Richard A. Wiklund got the idea for his dot-com last year while sifting through the CDs in his mail.
A Web site designer at the time, Wiklund knew his clients were looking for ways to attract customers to their Internet sites to encourage e-commerce.
"My customers were all saying, 'I just spent hundreds of thousands of dollars designing a Web site, now how am I going to get people to go there?"' said Wiklund, who founded PortCD.com in October.
Wiklund, 33, struck upon what he believes to be a cost-effective way for companies to use CDs to get the word out. And today that idea - in the form of 150,000 CDs - will go to 141 Toyota dealers in the mid-Atlantic region who will hand them out to people leasing or buying a new car.
The CDs give customers a fast way to reach Toyota's Web site, so they can learn about services, products and programs.
But as they click on various topics, the software tracks their areas of interest and returns that information to Toyota.
The theory is that the CDs will better inform Toyota about its customers and able to provide programs and services to match those interests.
Using the CD, consumers also will be able to plug into a music program.
Wiklund landed the Toyota account last month after being introduced to a representative of the ad agency for Central Atlantic Toyota Dealers.
PortCD charges between 60 cents and $2 for each CD, Wiklund said. There is an additional cost every time a customer clicks on the CD program, sending more information about himself or herself to the corporate client. The program runs for six months or for a year.
The client accesses the data, which is updated every few minutes, on a password-protected Web site.
"Unlike a banner ad that's fleeting, the CDs get a better response rate and have a better shelf life," Wiklund said. Initial tests showed a CD gets three to six times the replies of a traditional piece of direct mail, which typically nets a response rate of less than 1 percent, Wiklund said. People were still responding to the trial CDs six months later, he said.
PortCD's concept got a thumbs up from another new media company here.
"It makes a lot of sense from the standpoint of attempting to use interactivity to reinforce the company's brand and to maximize the lifetime value of the customer," said Christopher Parente, a spokesman for Advertising.com, a Baltimore company that does direct marketing on the Web.
But he and others in the industry agree that the first big challenge is getting people to use the CDs.
Wiklund and his three employees, who work out of an office on Falls Road just over the city line in Baltimore County, hope to seal deals soon with a major video rental store chain and a major beer company.
They also plan to patent the software technology next month and may consider a public offering by the end of 2001.
With less than a quarter million dollars invested, the company had sales in the tens of thousands last year, Wiklund said.
He predicts that sales will be in the millions this year and tens of millions next year.
One recently acquired customer is the University of Dayton, which hopes to use 20,000 CDs, with high-quality video and music, to attract students to its Web site and expand its pool of applicants.
The private Catholic university, which was recently named one of the 25 top wired universities in the country by Yahoo! Internet Life, has found that a high percentage of the students who register on its Web site then apply - 53 percent for the class that starts in September.
"This is potentially a real milestone in the way universities can encourage students and families to visit their very expensive Web sites," said Chris Munoz, associate provost, who made the decision to hire PortCD.
Munoz predicts that PortCD will find many uses for its technology.
"It's going to come down to how well do they create that CD," he said. "How compelling is it. That's the only thing that's going to limit them."