Case Study on Google Inc.

Submitted by,
Harjas Kaur 231062
Kanika Jain 231073
Mahak Agrawal 231084
Naveen Suman 231094
Priyanshu Jain 231104
Pranay Goyal 231114
1. KEY FACTORS BEHIND
GOOGLES EARLY SUCCESS
EXPANSION:
Since its IPO, Google launched a flurry of products that
expanded its domain beyond web search. These included Gmail,
Google maps, Google books and so on.
Google launched book search, maps, email, calendering,
document management systems threatening ebay, amazon, MS
office, windows
Google tried to maximise its services.
CLICK THROUGH RATE(CTR): Google weighted CPC bids by the
ratio of an ads actual click-through rate to its expected CTR.
This maximised googles revenue since an ad with high CPC bid
but a low CTR offered low revenue
Googles network offered more search traffic and allowed lower
minimum CPC bids.


CONTEXTUAL PAID LISTINGS AND FROOGLE: Google expanded
beyond search advertising by launching Adsense and Froogle- a
product search service that identified merchants for specefic
products along with their prices.
Google added paid listings to its various services like maps too.
Google prevailed in a series of key deals in competing to buy
placements on partner sites.eg- 2005 bidding war with MS for the
right to show googles ads on AOL search results.
PERSONALISED SEARCH: Googles engineers constantly fine tuned
search algorithms. In 2004, google launched personalised search
which ordered results by analysing a users prior searches and
clicks.
Google realised there was a oppurtunity in attracting more local
advertisers since google could focus their ads on right regions.
GOOGLE ANALYTICS: Google improved its advertiser features by
offering advertisers free software to optimize paid listing
campaigns.
Google followed unconventional methods to manage innovation
and had strong & distinctive corporate values.
2. Will Google employ the
winner take all approach?
In Search Engine Business: Chances are High.
Market Share of Search Engines :
Google: 90%
MS Bing: 4.5%
Yahoo: 3.2%
Baidu: 0.7%
Others: 1.6%
Other Major Products:
Mobile
Web browser
Video host (You tube)
News
Docs
3. Bid for AOL
Google VS Microsoft
In 2005 Microsoft and Google entered into a bidding war for an alliance with
AOL where both were bidding to gain from AOLs sales team and to provide the
search engine platform to AOL
Google won the battle and bought 5% stake in AOL for $1billion.
Google also provided AOL $300 million credit to post its display ads on
Google's search engine thereby helping it promote its business.
Why Google over Microsoft?
Association- In 2002 AOL trusted Google and announced a switch to Google
for its algorithmic search results and paid listings.
Google was a company that was rapidly increasing and within few years of its
inception overtook the established players like Yahoo and Microsoft. Google
started in 1999, surpassed market share of Yahoo in 2004 and as of 2009 had
65.6% market share of search engines.
AOL would be able to make use of the Google platform to boost the traffic on
AOL network.


4. GOOGLES DISTINCTIVE CORPORATE
CULTURE AND STRUCTURE AS
STRENGTHS
No Googler hesitates to pose questions directly to Larry or
Sergey in the weekly all-hands meetings. Every employee is a
hands-on contributor, and everyone wears several hats.
Googles mission statement and corporate culture reflect a
philosophy that you can make money without doing evil and
that work should be challenging and the challenge should be
fun.
Work Culture at Google -focus on creating a university
environment within the office.
Quality of Work life is aimed at Google by providing Freedom
to flex work hours to accommodate family life while still
meeting organizational goals; freedom to have a healthy work-
life balance; freedom to do things differently .

Presenting Ideas Before Hierarchy -Google believes that ideas and
innovation can come from anywhere. Physical spaces like shared
offices, long caf tables, and break-out areas are specifically
designed so ideas tossed around during casual conversation could
become one of the next big projects for the company.
Freedom to Innovate: criteria of building innovation into
management.
It encourages creativity allowing all its engineers to spend 20% time
on the product of their choice.
They know how to set the priorities right. Management used
70/20/10 rule for allocating time and efforts wherein 70% time to
web search which is the core business, 20% to the projects that
extended the core and 10% on fundamentally new business.
Google believes in democracy on the web works, , thus allowing
sharing of links on its websites

5. Google have 4 Alternatives to
Venture into
Portal Building
Consolidating content
Up to date and subjective searches
Classified by relevance
Focus on Comparative Advantage:
Develop superior search solutions + monetizing through
targeted advertising
Make it the trusted third part info escrow agent for all
the world business
In line with its aim of organizing all of the worlds
information
Extend Functionality
Compete head on with Microsoft as rumored
Desktop searches, office alternatives (provide support to
development of open source initiatives like Open Office)
Provide interfaces compatible with Linux users to extend
market base
E-commerce
Build trusted networks to provide intermediary function
as an online payment inter phase (like PayPal)
Extending to purchasing journals, copyright articles via
Google Channels.
Why not build their portal?
According to Eric Schmidt, CEO of Google, Google is not in the
portal business.
Data also show that using websites as portals is the least
important factor for respondents (internet users), among
factors such as relevant results, speed of website, best
features and the way results are presented.
There are already 2 big players in the Portal business, namely
Yahoo! and MSN, due to high market commonality and high
resources similarities, Google should practice mutual
forbearance and not enter the portal business to prevent
counter attacks by Yahoo! and MSN.
Yahoo! has first mover advantage- loyal customers, who may
find it difficult to switch to another portal format. Google may
find it difficult to take the market share away from them.
Why build their own portal?
Google has enough expertise to enter portal business.
Portal can be use as a complement service to their search
engine.
May be a relatively easy investment.
Why not focus on ecommerce?
Already has big player PayPal and eBay

Next big thing
Have enough capabilities to create a payment service
Because Google Wallet is coming out
Competitors are not into it yet
Why focus on ecommerce?
Why not build their own OS?
Not consistent with Googles philosophy
Its best to do one thing really, really well
Google does search best
Difficult to compete with Microsoft
Microsoft already has positive feedback loop
High installed base of users
High switching cost

Possible in the long run
Given that Google gain the technology

Why build their own OS?
Google : Porters 5 Force
Model
Bargaining Power of Suppliers: Low
Bargaining power of suppliers should remain low as
long as Google maintains market dominance.
Generates most of income from Ads, both the
advertiser and the receivers are clients of Google.
Suppliers have faith in Google because of its amazing
products and services, like Android OS, Moto Series,
Nexus series, Youtube, Google Earth, etc.
Google : Porters 5 Force Model
Cont
Bargaining Power of Buyers: High
Buyers power is High in both Internet and Software
industries as there are many competitors who
provides same services as Google does.
Due to open source products, Google mainly rely on
advertisement for its revenue and hence a drop in
buyers may cause in drop in advertisement clients.
Google : Porters 5 Force Model
Cont
Competitive Rivalry: Moderate
Google has competitors in search engine like, Yahoo,
MSN, but still Google is the most popular search
engine. With innovations like Google Earth, Street
view, Google owns large majority of Internet services.
After launch of Android OS, Google came into
competition with Apples iPhone.
Google : Porters 5 Force Model
Cont
Threat of Substitutes: Low
The Internet has become the primary source of
information and in current scenario, there is no
substitution for Internet. With such a commanding
presence, Google has itself positioned for long term
success on the internet.

Threat of New Entrant: Low
Google has low risk of new entry threat as there is
high level of entry barriers.
Requires massive starting capital to build a startup
network infrastructure to compete with all products
and services of Google.