Tesco buys into iVillage online women's network

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By: Wise Marketer Staff |

Posted on March 24, 2003

Tesco buys into iVillage online women's network

The UK supermarket chain, Tesco, has bought out the online women's community, 'iVillage'. Following the sale, iVillage becomes a wholly-owned subsidiary of Tesco, and will be subject to a 20-year licensing agreement for content and intellectual property, including trademarks and copyrights.

The deal follows the firm's recent launch of the MeTime women's reward category as part of its Club Card loyalty programme. Tesco's MeTime programme is aimed at helping women to pamper themselves by using Club Card points for luxury treats such as hair styling and make-overs.

iVillage is an online community for women, with a variety of information and interesting activities to take part in, including discussion groups, job seeking, health advice, and even a baby name chooser. The online community focuses on issues that matter to women, and offers interactive services, expert advice, and a support network.

Other content channels currently include: diet and fitness, relationships, parenting, pregnancy, health, beauty, food and drink, money, news and entertainment, work and careers, astrology, computers and the internet, shopping, games, and motoring.

Under the terms of the agreement, the iVillage online community will continue to operate under the iVillage UK name, and will continue to provide its 1.2 million visitors each month with consistent information, articles, and offerings.

Cross marketing The expansion of the relationship between the two companies also gives Tesco the ability to use iVillage to cross-market and interact with its other communication channels, including the Tesco.net internet service provider (ISP) as well as its bricks-and-mortar stores.

"We have successfully exploited combined brand equity and customer loyalty to capitalise on the growth of the online women's market in the UK," explained Tesco.com's CEO, John Browett. "Of all the potential online media partners, iVillage had a clear lead in community-based content. The site's growth will enable us to establish and grow meaningful, lasting relationships with our customers."

Marketing support Although iVillage will continue to operate under its own branding, the online entity is expected to receive significant marketing and promotional support from Tesco to help drive qualified traffic, and to promote itself within the UK.

Tesco's online and offline promotions have historically comprised in-store promotions, direct mailing, and positioning on both the Tesco.net (ISP) and Tesco.com (home shopping) web sites. It is expected that iVillage will appear in a combination of these promotional media, and reciprocal advertising has already begun.

The license agreement is structured so that the site's existing operator, iVillage UK Ltd, will receive either a set monthly fee or a percentage of gross revenue, whichever is greater.

"Our agreement with Tesco creates a new stream of revenue for iVillage, and more deeply establishes our position as supplier of women's information," concluded iVillage CEO, Douglas McCormick.

For more information: ·  Visit iVillage UK at http://www.ivillage.co.uk ·  Visit Tesco Plc at http://www.tesco.co.uk