Yahoo!: Pricing Search Engine Advertising

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Case

Reference no. 506-056-1

Subject category: Marketing

Authors: Ioana Popescu (INSEAD); Alex Dabbous (INSEAD)

Published by: INSEAD

Originally published in: 2006

Version: 04.2014

Length: 17 pages

Data source: Published sources

Topics: Advertising; Internet; Search engine; Pricing; Customer segmentation; Revenue model; Auction; Willingness to pay

Share a link: https://casecent.re/p/68327

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Abstract

The case discusses Yahoo!'s marketing services, and various types of advertisement. The main focus is on search engine advertising, one of the most important revenue sources for Yahoo! The market, Yahoo!'s pricing strategies and challenges are described. This case aims to introduce participants to several pricing and revenue management concepts: (1) building a revenue model; (2) customer segmentation; (3) product design; (4) bundling; and (5) pricing. One of the key merging concepts is opportunity cost based pricing. The case can also be used to discuss media rating measures (CPM (cost per thousand impressions) vs pay per click) and B2B (business to business) pricing strategies, such as contracts and auctions. A teaching note supplement is available to accompany the teaching note.

Location:

Worldwide

Industry:

Internet

Size:

7,600 employees (in 2005)

Other setting(s):

2005