Lisa Preference of Corporate Value Model by gse86910

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Business Model   L.Ghafoorian
    Outline
       Introduction
       The Changing face of the media industry
       Women as a market
       History
       Target market
       The competition
       WWW.iVILLAGE.COM
       Financial issues
       iVillage‟s Business Model
       iVillage„s Business strategy
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    Introduction
     Name value iVillage.com has an implication of women
      society. iVillage comes from my village.
     Candice Carpenter is confounder and CEO of iVillage
     iVillage is extremely successful in market
     iVillage is the ultimate women‟s online resource
     Competition in media (OXYGEN,…)
     In meeting with stockholders, innovation is most
      important to remain in competition

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    The Changing face of the media industry(1)
     Internet is the most popular in the world
     Internet redefined the role of media
     Increasing number of internet users
     Low cost infrastructure
     Nature of its interactivity
     Anyone can access to computer and internet
     Commerce revenue on the internet increasingly rise
     With going internet, traditional media were going to
      shake down

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    The Changing face of the media industry(2)
     with internet and e-commerce , traditional media can distribute
      and interactive and retain audiences
     Internet has not managed to replace other media
     Internet was blurring the lines between different form of media
     Forcing traditional radio station,magazine,newspapers to build
      a presence in other channel
     Media focus on the strength and elasticity the suitability to 25 to 49
                                                    Women aged
      different end user device
     iVillage created a strong brand on a specific market


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    Women as a market
     Women control 85% of all personal and household
      goods spending
                                  day 8.2 hours to 8.8
     Women consume media perWhy women’s websites
      hours                          Have grown

     Women comprise 57% of new internet service
      provider subscribers
     77% of women went online to explore, but 86%stayed
      because they found information that helped them get
      through their daily lives
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    WWW.iVILLAGE.COM
    History
     Established in 1995 by CEO Candice Carpenter and
      editor-in-chief Nancy Evans
     Carpenter as a mother of two childrens:
             Women today are so pragmatic and they use to internet to
              find out how to get things done
     iVillage was for women looking for information on
      topics such as children,health,family
     Online community where members develop
      relationships
     The consumers drive to the site's innovation
             The company has to respond by further developing the
              offering to fit the needs and wants of its users
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    WWW.iVILLAGE.COM
    Target Market
     One of the most demographically targeted
      online communities on the web
     Developed to the interests and needs of
      women aged 25 through 49
     iVillage was an attractive market segment for
      advertisers and sponsors
     iVillage was recognized as a leader in
      developing innovative sponsorships and
      commerce relationship

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    iVillalge Demographic Profile
           Gender                Female/Male           80%/20%
            Age                      Average             33.7
      Household Income               Average           54.744$
                                     Married            59.6%
                               Living with parents      7.6%
       Material Status
                                       Single           21.7%
                          Separated/divorced/widowed    11.2%
                                Full time                55%
                                Part time                9.7%
      Employment status         Work from home           9.3%
                                Unemployed               5.6%
                                Student                  9.1%
                           Graduated college            61.2%
          Education        Attended graduate school     6.4%
9                          Postgraduate degree          12.7%
     The competition


           We must stay focused as opportunities
                      are ours to keep




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     Women. COM
      Owned by Hearst New media and technology
      Originally founded as a content site
      Exploit Hearst's rich database on women customers
      Include of some community features and started a
       small commerce venture




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     Oxygen media ,Inc.
      Backed by strong media and heavy investors
      Was founded by Geraldine Lay Bourne (most powerful women
       executives in TV industry)
      Interested for innovative approach to satisfying women‟ s need
      Combined (entertainment power of TV & power of internet)
       interactive television and site
      Oxygen‟s model was innovative , more comprehensive , and
       hard to imitate
      To raise revenue
              Attracted a board range of advertisers
              Attracted E-Commerce partners
              Charging fees per subscribers
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     Oxygen media ,Inc.
      to raise money use by attracting advertisers
      Oxygen's business model is unique and innovative
      "The combination of Oxygen online and Oxygen cable is a
       futuristic and visionary approach that will shape the future of
       the new media industry.“
      iVillage and Oxygen are competitors in terms of same target
       market and on-line service.
          The more value they provide to the customer, the more attractive their
           websites are. Thus, the company who owns a large number of
           customers would have greater competitive advantage
          According to the intuition of women iVillage is quiet, safe and peaceful,
           while oxygen if full of adventure and exciting..
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     WWW.iVILLAGE.COM
     Product
      Network‟s communities ,find solutions ,handle challenges
      Community
          Friends with similar interest
          Devoted to discussion, debate, and sharing ideas
      Goals of iVillage:
               Help women navigate through increasingly busy lives
               Maximize their potential in their various roles as parents, friends ,spouses
                ,partners ,career women, bread winner, employees ,individuals
      The first company that offer this type of online product to women
      content-only based community – based
      Information on finance or world news
      Provide group of experts for consultation
      Discussion boards of like-mind women to help and share
       experience
      Women can get all kinds of information they wanted on iVillage.com
       without buying newspaper or magazine. On this point iVillage offers
       their customer the lower cost products.
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     Products




            Software: library, book keeping,
                Billing ,legal, payroll,..




