An idyllic city located in northeast Florida, Gainesville is known for many things, including the prestigious University of Florida, the state's oldest and largest university, which opened in 1853. Lesser known, perhaps, but of great import to fans of online porn, is the city's resident adult content provider. In late '96, at a time when the adult Internet was first exploring the concept of niche marketing, Kim Nielsen launched ATK, an adult entertainment Website trumpeting softcore and hardcore teen content.
"I was in a Ph.D. program in marketing at the University of Florida at the time I started ATK, and was looking for ideas for research projects at a conceptual level and trying to assess the general viability of using the Internet as a research tool," says Nielsen, ATK president/CEO. "The adult arena was something I stumbled on by chance while surfing the Internet, but I was quite surprised at the traffic levels some of the adult Websites were able to achieve."
Because the adult industry at the time was, according to Nielsen, "in the introductory phase in terms of product life cycle development," he recognized the opportunity "to do a better job of segmenting the marketplace and meeting consumer needs."
The Web project also supplemented Nielsen's research stipend at the university; it was necessity and ingenuity coalescing at the right time. "When I surveyed the adult market in '96 it seemed that two popular niches were ?amateur' and ?teen,'" says Nielsen. "Our initial market segmentation was ?amateurs,' ?teens' - which we now call coeds - and ?babes,' my term for more glamorous, less amateur-looking content. Initially we tried to focus on the 18- to 23-year-old college women, while offering those afore-mentioned breakdowns."
ATK projects manager Brent Axford believes the fusion of new technology and a large population of young adults makes the coed niche a natural draw for customers. "Adult entertainment appeals to the fantasies of the surfer, and many of these young adults dream of being with a gorgeous blonde 19-year-old," he says. "On the other hand, many older men try to relive their youth through the viewing of this niche."
He adds, "College for many is a time when people have many of their most powerful experiences in terms of growing up, choosing a career and also experiencing the opposite sex. So college-age women are often a strong attraction for that reason."
Axford said the "talent pool" to find models is plentiful in the coed market. "Many girls are looking to explore their sexuality," he says, "and may need assistance to make ends meet with rent and/or school."
Where Webmasters are concerned, Axford deems it an issue of supply and demand. "If the surfers are begging for coed content, you are going to provide it for them as long as it offers you the greatest profit margin on your traffic," says Axford, a one-time Xpics consultant. "If the client didn't want your product, you would offer what they do need and want. The pure supply of content available for purchase of coeds makes it more attractive to many Webmasters looking to keep their expenses to a minimum."
Today there are five sites that fall under the ATK banner: ATK Galleria, ATK Natural and Hairy, ATK Exotics, ATK Archives, and ATK Lounge.
Each site is blessed with a wealth of content, from the seemingly infinite number of movie and photo galleries spotlighting fresh-faced beauties, to video feeds, stores, links, programs, and more. The ATK Lounge is a comprehensive community hub for members and includes games, site/movie/ book reviews, updates, quizzes, contests, free pictures, articles, etc.
No content is produced in-house. In fact, ATK works with dozens of photographers worldwide. "We have a healthy exchange of ideas in order to allow them to provide us with a variety of material that can be used in our sites, and which will be well-received by our customers," says Nielsen. "We carefully read e-mails from customers, track the popularity of various photographers and models in our sites, listen to ideas from our resellers, and review questionnaire data about content collected in our ATK Lounge in order to determine what we need to provide to our customers.
"It's the focus on the customer and our application of sound marketing science principles to our work that's allowed us to provide an excellent value and service that meets consumer needs."
Jamie Wentz, ATK vice president, is overseeing an upgrade to production techniques which involves automating many steps, starting from receiving the photo shoots to the final linking of the updates. "This will allow us more time to implement changes on each of the Websites in order to continue to move forward with the demands and requests of our members," he says. "We are always monitoring the quality of the final product, and we have just raised the standard again in order to continue to improve our product and brand name."
Axford believes a surfer knows they're receiving quality product, service, and price on their membership when they join ATK. "We never promise what we can't give, and I believe that goes a long way in their minds," he says. "Customers who feel they are being treated with respect, and feel that their voices are being heard, will remain loyal."
