Adaptive Marketing - Monetization and Pricing Models for the New world

Monetization Models A Case Study based discussion

Chandra V, Head of Products, InMobi Chandra.vattikuti@yahoo.com

Topics of Discussion • Pricing Design & Pricing Approaches• Marketplaces

– One-sided, Two-sided and Multi-sided marketplaces

• Two-sided marketplaces• Discussions around

– Naukri– Google – Drop Box/Evernote – LinkedIn– Mobile

• Monetization in two-sided marketplaces– Ad Supported– Direct sell ( Digital Goods or assets ) – Subscription– Freemium – Marketplace– Marketplace of marketplaces– Sponsorhips

Pricing DesignPricing

Driver

Profitability

Mkt Share (Units)

Revenue (Sales)

Signal (Mktg)

Types

Competition

Cost

Value

Stages

Penetration, Skimming

Diversification, Captive

Bundling, Acclerators

Special Offers

Formula

Tier

Usage

Loyalty

Mix

MSRP

Sell ThroughPayment Terms

Pricing Approaches

Actual Cost of Product

Add: Target return

Price to Channel

Add:Markup of Channel

Cost-based Pricing

Price to Customers

Competitive Pricing

Perceived differentiation of company’s offering

Price to Customers

Competition-based Pricing

CustomersCustomer’s Perceived Value

Price to Customers

TargetCost Product

Value-based Pricing

Channel/ companymarkups

Cost Per Revenue Dollar (CPRD)

Marketplaces• Marketplace - “the world of commercial activity where goods and services are

bought and sold.”

ebay

Buyer

Seller

Craigslist

Lessee

Lessor

LinkedIn

HeadHunters

Passive Job

Seeker

Shaadi dotcom

Bride Seeker

Groom seeker

What marketplace is this ?

Us Merchant CCABank

Value Propositions

Value Proposition

Different Kinds of value provided by Firms/Individuals/Technologies, to their Customers

• Newness • Performance• Customization • “Getting the job done”• Design• Brand/Status • Price• Cost reduction • Risk reduction• Accessibility• Convenience/usability

Applying this lens to everything around us ?

Us Merchant CCABank

Naukri – Marketplace of Jobs seekers/providers

Finding a Job

Professional Development

User Intent

..

Naukri – Marketplace of Jobs seekers/providers

Job Seeker Marketplace

Billboards Employers Job Seeker

Naukri – Marketplace of Jobs seekers/providers

Monetization models seen on Naukri

• Ad Supported

• Subscription Sells

– Database sells to Recruiters & Consultants

• Services revenue

Google – Marketplace of Information seekers and marketersEnd user of Google Search

Marketers

Marketplace

Publisher

Monetization models seen on Google O&O Inventory

• Ad Supported

Ad Networks

• Ad Networks bring together Publishers and Advertisers (who would otherwise, not be able to discover and work with each other).

User

Ad Sense

Going off on a tangent ..

Freemium

Free + Premium

Freemium

Free + Premium

Subscription

Direct Sells (Apps)

Virtual Goods

Sponsorships

Subsidized, two sided marketplaces

Users

Infrastructure Monetization (IaaS, PaaS, SaaS)

Summary• Monetization in marketplaces

– Ad Supported– Direct sell ( Digital Goods or assets ) – Subscription– Freemium – Marketplace– Marketplace of marketplaces– Sponsorships– Subsidized pricing

Q & A

Thank you

Appendix

Strategic Pricing Process

31

Customers Values Prices Costs Products

Value CreationCPV, Economic Value

Price StructureMetrics, Fences

Price & Value Comn.ROI Tools, collateral

Pricing Policy

Negotiation, Discounting

Price LevelPrice setting

Strategic Pricing Phases

Typical customer-led pricing design

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Pricing is a function of Communicating Value