[E-marketing] Case4 MedNet.com -- Question 1

1.   If Internet media is so measurable, how can Heather Yates and Bill Bishop be in such a predicament?

Ans: 

People always get lost in “numbers”. Both of CPM and CTR are indicators of evaluating internet traffic. However, they do not account for profit to a company. Although the website traffic and the numbers of click-through measure either the brand awareness or the effects of advertisements, there are other quantitative metrics while we are reviewing the revenue as well as the net income brought by on-line advertisement.

 

MedNet.com to an extent is an information-providing website. People turn to MedNet.com when they are in crisis, such as suffering from uncomfortable symptoms of veiled diseases. Therefore, traditionally speaking, MedNet.com evaluates its on-line profit by eye-balls. The more people browse through MedNet.com, the higher eye-balls of the advertisers of MedNet.com would have. With such a business model, MedNet.com charges advertising fees from the advertisers based on the CPM of the advertisement, which may be higher than counting advertisement fees according to CTR as Marvel provides.

 

Nevertheless, as we mentioned higher CPM or CTR are not equivalent to higher profit. As the website traffic indicators, CPM and CTR represent how many people went through the website and click for the material fit for their interest. Concerning for the profit evaluation, however, CPM and CTR are not adequately enough. We shall put more emphasis on the cost-efficiency issue. For example, apart from CPM and CTR, the ROI (Return on investment) of on-line advertising should also be taken into consideration.

 

For example, MedNet.com can serve or ask its advertisers by using coupon as a tool, like Windham did in this case, to trace back the utilization rate of on-line advertisement. Each coupon is printed with a printed barcode generated from the original website. When consumers use the coupon during purchasing medical goods, the bar code will be transferred into database to make records. Therefore, MedNet.com can analyze the barcode utilization records to realize how many people really click into their on-line advertisement and, most importantly, make a consumption behavior.

 

Taking account for this kind of whole investment and the real profit generating from on-line advertisement, we can then measure the effects of Internet media like MedNet.com, Marvel or Cholesterol.com provide.