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Google Case Study

Presented by: Team E

Lauren Dehoff

on 16 November 2013

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Transcript of Google Case Study

Lauren, Maddy, Jacey, Hannah, Karine
Team E

Business Model
A look at the finances from 2005 to 2009 and present.
Google has
main Revenue sources
Google Websites
Google Network Websites
Licensing and Other Revenues

Revenues from 2001= $86,426 to 2009 Rev of $23,650,563

very strategic decision by Google,
Revenue Sources
Dominance in Internet Advertising
Constantly exploring new industries
-TV, Cloud Computing, Mobile, Maps

Very effective in managing operating costs

Advertising Revenue differentiated Google from competitors and exploded revenues

Use cash reserves effectively to acquire new companies and research opportunities

Rely on very little debt to finance assets

Integrate search engines flawlessly to all components (intranets, mobile)
Extraordinary Growth Rate
Google sees another large spike in Revenue from
2007 to 2008

-The release of Android
-Acquisition of DoubleClick
-Youtube advances from 2006
-Google Check Out

Global Affect:
Google understands International Markets. 50% revenue from outside the US in 2009
Financial Growth
Google Compared to S&P500
A Smart Investment
- Business model capable to generate revenue

- Profit-driven

- Advanced Technology

- Effective Competitive Strategy

- Acquisition and alliance to integrate immediate industry

- Focus on Customer
Who are the main competitors?
Chaos-Unique Culture

Flexible Environment

Involve and Maintain All Human Capital

Customer Value Proposition

Profit Formula
Business Model
Enhanced and Open Testing

High tolerance for failure

Continuous Improvement and Innovation
Business Strategy
-Advertising Overload

-Need to look for another revenue source

-Mobile Phones

-People have become too dependent on the internet
How is the Search Industry Changing?
-Competitive Rival Sellers

-Supplier Bargaining Power
What Forces seem most likely to bring about major change to the industry within the next 3 to 5 years?
- Yahoo and Microsoft

-Perfect Search Engine Technology: Make Faster/More Accurate

-Watch what competitors are doing: Semantic Search Technology
Competitive Rival Sellers
-Stay attractive to customers with Innovative technology
Example: Google TV and mobile phones

-Maintain Strong Relationships
Supplier Bargaining Power
-advances in technology and increase Internet advertising

-Find additional revenue sources

-Explore financing options

-Create a Homepage

Chinese Market
Brand Image
Page content
Gain market share in mobile market

Russia and China

Advertise Google products

Create a “homepage”
Yahoo, Bing, Baidu, Yandex


Favor ability over experience
Company Culture
Global Presence
Expansion to other markets
Competitive advantage
Stocks/Market share
U.S. Search Engine Market Share Rankings
July 2006, June 2009, and May 2010
search industry
is based on maintaining a strong relationship with Internet users, advertisers, and websites
Google's primary competitors within this industry are
Microsoft and Yahoo have come to an agreement that has made Microsoft Bing, Yahoo’s imbedded search engine.
This agreement has allowed the company to achieve the advertising amount necessary to make its online services business profitable, as well as increase its Internet search market share.
Other competitors within this industry consist of
, and several other companies.
Google, Yahoo, Microsoft
Key competencies, capabilities, and resources of
successful search engine companies
Competive advantage
Bargaining Power of Buyers
Bargaining Power of Suppliers
Threat of Substitute Products and Services
Threat of New Entrants
Rivalry Among Existing Competitors
Porter's Five Competitive Forces
-Strong relationships with Internet users, Websites, and advertisers
-Human Resource
-Business Model
-Google's Search Engine
-To give the exactly result users wanted
-To generate new initiatives or integrate good ideas into new business and technologies
-To create high volume of traffic and, consequently, a massive market access potential for advertising
-To increase revenue while reducing cost for advertisers and customers
-Product and services that significantly improve people's lives
Competitive Advantage
Competitive Advantage
Bargaining Power of buyers:
Advertising is the majority of Google’s revenue
Google’s increase in advertising has attracted many buyers.
As long as the demand is high, the bargaining power of buyers will remain low.
Threat of Substitute Products and Services
The threat of substitution is low since there is not a substitution for a search engine.
The low switching cost in the industry makes switching between search engines relatively easy.
Google must continually have accurate and quick results in order for buyers and suppliers to remain loyal
Threat of New Entrants
Threat of new entrants consists of high barriers.
Current search engines such as Google, Yahoo, and Microsoft all demonstrate a significant amount of knowledge about the industry.
The threat of new entrants is extremely low because new entrants would have to develop a higher speed search engine, as well as expand technology.
Customer loyalty is another factor that reduces the likelihood of new entrants.
Rivalry Among Existing Competitors
Competitive rivalry in this industry is extremely high.
Since all competitors have similar services and products, competition is mainly based on the quality of their search engine features.
In order for Google to stay ahead of their competitors, Google must constantly improve its service.
The search industry is an attractive industry for companies that can overcome the entry barrier
The advances in technology and the increase of Internet advertising are the two key components that allow companies to prosper within this industry
Another reason why this industry is attractive is because it is relatively easy for companies to attract people since there is a low switching cost
Industry Attractiveness
Bargaining Power of Suppliers:
Consists in the trust of Google’s ad system as a reliable source of income.
As long as Google is dominant, the supplier bargaining power will remain low.
Strongest and Weakest Forces
Strongest force is competitive rivalry
Weakest force is the bargaining power of buyers
The rivalry among competitors is constant since Google, Yahoo, and Microsoft are constantly growing.
New applications are invented every day in order to maintain a strong competitive advantage.
The power of buyers is weak because Google’s product delivers quality advertising that is not matched by other brands.
-Yahoo’s web portal
-Yahoo Messenger,
-Games, etc.
-Partnership with mobile phone operators
- To host site for small business and internet retailers
- To generate revenue from different sources
- Internet Explorer
- Microsoft Windows
- Powerset.
- Search Website BING
- Microsoft Office
- SkyDrive and Azure
- Human Resources
- Computer software, consulting services and video game hardware
- Semantic engine technology that gives high relevancy results
- To earn large revenues with online services
- To reduce capital expenditures for software upgrades and add server capacity
- To provided data security in the event of natural disasters such as hurricanes with the cloud computing
It has the leader browser, great product and advanced technology of cloud computing
Online services, content and data
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