CASE STUDY: Google Takes on the World 1. Evaluate Google using the competitive forces and value chain models. 1.1 Value Chain Analysis The value chain is a systematic approach to examining the development of competitive advantage. The Google's chain consists of a series of activities that create and build value, the mission is to organize the world's information and make it universally accessible and useful. Innovations in web search and advertising have made the web site a top internet destination and Google brand is one of the most recognized in the world.
The quality of service provided by the Google organization and retaining qualified help is also an operating issue.) Opportunities: Unmapped countries expanding services (potential for unknown regions) New advertisement format and tracking mechanisms (new innovation of technology) Size of current customer base and market share is small (potential growth and new advertising agreements) Step 3. Assessment of the Internal Environment. This section of the strategic environment is a realistic analysis of Google's internal resources. Strengths: Search engine differentiation (Google’s strategic are innovation and concentric diversification) Employee focus (Google has a unique culture and policies to promote innovation.
Google announced $55 billion in total revenue for 2013, which is 189th on Forbes 500 list, the majority coming from advertising (Google Investor, 2014). On top of this their profits exceeded $15 billion. Despite a narrow revenue stream, Google’s broad product range is also a measure of their success. Part of the strategic developed of the company has been through diversification. This has been achieved through commitment to a policy of bold and aggressive acquisitions, currently they hold over 100 products in their portfolio.
Advertising has been expanded to much more than the pay-per-click variety with webmasters bidding on keywords, placement and pecking order. Financially speaking, the trend is continued revenue growth with no sign of slowing in the near future. Revenue in the first quarter of 2005 was nearly double that of Q1 2004, at $1.26 billion versus last years $652 million figure. It is easy to see why Google Inc. is so optimistic about their future and possibly a bit arrogant.
This completely contradicts Google’s first and second principles, “do what’s best for the user” and “provide the most relevant answers as quickly as possible”. The truth is, Google makes most of their income on adverstising and has acquired many companies in order to become a titan in that industry, and with Google’s unignorable control in the search market, it is to no surprise that the company has used its influence to be more biased towards things that would increase its wealth. Brin and Page are not the only ones with this mindset; it turns out that VP Marissa Mayer, former executive and key spokesperson for Google, has confessed during a Seattle Conference on Scalability that “... ... middle of paper ... ...e graph to contrast Gmail and Yahoo!’s email user was found to be surprisingly difficult and provided unrelated results: a link to “A List of Mergers and Acquisitions” on Wikipedia popped up as the second choice when typing in the key words “google vs yahoo email graph” into the search bar. When one searches for maps, Google presents Google Maps in 1 in 13 search results, while MapQuest and Yahoo! Maps seem nonexistent.
excels in among its industry competitors is its distinctive competencies. They are defined as, “firm-specific strengths that allow a company to achieve superior efficiency, quality innovation, and responsiveness to customers,” (Hill, Jones, Schilling, 2013). Name recognition is one of Google’s strongest distinctive competencies. The word Google has become a synonym for “search” which has increased Google’s status as one of the most widely known search engines on the Internet. Another distinctive competency of Google’s is its human resources department.
An example is the use of Googles web browser which will encourage customers to try Googles own mobile phone and operating system. One exciting experience of a customer on one of Googles product or service would in no doubt give rise to customers searching for other products that are Google related. A culture of innovation which is the underlining culture of Google is responsible for the exceptional and unique products that they offer yearly. Googles innovative work culture is one of its main competitive advantages. This is reflective in the work culture that it currently exhibits.
T... ... middle of paper ... ...roducts like High Speed Internet, Application softwares, online auction etc. To do so Google can merge with AOL or Time Warner Cable to provide High Speed Internet services to its clients. Google has also begun testing a free online-classified service, Google Base, in a move that could be considered a direct challenge to online auctioneer eBay. Google has also launched a web-based Spreadsheet program that will allow people to view and simultaneously edit data while conducting "in-document" chat. Conclusion As the world is getting more competitive every day, no company can rest assured of its success.
The five major competitors are Yahoo!, MSN, Baidu, Bing, and AOL. o Bargaining power of buyers- in both 2007 and 2008, 97% of Google’ revenues came from advertising alone and the 3% was from other businesses. The advertisement customers have bargaining power because Google relies on its advertisement turnover too much. In addition, since this industry is relatively new, there are still growth opportunities for Google’s current or potential competitors which result in high bargaining power of buyers. o Bargaining power of suppliers- talent people are Google’s suppliers.
It is very essential that Google choose the correct monitoring systems will be crucial to the sustainability of Google’s success. To continue their dominance against yahoo and Microsoft, they most dedicate themselves by finding the employees that will provide a unique advantage against their competitors. This will help drive loyalty from target market and provide a competitive advantage. Google’s implementation plan can pin point focus on variation on their primary product of search services but provide a competitive edge by providing faster times, greater scalability, and decrease pricing to their advertising consumers.