Integrating PPC and flat fee pricing schemes to optimize the internal search engine revenue in the electronic market

Pei Li, Jun Dai, Zhangxi Lin

Research output: Contribution to journalConference articlepeer-review

1 Scopus citations

Abstract

Currently, the predominant pricing plan for the search engine (SE) advertising services in a proprietary electronic market is a flat fee (FF) pricing. These services have faced the challenge of customer attrition recently since FF pricing results in the inequality of service surplus among subscribers. A more sustainable and profitable pricing model would be to distinguish advertising resources by providing an additional usage-based pricing for certain user groups to transfer the service surplus among subscribers. We conceive a hybrid model integrating Pay-Per-Click (PPC) pricing into FF pricing. This proposed scheme can offer an incentive-compatible mechanism to attract more subscribers by relieving the inequity of service surplus, and eventually result in the increasing revenue of service providers.

Original languageEnglish (US)
Pages (from-to)389-397
Number of pages9
JournalProceedings of the International Conference on Electronic Business (ICEB)
StatePublished - 2010
Externally publishedYes
Event10th International Conference on Electronic Business - Service-Oriented E-Business, ICEB 2010 - Shanghai, China
Duration: Dec 1 2010Dec 4 2010

All Science Journal Classification (ASJC) codes

  • Business, Management and Accounting(all)
  • Computer Science(all)

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