Case #4 Yahoo

Yahoo.com is a website that offers its user the company’s primary goods and services free of charge to the user. Yahoo! offers its users with a search engine as well as the ability to customize their own MyYahoo! webpage. Along with these two features customers have access to an email service, messenger tool, radio, weather, local news, horoscopes, etc. all free of charge. This free service is not promotional; Yahoo! has always and will continue to offer their service to its users free of charge.

MyYahoo! allows users of Yahoo! to customize their homepage according to their personal interests. When creating a MyYahoo! webpage users are able to add content, change the appearance, as well as other options. Users are able to add modules which are like widgets for Mac or Google users. Also users can add RSS Feeds as part of their content that appears when they visit Yahoo!. As far as the appearance of the users MyYahoo!, a customer can select to change the color, layout, font size, and search box size. Finally users are offered additional options such as MyYahoo! Reader which allows users to read articles through Yahoo! without having to go to the publisher’s site. Also Yahoo! provides their users with Article Preview which gives a snippet of the article when the user rolls their mouse over the link and Article Timestamp shows users when articles they are viewing were published.

All of these features make for a better experience and contribute to the success of their free economy. The more features Yahoo! offers for free to their customer the more traffic the website will receive. The more traffic Yahoo! gets, the more advertisers will want to advertise using one of Yahoo!’s advertising solutions.

Yahoo! would fall under the advertising model as the principle of the free economy. As an advertising model, Yahoo!'s main form of generating income is through advertisers. Yahoo! offers free content to the users by allowing advertisers to advertise within the site and sponsor the website. Yahoo!'s advertising model offers four solutions for advertisers to use. The four options advertisers are given are search marketing, media solutions, publisher network and recruitment advertising. These solutions allow Yahoo! to continue to offer the company’s product for free while deriving sales and revenue through advertising.

Yahoo! could also be considered a "zero-marginal cost" business plan. Yahoo!'s product mostly consists of their search engine feature. This more commonly used feature is offered to customers at virtually no cost to Yahoo!. Yahoo! has a created a website that can search the web for content in a matter of seconds without the need of an employee to assist the process.

Yahoo! only offers the service to its users as free of charge. The only way Yahoo! draws in revenue is through advertising. The product that Yahoo! offers is not offered at different levels based on cost. There is one form of Yahoo!, which is free for everyone interested in using the product.

As a company that follows the advertising model for a free economy, Yahoo!’s primary source of revenue and profits come directly from advertising. Advertisers are interested in reaching users of Yahoo!’s free business model. Advertisers have options when advertising with Yahoo!.

One of the most common used forms of advertising with Yahoo! would be their sponsor results. Every time a Yahoo! user searches something Yahoo! provides a list of Sponsor Results that coordinate with the users search. Sponsor Results can appear at the top of the list of relevant links or along the side in a separate column designated for sponsored results.