About: MedNet, a website delivering health information free to consumers, generated its

income through advertising, mostly from pharmaceutical companies, particularly Windham

Pharmaceuticals. Advertisements on MedNet proposed specific and immediate solutions to
health concerns. The site was considered the best health website for its trusted, evidence-based,
consumer health information. MedNet chose traditional banner advertising on a cost-per-
thousand-impressions (CPM=1000*cost/impressions) basis, priced at USD 100.

Now, Windham Pharmaceutical wants MedNet to change its rule for advertisement charging or
face the risk of losing them to Marvel, which provides a vast audience of 19 million
visitors/month and charges a click-through rate (CTR=clicks/impressions) basis, priced at
USD 0.54/click-through.

Swot Analysis
Strengths 
1. It is considered the best health website for trusted, evidence-based, consumer health
information with easy to navigate.
2. It has a high customer retention rate, who surf and click on more ads as compared to the
general user.

Weakness
1. Small audience base as compared to the competitors, with flattened growth rate.
2. High advertisement rates by MedNet were pushing away the current and potential advertisers.
3. The audience used to visit the MedNet site only “in-crisis”.

Opportunity
1. MedNet’s consumer health information was trusted and evidence-based which can be easily
monetised.
2. It can start advertising for herbal remedies and accepted practices like chiropractic medicine
and acupuncture.

Threat
1. Non-profit and governmental websites were providing similar content on mainstream
medicine in a comprehensive format.
2. Competitors like Marvel (Search engine), Cholestrol.com (condition-specific site),
ClinicalTrials.com (indirect competitor) and Alternativehealth.com.
Competitors: MedNet.com was facing a tough competition majorly from the following
organizations.

 Non-profit and government websites: These provided content of similar kind on

mainstream medicines, most were extensive but not easy to traverse. Ex- U.S. National
Library of Medicine and World Health Organization.
 For profit health websites: Condition specific websites or marketed experimental
procedures. Ex- Cholestrol.com and ClinicalTrials.com. 
 Websites in health space: Provided information about traditional and non allopathic sort
of medicines like herbal remedies, “unproven” therapies, etc. Ex- Alternativehealth.com
 Search engines and general interest sites: Were used for purposes other than to explicit
search about medical information. Ex- Marvel.

Options Available:
 Taking a prescriptive, diagnostic posture toward site visitors—treating them like patients,
similar to what Cholesterol.com did:
o Pros - The dependency on ad revenues will reduce, will be following a focused
strategy with a niche target segment, this might attract new customers.
o Cons - Regulatory norms, might lose customers that seek general information,
currently 75% of the customers have said that they would not pay for services that
MedNet.com provides and there is no concrete proof that this might change in the
future, will not be lucrative for current customers.

 Bringing alternative health information to the site:

o Pros - Acquisition of new kinds of customers that will increase customer base,
can introduce click through advertising, revenues generated will not be restricted
to pharmaceutical companies.
o Cons - Will alter original value proposition, will cause dilution of strengths like
trustworthiness, which in turn could lead current clients to withdraw contracts,
even otherwise, this option does not add any value to the current client base, this
will also cause a stark difference in the customer base and hence will make
targeting ads cumbersome.

 Building on their greatest strength as well as their web business expertise, to evolve into a
developer and manager of employer websites.
o Pros - Can leverage existing market needs where employers are seeking to build
intranet-based healthcare solutions, will increase people who view ads, will not
cause dilution of strengths, alternative revenue will be generated, can implement
click through advertisements and satisfy current client base. 
 o Cons - Could cause the company to lose independence, can lead to self-
cannibalization, will add new costs, advertisements will be subject to approvals
by employer organisations. 

Recommendation: Based on the above evaluation of options we recommend that MedNet.com

should implement the third option because it does not dilute their strengths and since it seems to
have larger revenue potential whilst satisfying current client demands.