Basic Waypoint usage

I'm trying to use the Waypoints plugin for jQuery to lazy load elements on a webpage. However I can't get it to work. :(

I made a very basic example: http://jsfiddle.net/P3XnN/2/

According to the Waypoints documentation all I need to do is the following.

JS:

$('#waypoint').waypoint(function() {
   alert('You have scrolled to my waypoint.');
});

HTML:

<div style="height: 500px">Scroll down</div>
<div id="waypoint">Waypoint</div>

But it isn't as simple as that apparently. Please help.