Read the In the News article below and then answer the questions:
20 October 2006
If you are a regular visitor to Biz/ed you cannot have failed to have noticed a difference in the site this week. There is now a new design for the site and a new look and feel. There is also another major difference - adverts. This is a new departure for Biz/ed and one that represents both challenges and opportunities.
A bit of history might help to see why Biz/ed has made these changes. Biz/ed has been going for ten years but in 2002 received funding for a three year period from a body called the Joint Information Systems Committee (JISC). This was public money - effectively tax payer's money - that enabled Biz/ed to plan ahead and develop new regular resources. As the funding period came to an end a further agreement was reached for more funding.
Unfortunately, the new funding had to be stopped when the JISC itself faced cuts in its funding. The future for Biz/ed looked bleak; we had until July 2006 to find a way of maintaining the service. A 'white knight' in the form of publisher Thomson Learning came to the rescue and after lengthy negotiations with the University of Bristol, acquired Biz/ed in August 2006. Biz/ed now entered the brave but scary commercial world of the private sector.
All of the regular resources on Biz/ed will remain free to use and both teachers and lecturers and students might not notice too much difference in the service apart from the obvious design changes. However, to acquire Biz/ed Thomson had to have a business plan and had to present a sound commercial case to the main Thomson board of directors in the United States. Not only were funds needed to pay to acquire Biz/ed but there were also a number of ongoing costs - namely the salaries of the Biz/ed team. All of this had to be taken into consideration in the business plan.
Thomson will expect, therefore, their investment to make some returns in the coming years and to do so revenue has to be generated. One of the big advantages for Thomson was the number of people who use Biz/ed. The size of the audience means that Biz/ed is an attractive proposition for businesses looking to reach potential customers. Thomson and Biz/ed had to think about re-designing the site to enable it to carry advertising. If revenue could be generated from companies willing to advertise on the site, resources can continue to be provided free of charge.
The re-design was a major project involving all the Biz/ed team and a management team from Thomson. Behind the scenes there was feverish activity to prepare for the launch of the new site design and the new URL - http://www.bized.co.uk. An advertising agency was also recruited to source potential advertisers. There were concerns that users would face a bit of a culture shock seeing advertising on the site but there are plans in place to try and make sure that the type of advertising is appropriate to the site and to an educational resource provider.
Finally on Monday 16th October, the launch was announced - the new Biz/ed is here, alive and thriving. The new look and the new commercial environment that Biz/ed will have to operate in provides opportunities to develop even more high quality resources in the future. The team have learnt a great deal, in the process, about the needs of a commercial environment and we have been living a real life business case study. We have also learned some of the jargon as well as we go for the 'low-hanging fruit'* in the early stages.
* Low hanging fruit - the easiest route or the most easily attainable goal or objective or customers that are most easily within reach of an advertising campaign who you can convert into revenue generating customers!
Listen to the podcast [mp3 1.52 MB]
Using examples, explain the difference between above the line and below the line advertising (6 marks)
Thomson Learning is part of a global corporation called Thomson. The Thomson Corporation has shares listed on the New York Stock Exchange (NYSE) and has a combined corporate turnover of over $8 billion. What type of business organisation do you think Thomson is? Explain your answer. (4 marks)
One of the difficulties facing the advertising agency in finding suitable advertising is knowing who Biz/ed's main users are (who are the low hanging fruit). Who would you think are the predominant users of Biz/ed and what sort of advertising would you suggest is appropriate for this audience? (8 marks)
Biz/ed has identified certain types of advertising that it does not want to carry. What types do you think Biz/ed identified as inappropriate and why? (8 marks)
Our advertising agency comes along and announces that they have a major fast food company which wants to gain exclusive rights to advertise on the site. The company has offered a substantial sum for this right, a sum which would help Thomson and Biz/ed break even much earlier than planned and generate a healthy profit. Should Biz/ed and Thomson take the offer? (14 marks)