This slideshare presentation by French consulting firm faberNovel dissects Google’s business model, analyzes strength and weakness in each of the markets they are involved with and brings clarity to how some services are loss leaders and how monetization happens from it’s connected product suite. Do take time to look at the page rank formula.
27 Replies to “Understanding Google’s Strategy”
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This is an excellent overview. Thanks for sharing.
Thought-provoking analysis. I’d come at it slightly differently though. I suspect Google’s strategy is 1. When you are the market share leader, grow the market, and 2. Gross Margin doubles for ads served on proprietary destinations. New product development, platform, partnership and acquisition tactics stem from there. So, for example, you index the spoken word to increase searchable content. You follow consumers/impressions to new platforms e.g., mobile to maintain overall ad share. You purchase (e.g., YouTube) and build proprietary products to increase saleable impressions. You buy DoubleClick to increase your saleable ad units and to ensure they are served at higher margins on your proprietary properties. You subvert closed, competitive systems with open standard solutions b/c you want people freely roaming, searching the internet where you have an advertising share advantage.
Interesting presentation. Puzzling about it, but I’m very curious to see how the future competition between MS and Google, Facebook and Google, and Yahoo and Google will unfold. All are in for some form of open identity management across sites.And for monetization of user data and mobile.
@Michael Downs It might be your right about proprietary products.It will be interesting to see if Google will maintain or develop an open strategy in sectors in which they are marketleader.
I saw an interesting presentation about LinkedNet in Zambia last wednesday in Rotterdam. LinkedNet is using all kind of Google products to share knowledge in local communities in Zambia. That might give Google a loyal userbase in Africa for the future, just as there Google.org initiatives aimed at Africa.
[.. Entendiendo la estrategia de Google .. ]
I’ve fleshed-out my comments above a bit more in a post entitled “On Strategy And Google”. I think it might help frame the economics around what is often seen as disparate Google initiatives.
http://adverclast.com/publishers/facebook/on-strategy-and-google/
Thanks for the interesting post 🙂
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