Harvard Business case third(MedNet.com confronts "click through" competition)

THIS IS THE CASE STUDY OF HARVARD BUSINESS SCHOOL PRESENTATION ON"MedNet.com confronts click through competition"
FRAMED BY MADHUSUDAN DAHAL(NIT SURAT)

1. What is Med Net? It is a website delivering health information free to consumers

2. Main motto of launching MedNet are: 1.To provide scientific based medicine information to a non professional consumer audience

3. Objective contd.. 2.To provide this information for free 3.To generate profits from advertising sales

4. What is its source to run? Gets income via advertising from pharmaceutical companies.

5. What is windham ? Biggest advertiser for MedNet Pharmaceutical firm

6. 1.Who is Heather Yates? 2.Who is Bill Bishop? 3.Who is Mahria Baker? “Real players”

7. Heather Yates is the vice president for business development at MedNet Bill Bishop is MedNet’s vice president of consumer marketing

8. Mahria Baker = windham’s ceo

9. What is marvel? Marvel is a large search engine which follows the alternating advertising model

10. Alternating advertising model includes: Contextual , pay per click, banner advertising

11. It depend on “click through rate”=(no. of click) /(no of impression delivered)

12. What is the present situation?

13. Analysis :1 a) Mahir Baker planning to shift ad dollars to Marvel because Marvel advertisement value becomes lesser for windham

14. b) MedNet has to convince them that MedNet set up is worth their ad dollars It is because windham is biggest advertiser for MedNet .If they break up with them then they will be in loss

15. Let’s look at MedNet’s background In 2006 it earned profit to $1million The credits goes to trained doctors ,journalists ,designers , administrators &social media even

16. Revenue Advertising income $ 12000,000 Expenses Purchased content 3700,000 Sales and marketing 3000,000 Technology support 1300,000 General administration 3000,000 Net income =$1000,000 Total= 11000,000

17. Maximum r In 2006,Maximum expense was from purchase content Net profit was one million dollar

18. What happened in 2007? But ,

19. Faced tough competition By providing similar content on mainstream medicine ,non profit & governmental competed with MedNet

20. Resulted .. Divergent on customers Company’s economy declined

21. Condition specific sites gave birth such as cholesterol.com could focus on cholesterol but was minor competitor for MedNet

22. yates found clinicaltrial.com audience was small but was minor competitor Alternativehealth.com provided information regarding herbal remedies ,vitamin regimens , massage

23. Alternativehealth.com audience was greater than MedNet but it had begun to use disclaimers with no impact on audience size That’s why it could not compete with MedNet but had to consider as minor competitor

24. What method is used to calculate advertiser payments?

25. Advertising revenue model was possible by sophisticated web analytics: A technology that tracks the behavior of each visitor-pages viewed , linked clicked etc

26. Software made easy to calculate Return on Advertisement investment(ROI)

27. Old methods : How best to generate revenue from advertisers? Analysis 02

28. MedNet charged windham pharmaceutical on cost per thousand impression (CPM) basis One advertising impression meant that one visitor requested from a web server a page that had specific advertisement on it

29. By imposing an impression business model MedNet was fully monetizing

30. Analyse 03 What can be the Marvel challenge?

31. 1.Was to control click fraud as competitors were fraudulently clicking on advertisements to drive up advertising cost. 2.To capture MedNet customers gradually by offering different offers

32. Analysis 03 Challenge for MedNet to sustain Challenge 1:windham pays $0.54 for each click through to marvel Windham pays $3.33 for each click through to MedNet

33. Now which strategy will MedNEt be following ? How can it protect from going into loss? Click through really what matters at Windham.

34. Baker is in commotion- but cant pay six times as that of paying to marvel? Baker’s investment is constant

35. Yes!!! It was necessary to think it upon W indham’s advertising campaign results

36. Windham pharmaceutical advertising campaign results Advertising venue Marvil search U.S newspaper Monthly visitors MedNet 4.3mm/month 19mm/month 2.5mm/day Impressions W indham received 17.2mm 57 mm 5mm cost $100cpm $.54 per click- through $260000/2-day ad MedNet only came in crisis season Exhibit 02

37. Exhibit 03 MedNet visitors survey results: Did you click on a sponsor’s advertisement today? 3% yes For those who click on sponsor advertisement ,did you make a purchase? 6% yes Have you clicked on a health advertisements on search engine website? 1.4% yes

38. Contd.. For those who clicked on heath advertisement website , did you make a purchase? 2% yes If you saw advertisement on television or newspaper , would you call the call center ? .74 % yes If you called about an advertisement on newspaper or television and found the information credible ,would you make a purchase? 12% yes

39. Contd.. Advertisers at MedNet are more likely to provide me with useful remedies and information than the advertisers found on website that don’t adhere to the same evidence based standards Strongly agreed 85% Strongly disagree 15% How many health sites will you visit to research condition? 85%=3 or more How did you decide to go online to find health information on MedNet ?

