a campaign that's working: Ten thousand people responded to an online survey, which asked mostly about online frequency and origins. For example, the study found that AOL is the source of 61% of nikolai.com's traffic.

One survey question about preference, "what's your favorite toy?," should be useful to the online store - www.store4kids.com - which, when it relaunches in two weeks, will focus more on toys than it has in the past. It won't surprise you that Pokemon's the answer of most respondents, says Hoffmann, "cards, games, everything." Nintendo, Furby and Barbie also made the list. Nikolai and Neow-Neow will take up space on the virtual shelves soon. The company's finalizing a master-toy-license deal.

The CBS site, for which Hoffmann says "we need to generate traffic," will also relaunch later this month. She expects traffic to increase from one-half million to 2 million impressions when CBS goes back on live on Saturday morning, including spots that point to the site, which will use the same ASP programming that H a used for nickolai.com.

Hoffmann finds the effect of TV advertising on Web site traffic significant. "Although Forrester [Research] found that 33% of kids in North America are turning off TV to go online, the linking of the two is important," she says. She's anticipating the popularity of broadband TV, which will allow surfing and shopping on the Web on interactive TV: "t-commerce," as it's been dubbed. That emerging technology is "why we aligned ourselves with CBS," she says. Also in anticipation, H a has adapted its CD-ROMs to broadband.

Speaking of CD-ROMs, the company hasn't forgotten its roots. "Nikolai's Treat," the eighth title in the series, will launch in two weeks, with a ninth "Nikolai's Judges" due next spring or fall, depending on the condition of the spring market, tested by looking at demand from retailers and distributors, says Hoffmann.