Hidden Revenue 21#
The logic that the user is responsible for the income of the business is abandoned. Instead, the main source of revenue comes from a third party, which cross-finances whatever free or low-priced offering attracts the users. A very common case of this model is financing through advertisement, where attracted customers are of value to the advertisers who fund the offering. This concept facilitates the idea of 'separation between revenue and customer'.
Examples: Iconic Cases
How they do it: As Hotmail drove a lot of traffic on its website from its email users, it monetized that traffic with ads. These include sponsored articles, as well as display ads. The core product remained free to the user but Hotmail generated revenue from advertisers.
Learn more about Hotmail →
How they do it: JCDecaux allows its customers to advertise in the public space. This includes street furniture, public transport and billboards. The audience of JCDecaux’ products are the people who use these services. However those people don’t pay money to JCDecaux. On the other hand JCDecaux markets the people’s attention to its clients who pay money to the company to advertise to the people. This money generates revenue for the company and pays for the physical infrastructure.
Learn more about JCDecaux →
How they do it: In 2014, Pinterest generated its first revenue, when it began charging advertisers to promote their products to the site’s millions of users, consisting of hobbyists, vacation planners, and do-it-yourselfers. It generates revenue by displaying advertisements in the form of “Promoted Pins.” Promoted Pins are based on an individual user’s interests, things done on Pinterest, or a result of visiting an advertiser’s site or app (via re-targeting).
Learn more about Pinterest →
How they do it: Twitter does not charge its users for accessing its platform or using its mobile apps. Rather, advertisements are shown periodically, and brands may pay Twitter a fee to promote their tweets sl that they appear more prominently throughout users’ newsfeeds.
Learn more about Twitter →
How they do it: Brainpool’s video-on-demand platform MySpass is available for free but financed with video advertising (comparable to traditional TV advertising).
Learn more about Brainpool →
Below, the top industries for the pattern "Hidden Revenue" are displayed, in order to get insights into how this pattern is applied across different industries. We've collected data from 5 firms using this pattern.
Top Industries
67% of firms using pattern
26% of firms using pattern
18% of firms using pattern
All Industries
Below, the pattern "Hidden Revenue" is analyzed based on co-occurrence, in order to get insights into how this business model pattern is applied in combination with other patterns within the firms we studied.
Top Co-Occurrences
11 pattern co-occurrences
7 pattern co-occurrences
6 pattern co-occurrences