By M. Suyanto
Based on Media Metrix survey in 2000, 500 world top companies according to Fortune magazine increase their activities and contribute more than the previous years for advertising revenues on the Internet. 500 companies have web sites and all use online advertising. One-to-one advertising, the target marketing, can be very expensive; however, it offers the promising profit of advertising. According to Taylor (1997), a successful target marketing was very effective for Lexus cars, one of which cost 169 dollars by then. Furthermore, the cost of advertising directed at communities proved to be more effective than that of advertising directed at individuals. One community on the Internet is considered to be the community of a certain interest. The interest community consists of the people who interact with the same interests, for example, interests in entertainment, family, estate, weather, and so on. The example of a successful company that performs the marketing directed at the community of an interest is N2K, a company engaged in the music industry. N2K developed relatively quickly after joining the Telebase, which runs an Internet music store (www.musicboulevard.com). This site contains information which varies in accordance with its visitors’ interests, for example, interests in artist biographies, tour schedule, music samples, and the study of music. In addition, N2K also sells CDs, T-shirts and accessories. N2K income reached 85,000 dollars in the first three months after merging with Telebase. According to N2K, one Web site is not enough for the entire music interest community. Therefore, N2K segmented the music interest community more specifically according to the types of music, namely jazz music (www.jazzcentralstation.com), classical music (www.classicainsite.com), and rock music (www.rocktroplis.com ). N2K income rose rapidly from 85,000 to 450,000 dollars in three months, and 3.6 million dollars in one year later. To compete with Amazon.com and to become the largest online music store, N2K merged with CDNOW. Analysts said that the merger of the two online music retailers marked the increasingly stringent competition of online music retailers. According to the report of The Wall Street Journal, the merger of CDNOW and N2K with the brand CDNOW (www.cdnow.com) dominated the market around 45% or about 1.2 million customers. N2K and CDNOW spent a lot of money to compete with Amazon.com. Finally, N2K merged with America Online, Ntscape, Excite, and webtv while CDNOW merged with Yahoo and Lycos.