40. Contd.. 25% search engine 10% advertisement print 25% online advertisement 20% bokmark this site 10% trusted advisor recommendation 10% email letter from friend recommending article

41. Contd.. Will you return to MedNet next time you need medical information? 93% yes 7% no Will you allow midNet to store your personal information about your condition such as blood pressure , weight etc ? 40% yes 60% no Would you pay for the content at MedNet site? 75% no

42. Contd.. Would you use MedNet if you have to register for some information? 50% no Conclusions: MedNet visitors clicked on more pages and advertisements than general web surfer does

43. Which types of website does visitor visit from MedNET ? FOR THAT ONE MUST LOOK UPON EXHIBIT -4 Advertisement placement General interest website Estimated contribution per sale $48 Search engine $45 Health care website $150 newspaper $165 Television $75

44. Conclusion of exhibit -4 Health website visitors tend to buy more products from advertisers when they did decide to purchase. If product advertised is not available on counter they can go to doctor for prescribtion

45. What is vesselie ? and did coupons selling become effective for windham ? Vesselia is the prescription medication that cures cholesterol and plaque

46. In order to increase prescription of vesselia windham generated coupons on website so that they could print out and redeem at pharmacy On average patient took three months to redeem coupons for vesselia after windam had first placed the advertisement

47. Analysis 04 Windham only pay for click through??? If audience remains constant and provided that MedNet sells only by click through then MedNets gets its revenue depreciated by 80%

48. What if audience is increased and click through also gets increased??? Or should they focus on practices like chiropractic medicine or acupuncture ??

49. But alternative health audience don’t like western medicine or say pharmaceutical companies? So it becomes clear that no a cupunture or chiropractic medicine can help to get out from loss

50. What about instead of selling click through MedNet contract with large employee to become corporate health site of record? If they make their money from corporation they can reduce their reliance on advertisers like Windham

51. But ,One worry !!! Baker underestimates the genuine value that MedNet impression deliver to an advertiser

52. The only way to win this arguments is with numbers not intuition Lets compare numbers that MedNet generates on an impression basis with the number that M arvel generates

53. Insights taken from telephone conversations Proposal : 01 Marvel has provided through click through but those are just opportunities to get windham in front of person “not actual sales” What click through worth if it provides NO SALE??

54. When all vesselia coupon gets returned to windham then Windham will realised what MedNet delivered the best sale result But how can windham make profits from heart medication profit margin??

55. If Windham want people to click on their ads at low rate Marvel ca give that But !!! If Windham want people to see at content and consider their message Windham want MedNet

56. Analysis 05 Since budget is constant , windham has to pay for ads on cholesterol.com.if it does not pay its competitor will gets its consumer .so what to do in such condition?

57. How to sell vesselie in a ways that cholesterol.com cannot ?? Bakers analogy Both MedNet and cholesterol.com had targeted high profit audience that returned for up to date and trustworthy solution about cholesterol medication

58. Cholesterol.com is category killer Focuses on chronic condition such as cardiovascular disease ,obesity Cholesterol.com was launched by lawyer with$47 This sites recruited international doctors and designer .they could make information in 13 language including chinese

59. Cholesterol.com was powerhouse in A sia Could offer travel agencies to promote Global Health Tourism Site significant marketing budget paid for a large ,multilingual advertisement campaign

60. What MedNet could do when niche’s competitor was existing in market?? MedNet continued to believe that providing source of information that could deliver real value to its reader

61. Mednet perceived that some condition specific sites came dangerously close to diagnosing condition and prescribing treatment for visitors Were at risk of violating both state and federal government rules So mednet refused to provide medical treatment

62. Insights from conference call Treating visitors as patient as that of cholesterol.com did can reduce the dependency on advertising revenue

63. But would M ednet board stand for aggressive approach to dispensing medical information?? Bringing alternative health information(like acupuncture) to the site ,can it be fruitful?

64. But would this help the problems of flattening advertising revenue pharmaceutical firms like Windham?? But main thing is to develop healthy relationship , trustworthiness among users.

65. At last ..think on it Would employers let them introduce pharmaceutical advertising ?

66. This presentation is framed by Madhusudan Dahal under the guidence of prof. Sameer Mathur (iiminternship.com)

67. Sameer Mathur MBASkills.in Indian institute of Management Lucknow Marketing professor 2013- Marketing professor 2009-13 Ph.D and MS(marketing)2003-2009 Madhusudan Dahal National Institute of Technology surat intern