Google: The business strategy
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Google is undeniably one of the most influential companies in the world. This American multinational technology company has also been one of the prime shapers of the digital information age. It has introduced several innovations through its varied Internet-related and technology-related services and products that changed the way people use the web by promoting the easy dissemination of information and the creation of content.
The Internet giant is without a doubt an American business success story. Of course, understanding how Google has become one of the biggest companies in the world requires an appreciation of its overall business strategy.
PRODUCT STRATEGY OF GOOGLE THROUGH PRODUCT AND SERVICE DIVERSIFICATION
Online search has always been the main service and product of Google. The company initially capitalised on its search technology that it began developing since 1996. But it later diversified to different Internet-related products and services.
These include productivity tools such as Gmail and Google Drive, enterprise products such as Google Search Appliance, online advertising and publishing services such as AdWords and AdSense, and other online services such as Google News, Google Translate, and Google Maps, among others.
The varied Internet-related products and services have enabled Google to corner diverse Internet users and make them dependent to a certain extent. Take note that these products and services are complementary, thus benefiting users due to ease of use from familiarity and hassle-free transition using a single all-access account.
Diversification is an effective business strategy of Google because it has allowed the company to create new markets and retain existing customers or users, thereby creating a general consumer base of Google-dependent Internet users. Furthermore, diversification has enabled the Internet giant to position itself as a one-stop venue for all Internet-related needs.
EXPANSION STRATEGY OF GOOGLE THROUGH COMPANY AND PRODUCT ACQUISITIONS
The Internet giant did not only diversify by developing original Internet-related products and services. Like any other companies with deep pockets and established industry influence, acquisition has always been a notable business strategy of Google because it has enabled the company to expand to different technology-related ventures.
Google has successfully expanded its Internet empire through several large-scale acquisitions. One of these includes a USD 1.65 billion stock deal to acquire YouTube in 2006. It also acquired SkyBox Imaging June 2014 at USD 500 million to obtain its satellite technology and improve the accuracy and clarity of Google Maps. Google also extended its online advertising business when it acquired DoubleClick in 2007 at USD 3.1 billion.
The acquisition of the Android mobile operating system in 2005 at USD 20 million is another notable business strategy made by Google. This acquisition was partly responsible for popularising the smartphone and tablet markets and for helping Google establish its firm grounds on the mobile landscape and mobile markets. Android, after all, has allowed the company to extent Internet-related services and products to mobile users while also exploring other mobile-related technology ventures.
As an expansion strategy, acquisitions have enabled Google to enter new markets and improve existing market shares. Moreover, as a technology strategy, these acquisitions have allowed the Internet giant to improve its technological capacities by empowering existing products and services and exploring other valuable technology-related ventures. These acquisitions have allowed Google to corner the diverse market of technology-dependent consumers.
REVENUE STRATEGY OF GOOGLE THROUGH ONLINE ADVERTISING
Online advertising is at the core of Google. The Internet giant generates billions of dollars from advertisers that buy or place advertising spots on varied online platforms through different agencies or ad networks. Note that more than 90 percent of the total revenue of Google comes from online advertising.