MedNet.com
MBAA 609
R. Nakatsu
What is MedNet’s business model?
Internet business models “are at heart,
stories—stories that explain how enterprises
work.”
 Who is the customer?
 What does the customer value?
 What is the product/service it offers?
 How does MedNet generate revenue?
 What differentiates MedNet from its
competitors (see next slide)?
Competitive Threats
Marvel
 Niche web sites
 (Nonprofit and governmental web sites)

How do these web sites threaten
MedNet’s business model?
Web Analytics
is technology that tracks the behavior of
each site visitor—pages viewed, links
clicked on, and so on.
What can you track?
 Page views
 Links clicked on
 Conversion?
Calculating ROI
Sales profit per advertising campaign =
[ (# of impressions) * (click through rate) *
(percent who buy) * average sale’s profit margin ]
- advertising cost
ROI (return on investment) =
Sales profit per advertising campaign
Cost of the Advertising Campaign
Web Metrics Tool
Assumptions: MedNet vs. Marvel
Contribution
per Sale
MedNet
Conversion
Rate
6%
Marvel
2%
$45
See Exhibit 3
See Exhibit 4
$150
Main Takeaways

Understand variations on the advertising
revenue business model.
 Understand the difficult tradeoffs that must be
made in deciding on your business model.
 Engage in quantitative analysis using web
analytics. In particular, you can calculate the
ROI for advertising campaigns.
 Analyze the competitive threats faced by web
companies.