BUAD477 - Section 10 - Final Exam - Chris Mitchell

BUAD477 - Section 10 - Final Exam - Chris Mitchell - Memo...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Memo To: Heather Yates From: Chris Mitchell Date: 22 May, 2008 Subject: MedNet.com Confronts “Click-Through” Competition Key Issues MedNet.com has a business model in place that relies 100% on advertising revenue. The primary advertisers on MedNet are pharmaceutical companies offering specific and immediate solutions to health concerns. Large search engines, category-specific sites and clinical trial sites all compete with MedNet for advertisers. One major advertiser with MedNet is Windham Pharmaceuticals, but recently they have been weighing their advertising options and decided to give Heather Yates, MedNet’s VP for business development, a call. There was a major issue with the price at which MedNet was charging Windham for advertising. MedNet charges their advertisers by every thousand impressions (CPM), whereas Marvel, a large search engine, charges by their click-through-rate (CTR). Windham is more concerned with click-through’s, which show more interest in possibly purchasing their product, then with impressions alone. Marvel charges Windham $0.54 per click-through and Windham determined that MedNet was charging $3.33 per click-through. Windham is seriously considering shifting there advertising dollars more towards Marvel, and in the process of convincing Windham to stay with MedNet they realized that they must also advertise on 1
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
niche sites such as Cholesterol.com which offers the same strengths as MedNet. The issue for MedNet is to now convince Windham to keep with MedNet and prove to them that they can sell Windham products in ways that Cholesterol.com cannot. What Does an Advertiser Want? The main objective of any advertiser is to see greatest return on their investment (ROI) possible. It is tough for advertisers to determine the exact ROI of an ad campaign. Is it the amount of click-throughs, unique impressions or is there something else that causes a good ROI. Marvel receives 19 million visitors a month leading to 57 million impressions and 798,000 click-throughs for Windham. Compare that to the 4.3 million visitors and 17.2 million impressions from MedNet and Marvel looks like the obvious choice. But, there’s something else that plays into the equation. Marvel is a general-interest site with a large audience, MedNet is a targeted health website whose visitors only come when “in crisis.” However, when they did visit they stayed longer and clicked around to find out information much more. MedNet’s visitors are generally in need of some sort of pharmaceutical product and are more likely to purchase from advertisements on the site. This makes MedNet’s impressions and click-through much more valuable to advertisers, which must be factored in. Consumer Behavior
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 05/25/2008 for the course BUAD 477 taught by Professor Suresh during the Spring '08 term at University of Delaware.

Page1 / 9

BUAD477 - Section 10 - Final Exam - Chris Mitchell - Memo...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online