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     Traffic
      Ivillage was the most successful women‟s web sites
      Traffic flow is vital success and future potential in internet
       business model
      Statistic in June 19982 million different visitors of ivillage
      Twice the traffic of competitor such women.com
      In April 1998  6 million pages view




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     Financial Issue
      iVillage (like companies based on WWW) had accumulated a
       substantial deficit
      Profitability was not a near goal




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      Due to restructuring iVillage‟s business model
     iVillage‟s business model
      iVillage (Based on content and community ) revenues:
               Selling banners, text-link , sponsorship from other business
      Traffic attracting advertising client
      Business model volume-based model (volume is vital factor to attracting
       advertising client)
      Successfully of advertising-based model
      Reaching the broadest possible audience/viewers/readers/visitors/so-called
       eyeballs
      Advertising might be successful is to have a highly targeted and specialized
       audience
      The number of viewers is also called the volume of viewers; hence this
       model is: volume-based approach.
      But internet advertising :1% of the total revenue
      More web sites were competing for the advertisement
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     Revenue Source
        Banner advertising
        Sponsorship
        Production
        e-commerce
        Content licensing
        Satellite television through the Newborn Channel
        Print media
        Direct mail
        Video production



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     Sponsorship
      Charles Schwab & Co
          Financia l or investing related sites.
      Ford Motor Media
          Promotion of the sale of Ford automotive products across our Web sites.
      Fuji Photo Film USA
          Exclusive sponsorship for the photographic film, disposable camera and digital
           camera categories throughout our network.
      General Electric
          Exclusive sponsorship for GE Appliances of the speed cooking ovens category
           throughout our network.
      Glaxo Wellcome
          Exclusive sponsorship for certain disease categories throughout our network.
      Ralston Purina
          creation of a pet channel and provider of content, experts, customer service
           and distribution for the pet channel.
      Warner Lambert
          promoting and marketing a range of products.
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     iVillage‟s business model
      iVillage (Based on content and community ) revenues:
               Selling banners, text-link , sponsorship from other business
      Traffic attracting advertising client
      Business model volume-based model (volume is vital factor to attracting
       advertising client)
      Successfully of advertising-based model
      Reaching the broadest possible audience/viewers/readers/visitors/so-called
       eyeballs
      Advertising might be successful is to have a highly targeted and specialized
       audience
      The number of viewers is also called the volume of viewers; hence this
       model is: volume-based approach.
      But internet advertising :1% of the total revenue
      More web sites were competing for the advertisement
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     Advertising models
      Generalized portal (also called a horizontal/general
       portal )Yahoo,msn.
      Personalized portal (which is a generalized portal that is customized
        to the user‟s preference) my.yahoo.com
      Specialized portal (also called a vertical portal)
      Free model
              some service or product is given free
      Recommender system
      Community provider:
          experts provide information in response to queries from
          community members.
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     General vs.. Vertical Portal
     General Portal           Vertical Portal
      Attempt to attract a    Attempt to attract
       very large general       highly focused, loyal
       audience and then        audiences with a deep
       retain it on-site by     interest in either
       providing in-depth       community or
       vertical content         specialized content
       channels


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     iVillage – Vertical Portal
        Focus on women aged 25 and above.
        Topics of high importance to women
        Health & Well-Being
        Beauty & Style
        Diet & Fitness
        Pregnancy & Parenting
        Home & Food
        Entertainment
        Magazine
        General Features:
          Astrology, Message Boards, Blogs, Newsletters, Free
           Stuff, Quizzes, Games, Shopping, Multimedia, Search

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     iVillage‟s business model(2)
      In stead of congested banner and link and advertisement
       new business                              Register any conversation separated
                                                 by location ,interest ,hobbies
      Customer profile (different message board)
      iVillage develops its e-commerce especially for information
       service
               When search brief information pay money whole information
      customer can be benefited from two aspects:
               the information is updated because the communication
                is ongoing every day.
               the information is much valuable and the customer can
                use it to solve the problem in real life.
      Customer loyalty :more value to customer.
      It is an important differentiate strategy for iVillage.
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      This cause e commerce business model generate profit
     The shift to e-commerce
      For instance:
          Amazon.com:2.5 million books,1998:124.5$ million loose
          Spend vast amount money marketing its product and services
      But iVillage have distinct advantage
      iVillage launch iBaby to its existing customer base and online community
      Content site community site e – commerce
      new commerce revenues by selling products or services that have a high
       degree of relevance to our members
      iBaby:
         delivered baby products and gift service in world wide
         Quick and convenient shopping experience for it‟s customer
         Offer more than 14000 baby related products
         Access to over 800 vendor
      The combination of volume-based and e-commerce business model provides
       more value to the customer
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     Business strategy
      BUILD STRONG BRAND RECOGNITION
              branding expenditures toward offline branding on television and radio, through direct
               media spending and through strategic alliances with traditional media partners.
      AGGRESSIVELY GROW MEMBERSHIP
              Once the user has visited iVillage.com, our mission is to convert that user to a
               member
      ENHANCE AND EXPAND THE NETWORK
      PURSUE STRATEGIC ACQUISITIONS AND ALLIANCES
         Promote iVillage name
         Drive traffic to iVillage website
              Online Psych, one of the largest online health communities focused on mental
               health;
              Lamaze Publishing, a multimedia provider of education information to expectant
               and new mothers
              Family Point, a leading online meeting place for families, friends and groups with
               similar interests.
      INCREASE SPONSOR AND ADVERTISING REVENUES
      GENERATE E-COMMERCE REVENUES
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     Reference
      iVillage website statistic: www.corporate-ir.net /ireye/ ir_site.zhtm
       l?ticker IVIL&script2100.
      Lisa Allen, Bill Bass, Chris Charron, and Jill Aldort, “Old Media‟s New
       Role,” The Forrester Report, no. 5 (January 1999), p. 6.
      Allison Abraham, “Internet Communities,” Presentation in Electronic
       Commerce class, New York University, Stern School of Business,
       April 12, 1999.
      Heather Green, “For Women, iVillage is a Site of Their Own,”
       Business
       Week, businessweek.com/1998/29/b3587126.htm, July 20, 1998.
      Susan Karlin, “It Takes an iVillage,” Upside Magazine,
       www.upside.com/ texis/mvm/story?id=3665bcf40, December 2,
       1998.


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