A01 chaf6542 06 se fm indd

 Pay-  per-  view. A fee for a single download or viewing session at a higher relative price 

than the subscription service. Music service Napster offers vouchers for download in a 

similar way to a mobile company ‘pay as you go’ model. Travel publisher Lonely Planet 

enables visitors to a destination to download an introduction for a fraction of the price of 

a full printed guide.

● 

Bundling. Different channels or content can be offered as individual products or grouped 

at a reduced price compared to  pay-  per-  view.

● 

Ad-supported content. The publisher’s main revenue source is through adverts on the site 

(CPM display advertising using banners ads and skyscrapers, a fixed sponsorship arrange-

ment or CPC, which stands for ‘ cost-  per-  click’). Other options include affiliate revenue 

from sales on  third-  party sites or offering access to subscriber lists. The UK’s most popular 

newspaper site, The Guardian (

www.guardian.co.uk

), once trialled an ad-free subscription 

service, but it, like many online publishers, has reverted to ad-supported content.

Also related to the product element of the mix is how the Internet can be used to assist in new 

product development by assessing product needs from website logs (Chapter 12), testing 

new concepts, online surveys and focus groups.

Quelch and Klein (1996) also noted that the implication of the Internet and globalisation 

is that to remain competitive, organisations will have to roll out new products more rapidly 

to international markets. More recently, Malcolm Gladwell in his book The Tipping Point 

(2000) has shown how word-of-mouth communication has a tremendous impact on the rate 

of adoption of new products and we can suggest this effect is often enhanced or facilitated 

through the Internet. The implications of the tipping point are discussed in Box 8.3.

Box 8.3

How does the tipping point apply to digital marketing?

Marsden (2004) provides a good summary of the implications of the tipping point for 

marketers. He says that ‘using the science of social epidemics, The Tipping Point 

explains the three simple principles that underpin the rapid spread of ideas, products 

and behaviours through a population’. He advises how marketers should help create 

a ‘tipping point’ for a new product or service, the moment when a domino effect is 

triggered and an epidemic of demand sweeps through a population like a highly con‑

tagious virus.

There are three main laws that are relevant from The Tipping Point: