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Google_2012

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bryan luu

on 22 June 2013

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Transcript of Google_2012

Google
Bryan Luu
Cindy Nguyen
Vanessa Tang
Sophia Ponomareva
Eric Nguyen

CSUF 2012
Vision Statement
2008
Mission:
To organize a seemingly infinite amount of information on the Internet, and make it useful worldwide.

Vision:
“Information available for all, everywhere, anytime.”

Goals, Objectives, and Strategies
Goal #1: To lead the industry in internet advertising (AdShare, AdSense, Banner Ads, Video Ads)
Strategy: Product Innovation. Increased Research & Development.
Goals, Objectives, and Strategies
Goal #2: How to best capitalize DoubleClick banner ad management program, dMark media auctioning system, Youtube sharing network and how to increase its share of search based ads in emerging markets.
Objective: Increase revenues from DoubleClick, dMark, and Youtube acquisition by 35% by 2010
Strategy: Expanding Google's presents into the emerging countries, increase international search revenues with the $140 million acquisition of ZAO Begun
Adwords/ AdSense are Google’s main source of revenue.
Cost-per-click pricing
Text advertisement are short
New two types of ads
Images
Videos
Main competitors are Yahoo Search and Microsoft adCenter
Strategic Business
Advertisements are based on
Search terms
Clickstream
Content
Example: Gmail scans the content of messages to serve up text-related ads
User location
Strategic Business
Strategic Business
Google competes using different strategies; main targets:
Users
Advertisers
Google Network members and other content providers
The computer, consumer services, and internet industry reached a total of 1.7 billion users in 2008; generating total revenues of $819.2 billion
Financial
Google has grown immensely and is still growing with sales from 7.2% in 2003 to 25.3% in 2007
Results primarily from growth in advertising revenues

Google’s net income at $106 million in 2003 to $4.203 billion in 2007
Financial
Financial
Financial
Competitors in Market
Google currently controls 62% of the domestic market (based on the number of searches).
Yahoo is at 20.4% of domestic searches performed.
Microsoft ranks at 10% of domestic searches.
Ask accounts for 2.8%
Competitors in Market
One of the original giants.
Broadband internet/advertising are main revenue sources.
Yahoo in decline.
Cooperative deal with AOL, Microsoft.
Competitors in Market
Microsoft-World’s leading software company
Windows, MS Office, MSN, and Bing.
Video Game with X-Box
Mobile device market-Windows Phone
SWOT
Analysis of Core and Distinctive Competencies
Core Competences
Research & Development

Product Innovation
Analysis of Core and Distinctive Competencies
Distinctive Competences
Maintain the best reputation in the industry by setting high standards, and continuing to produce superior products & services.

Ability to maintain strong relationships with Internet users, advertisers, and Web Sites
Industry & Competition Analysis
Define Industry
Economic Features
Driving Forces
Industry Key Success Factors
Industry Tends
Five Forces Analysis
Competitor Analysis
Define Industry
Computer: Consumer Services and Internet Industry

Infrastructure of the Internet
Web hosting services
Hardware
Software
Access services

Source: Standard and Poor’s Industry Survey, September 2008
Economic Features
Market size: 2000 360 million users and 2008 1.5 billion users
Market growth: 24% within 8 years





Source: Google Strategy in 2008, Case 14
Economic Features cont.
Number of rivals: large number of companies of varying sizes competing
Learning/Experience curve effects: requires skilled development/ programmers and qualified employees.
Pace of technology changes: rapid technology changes
Degree of product differentiation: operates in a diverse range of market

Source: Standard and Poor’s Industry Survey, September 2008
Driving Forces
Rely on network members for significant portion of revenue
Effectively manage growth, business, and operating
Proprietary document format
New technology development
Talents and efforts of highly skilled individuals

Source: Standard and Poor’s Industry Survey, September 2008
Driving Forces cont.
Internet access provider
Government regulations
Global economic crisis
International operations increased risks and challenges


Source: Standard and Poor’s Industry Survey, September 2008
Industry Key Success Factors

Quality/ product performance
Quality/ reliable information
Reputations/ image
Attract and retain relationships
Improved search algorithms
Product innovation/ expertise in technology
Global distribution capabilities
Trustworthy
Mobile devices

Source: Standard and Poor’s Industry Survey, September 2008
Industry Trends
Challenging traditional business models
Healthy growth devices
Evolving world of online music
Online gaming
Far reaching benefits
Dark side of the internet

Source: Standard and Poor’s Industry Survey, September 2008




Substitutes
3





Rivals
-
Competitors are active in introducing new products
-High differentiation
-Aggressive moves by competitors
-Diverse strategies
1


New Entrants
3
Buyers
4
Suppliers
3
5-FORCES ANALYSIS

Ranking: 1-5
1=least favorable
5=most favorable
-Readily available
-Low switching costs
-Not better performers
-High demand
-Reputation
-Performance
-Existing industry members = strong candidates
-High barriers:
Economies of scale
Resource advantage
Experience
Customer preference
High capital requirements
Substitutes
3
5-Forces Analysis
Overall Attractiveness
=
2


Google
Strategic Group Map
Product Innovation
High
Low
Product Quality/Reputation
Low
High
Microsoft
Ask
Others
Aol

Yahoo
Source: http://r-rwebdesign.com/blog/?p=353
Weighted Competitive Strength Assessment



Microsoft



Ask



Aol


Google
Yahoo
Lower Cost
Differentiation
A Broad
Cross Section
of Buyers
Type of Competitive Advantage Being Pursued
Generic Competitive Strategy
A Narrow
Buyer Segment
(Niche Market)
Market Target
Major Problems/Issues
Strategic problem: No sense of direction
Cause:
Not focusing on its core business
Trying to grow too fast by getting involved in too many acquisitions
Playing catch-up with the competitors
Too much diversification
Impact:
Unable to put effective use of resources on acquisitions that have the potential to generate revenue and fully embracing those acquisitions 
Not differentiating themselves
Major Problems/Issues
Strategic Issue: Weak position in China. Google is a distant number two to local search-based ad provider Baidu.
Cause:
Google holds a small share of internet searches in China (Baidu - 63%, Google - 26%)
World’s fastest growing market for search-based advertising in 2008
Emerging country (over 300 million)
Impact:
Not entering into new emerging markets
Letting competitors take over the new markets first
Problem: No sense of direction
 Alternative 1: Dropping poor performing acquisitions and focusing on stronger performers.

Drop: Orkut
Concentrate on: YouTube, Double Click
Pros:
Reducing waste of resources
Focusing on development and improvement of strong performers
Improving quality and performance
Cons:

Upsetting existing customers
Loosing the market
Not giving it an opportunity for growth
Problem: No sense of direction
Alternative 2: Due to lack of direction re-evaluate the strategy, mission, and vision
Pros:

Gain a better understanding of how to compete more effectively
Gain a better sense of direction that the company needs to take
Focus on competitive advantage
Cons:

Time consuming
May lead to completely new strategy, vision, and mission
Educating, informing, and training employees
Problem: No sense of direction
Alternative 3: Hire a new CEO and have the two founders become chairmen


Pros:
Help guide google with direction of what and where they should be heading towards the future
New CEO can help open up new ideas from past experiences with other companies
Cons:
Founders may be resistant to let someone else control the company that they created
New CEO may have the same values and believes as founders on how to run the company
Issue: Weak position in China
Alternative 1: Introduce Android into Chinese market
Pros:

Big market with Android-compatible phone users (LG and Nokia)
Capture a wider market share
Global Expansion

Cons:

Local policies/laws
Cultural differences
Possibility of damaging Google’s image in case of failure
Issue: Weak position in China
Alternative 2: Collaboration with Baidu
Pros:

Low risk of failure
Less exposure to new regulations and tariffs

Cons:

Clash of interests
Increasing Baidu’s benefits and decreasing its own
Issue: Weak position in China
Alternative 3: Establish a separate entity based in China
Pros:
Lower risk of failure
Catering to local trends and preferences better
Lower risk of damaging the reputation of Google under a sister company name

Cons:
Advertising costs
New regulations/policies/tariffs
Tradeoff Analysis
Recommendations and Implementations
Best alternative for problem: Drop poor performing acquisitions, focus on strong acquisitions
Week 1:CEO should present this idea to CFO to Identify how acquisitions perform
Week 2: CEO needs to present it to the board of directors
Recommendations and Implementations
Best alternative for issue: Create separate entity; Think local, act local
Week 1: Research the market
Week 5: Work with financial department
Week 6: CEO presents to the board of directors to get approval
Week 7: Hiring a real estate agent from China to find a office space to operate the new entity
Best alternative for issue cont.
Week 11: HR department sent to China
hire local personnel
local market trends
new client base
collaboration
market
regulations and policies
IT team works on web site
Week 35: Site up and running
Comparison in 2007
Competitors in Market
AOL is the world’s leader in interactive services, Web brands, Internet technologies and e-commerce services
its merger with Time Warner-the world’s leading media and entertainment company
AGENDA
Company Background

Mission Statement/Vision

Goals/Objectives/Strategies

Business Model

Company Performance

Management Characteristics
SWOT Analysis

Core and Distinctive Competencies

Industry and competitor analysis

Major Issues/Problems

SARS Analysis

Recommendation and Implementation
COMPANY BACKGROUND
Milestones/Critical Events
Milestones/Critical Events
Detailed Description of Business
Offer products and services that benefit users and let them find information quickly and easily.
Google offer products beyond than just search,
Products and Services
Products and sesrvices include:
google web search
web page
movie, music, video and weather
News, Finance, Maps, Images
Blog

Applications:
google docs
caldendar
gmail
Blogger
youtube
finance
book search
Orkut
Google talk
Client:
google toolbar
google chrome
picasa
google desktop

Google GEO- Maps, Earth, and Local

Google mobile and Android
google mobile
google maps
blogger for mobile
android
GOOG-411
Value
Proposition
Google Business Model
MANAGEMENT Characteristics
Top 10 Principles of Google's Philosophy
1. Focus on the user and all else will follow.



2. It's best to do one thing really, really well.



3. Fast is better than slow.



4. Democracy on the web works.



5. You don't need to be at your desk to need an answer.
6. You can make money without doing evil.



7. There's always more information out there.



8. The need for information crosses all borders.



9. You can be serious without a suit.



10. Great just isn’t good enough.   
Full transcript