Blue Ocean Case Study

Corporate Strategy

Professor Lawson

Case Study: Blue Ocean (Wikipedia)

Based on the reading from the Harvard Business School course pack, provide short answer responses to the following questions:

1.  What are the sources of income and expenses for Britannica.com?

While a portion of the articles on Britannica.com are available for free, most of their articles and access of their full articles with expanded reference information require an annual subscription of $70, and 30$ for a premier membership. These memberships provide the user with add-free viewing and access to any article on the database, allowing for complete usage. Britannica has seen its daily traffic ranking steadily decrease as it increases for Wikipedia. Expenses for Britannica are the 20 employees who provide support to 8.4 million unique monthly visitors, their salary, and the copyright license required to have access to the author’s work that they publish.

1.  What are the sources of income and expenses for Wikipedia?

Wikipedia’s source if income is very different, not needing a license since they consider the information free knowledge. This means that while they have editors and other staff, who get salaries, they mostly have volunteers. They make their majority of money with advertisements, and also the Wikimedia Foundation. The Wikimedia Foundation is a program that allows users to donate for the service, asking them to keep it free and afloat by donating just a couple of dollars. This has proven to be successful for Wikipedia. The administrative overhead is low, having 30 employees to support an average 346 million unique monthly visitors who access over 11 billion page views. Expenses

1.  Was Wikipedia able to leverage its value proposition in any way to strengthen its profit proposition?

Wikipedia was able to leverage its value proposition in order to strengthen its profit proposition. Being free to use for users, Wikipedia has no steady revenue or cash flow since it does not require a membership fee. Users appreciate this and understand how big of a benefit this is, unlike the Britannica system. Wikipedia has been able to show just how accessible and easy to use Wikipedia is, giving them access to any information they could want, showing them just have valuable this webpage is. In return, Wikipedia created a fundraising foundation to keep the website alive and to help pay for operating costs. The user, realizing how big of a benefit the free information is, does not see a couple of dollars as a hassle or expense to keep this website available, showing how they increased their profit proposition by creating such an impressive product. People donate to keep Wikipedia alive.

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