Nielsen cites "prompt and courteous customer service" as vital components of ATK's business philosophy. "We put a lot of emphasis on managing supplier and business partner relations in an honest and fair manner," says Nielsen, who worked at General Motors as an analyst in a group called Advanced Marketing Methodologies, which was responsible for developing new techniques for market research. "We have a long-term focus in our dealings with customers and business partners, and carefully monitor customer satisfaction and our brand image in the marketplace, aiming to maximize long-term brand equity for our firm."
Nielsen says ATK is very careful when it comes to managing their brand image and equity. He notes that steady monitoring of customer feedback directs any strategy for improvement.
"We have thought through all the things we want ATK to stand for," says Nielsen, "and are also cognizant of the danger of going beyond our areas of strength and expertise. The changes we make are all very well-planned and designed to build and improve on consumer confidence in certain areas before we try to venture into further brand extensions."
Nielsen defines "brand extensions" as successfully expanding ATK's portfolio. He says customer confidence has allowed such product development. "From a reseller standpoint, we have been very selective about those we admit to our program. We do not want to dilute the efforts of our resellers and saturate the market with our program, preferring to keep some degree of exclusivity associated with the ATK brand name. Therefore our focus until now has been much more on what ATK stands for to customers rather than to Webmasters."
Not that Webmasters aren't important to them. Heading up the revamped ATK Cash affiliate program is Dameian Lott, who says the program is a "huge leap forward" for ATK. Program additions include hosted galleries, free content, a comprehensive stats package, cascading credit card billing, and new billing options.
"We're using the MPA2 back end which allows us to provide our affiliates with a wide array of tools and new billing options," says Lott, a onetime chief Webmaster for Xpics who left the company because he did not agree with some of their business practices. Lott spent a short time at Cybererotica before returning to Florida to run his own sites and later join ATK.
There is no magic charm for building successful, high-quality Websites, but Nielsen says factors such as researching the marketplace and finding a target segment to pursue are essential. "The focus on the customer is key when developing the Website positioning and brand images strategy because, too often, Webmasters try to develop a marketing plan according to their own tastes, instead of those of the marketplace," says Nielsen. "From an internal perspective, you need to analyze what you do best and what plays to your unique strengths and then organize your strategy with that assessment in mind."
Nielsen says ATK strives to retain customers as members for a long time - the obvious payoff coming to resellers who garner a percentage of revenue via customers sent to ATK. "It is sometimes more difficult to find a new customer than to keep an existing one," says Nielsen, "so retention definitely has its benefits."
ATK's Webmaster relationship no doubt has strengthened their reputation. "We like to keep in direct contact with all of our resellers to ensure that our sites are being promoted in a manner that meets the ATK standard, which we emphasize on only the highest quality as well as honesty," says Wentz, formerly a project superintendent for a general contracting firm.
The way Nielsen sees it: the adult biz is headed towards an end to the "high growth phase." He says the marketplace is more crowded than ever, with increased competition and rising consumer expectations. "We see the need to focus even more on segmenting the marketplace and not to try to be all things to all people," says Nielsen. "I am not convinced that there was ever a downswing from the perspective of the adult industry due to its very global nature. So we have benefited from an overall increase in the number of consumers who are online worldwide.
"The decline in the U.S. dollar relative to other currencies has meant that membership fees are now more affordable to many potential consumers."
As for the future, Nielsen speaks of a new project that "will set some new standards in the industry, and one that is a natural brand extension for ATK."
He says because competitors imitate many of ATK's ideas, they are continually engaging fresh concepts to remain a step ahead. "We have two other Website projects that are in the initial planning phases. Additionally, we have some new market research projects in the works which will allow us to develop our knowledge of the marketplace further and to better address customer needs."
As a company thriving in Gainesville, ATK is a prime example of how locale has no real bearing on the potential for success in the adult industry. "One of the wonderful aspects of working in this industry is the ability to work with customers and partners on a global basis," says Nielsen. "The growth of Internet has certainly broken down geographical barriers and facilitated the American ideals of globalization along with our notion of a less restrictive, more creative, and truly more competitive marketplace.
"In the end, success is determined by other factors, such as the ability to innovate, discover, and satisfy consumer needs, and build trust with your customers and business partners."
