NONE: Re: ONLINE-ADS>> Zapata is nuts...
Re: ONLINE-ADS>> Zapata is nuts...
Mark Dolley (mark_at_zapworks.com)
Fri, 17 Jul 1998 12:56:59 -0500 (CDT)
>>Humbert Suarez <humbert_at_mwsearch.com> wrote:
>
>>Well, there are some facts that can be obtained relatively easily.
>>Certainly, when you look at the budgets of major search engines
>>such as Yahoo, Excite, Lycos, and Infoseek, you see that the sales
>>and marketing costs are several fold larger than the product development
>>costs.
>
>richard_at_tenagra.com,richard_at_tenagra.com added on 7/15/98 10:17 AM:
>Well, I'd love to see these budgets you seem to be privy to. I would be
>very surprised to find promotional costs that are greater than content
>production costs. The things I include under content production are not
>just writing copy or making graphics, but such things as interface design,
>back-end programming, server administration, bandwidth costs and traffic
>analysis - all things necessary to publish successfully online.
As the costs of bringing your product to market diminish thanks to
technology, the emphasis moves towards building market share. This
applies even if your product is a media property. But the increasing
importance of branding is good news for marketers, right?
An excerpt from the recent Netly News:
Yahoo's Bulging $400 Million War Chest
By Nathaniel Wice (July 10, 1998)
Buried in Yahoo's stellar Wednesday-night earnings report -- sales of
$41.2 million, up 36 percent from the beginning of the year; traffic of
115 million daily pageviews in June, up from 95 million in March; a
2-for-1 stock split -- was news that the search standout was raising
$250 million by selling new stock to Softbank, which already owns nearly
a third of the company. We could all use another $250 million, but what
does Yahoo need it for? The company already has close to $150 million in
the bank, is debt-free and -- amazingly enough, compared to its Net
competitors -- is already profitable on an operating basis. Add to this
the fact that any takeover targets would be happy to get Yahoo's
gold-plated stock. How would you spend the money? Even product
development cost only $5 million last quarter, which must buy a lot of
server tweaks and Java applets. Noting that Amazon has a similar war
chest, our best guess for the bucks: Look for Yahoo's $20 million
marketing budget to go into Superbowl-style overdrive. Maybe they'll
even start mailing out disks.
http://cgi.pathfinder.com/netly/0,2326,201980710,00.html
Mark Dolley z a p w o r k s !
vox:(+1) 415 543 8600
> http://way.nu/advertising
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