Analysis of the Corporate Strategy of Google - Case Study Example

The corporate strategy of Google Inc Google Inc What’s the Corporate Strategy What is Google’s corporate strategy? Does Google have a clear vision of what it wants to become? Google is one of the world publicly traded multinational organization that is constructed around the company’s hugely popular search engine. The company has other enterprises, which include internet analytics, advertising technologies; cloud computing, web app and browser and lastly operating system development. It was founded in 1995 by two graduates Sergey Brin and Larry page, today it is a referral point for information in the world, it has become so dominant that it is no web search can be conducted without mentioning it, people are as likely to say they Goggled while searching for it hence achieving its mission of “to organize the world information and make it universally accessible and useful (Chaffey, 2010). A corporate strategy is plans designed to achieve some specific or particular goal; otherwise it is cooperation scope and direction geared towards various business operation working together to achieve set goals. Google being information sharing company it require strict and laid down strategies which it should follow to ensure that it successfully progresses. This has made it have an experimental culture those empowers employees, but more importantly defending its core. This experimental culture can well be explained using a four part analysis (Rosen, 2008). The first part of the culture strategy is earn, then entice, defend and lastly to expand t Google’s 95% of its money come from advertising. Google has a very clear and distinct vision of what it wants to become. We dwell in the world that information is valued so much due to increase in intelligence, communication technological information, innovations and education, though organization and compiling of this information that need to be shared out Google comes into safe the world (Rosen,2008). 2. Evaluate Google’s diversification into new products and businesses, with particular reference to (a) browsers (Chrome), The company revenue income in its ads is slowing down despite its continuous innovation and introduction of new services and products. This creates a bad picture for the company forcing it to look at other revenue streams to sustain growth. Advances are made, and others already made to launch chrome cast during the quarter this is mainly to see that Google dominates the market with less or no major competitors (Chaffey, 2010). Google generates higher percentage of its value from advertising where it competes primary with Microsoft, yahoo and facebook according to research and estimates, standard PC search ads accounts for above 30% of it total value and 60% of revenue. This however, recent trend in earnings indicates a decline in the online PC ads revenue while the market place has been stagnant at 67% as per Comscore data. Nevertheless standard PC search continues to be the cash cow for Google where the company is now exploring new avenues to boost market share in PC search and division. The strategy to maintain its dominance in PC search the company is trying to tie up with original equipment manufacturers like (OEMs) such as Acer, Toshiba and HP, to launch the next generation of chrome book .this is an important development as the chrome book will route all search queries through Google by default, making Google improve market share if chrome book sales increase. With high domination share in the market, there is a high expectant that advertisers will keep on pumping funds on Google adverts (Chaffey, 20110). There is a high probability of PC ads revenue increase with the continued increase in the number of searched and resulting paid clicks. However revenue per search for PCs is also facing a decline as advertisers are increasing routing their budget spends towards mobile devices. Over the past years, Google has accelerated development around its browser-based chrome OS this has been done using and tying it together and synchronizing its different services. The company’s goal is come up with a web, users computing platform who want and are in need of using of information, entertainment, or productivity tool. The linchpin of this strategy has been placed to chrome browser (Rosen, 2008). Google has increased the number of chrome package apps which not only run in chrome users only but works efficiently offline in response to criticism that it has a limited functionality dependent on internet connection only. (b) Mobile phone operating systems (Android), Six years ago, Google launched, it has emanated in the manufacturing OS smart phone and decided to make half the phone which is just the software to run the device. Google planned to give its operating system a name, Android, to phone makers for free and also let them alter the OS in a way that they only liked. This was propelled by Google thoughts that the plan will benefit it in two ways: one free operative systems, would push phone makers to come up with better web-enabled phones, and two mobile better phones would make people spend a higher percentage of their time on the internet. More time in the internet means more opportunities to use Google products and services. Google made sure that I would retain some influences on the devices making people get used to get its services. If it was not for android people, would be using devices controlled by other companies like Apple, Nokia and Rim. The company entered in the lucrative mobile operating system in 2005 by the acquisition of android Inc after two years Google made an announcement of open handset alliance. As a result, the first smart to feature the technology was launched in 2008, T-MOBILEG1, through android –based phones which required the capable third generation (3G) wireless network in order to take full advantage of all the systems and features(Chaffey, 20110). (c) Mobile devices (Motorola). Mobile ads were noted as attracting more interest in adverts and agencies this showed that mobile ads were more effective than had been realized by making users to customers, thus more advertiser to bid mobile slots. However, there was a recorded hard evidence of the company profit as well a revenue. Rather, the company’s closely followed cost per click and it established that each time a user clicks on an advert there was a fall of 8percent from the earlier year. This was a deeper and steeper decline than Wall Street had been expecting and worst for a year. Inspire of some questions hanging over Google’s handling of the transaction to mobile, the company’s spontaneous growth continuously shows the benefit of smart phones and tablets to its business. Its paid clicks- the number of times users click on adverts-which is recorded to have jumped 26 percent, which is the biggest increase for a year which made advertisers try out other new platforms. As advertisers were flocking to the mobile application, this had made the company keep ut to date with profound changes in it followers. About 40percent of YouTube’s traffic now comes on mobile devices, up from less than 10% two years ago said Larry Page (Rosen, 2008). Google executives blamed the fall on factors that there was a rising proportion of cheaper mobile advertising this made analysts look to the indicators as a beneficial barometer of the mobile transition thus a signing up to the Google’s overall pricing power. Another indication that the company’s ambitious mobile strategy remains at work in progress that was the Motorola handset revenue declined by a third from year to $1.14 billion with the pro-forma loss edging up to nearly $250. This came during the quarter that saw the launch of the Moto X, the first handset designed and entirely under Google’s control and the device that the search company had said would prove it turn round Motorola, despite the question over some aspects of its mobile plans, its online adverts business generally took a big part of their income. It is currently estimated that mobile search ads contribute approximately a third of the firm value recent studies shows that mobile revenues doubled in 2012 which is also expected to rise, and the growth rate for ad revenue to be more than 400% between 2012 and 2016despite speculation that mobile ad will generate only 17% of the company total revenue in 2013, its expected the figure to reach almost 30% by 2016 Google continues to boost its mobile search capabilities through support of android operative systems application in mobile phones. Currently there are estimated 900million Android devices worldwide, and its share in the smartphone where the OS market is on the rise Other services that Google offers include different web based services that keep on attracting customers like Gmail, Google Drive (storage), Google Docs, Calendar, Maps, and Google+ social. These services inevitably start with a free ad-supported version for consumers. But, if they are potentially relevant and successful to business, it has packaged the products to different app bundles which are against other enterprises like Microsoft and others in organizations of all sizes (John, 2010). 3. Does Google need to refocus? How should Google delineate its corporate boundaries and which businesses or products would you recommend abandoning or selling (if any)? Other than these devices, Google is also targeting TV ad dollar with the launch of new services and devices such as chrome cast for you tube (Faktor, 2013). Taking into account of the explosive growth in online video ads spent, you tube has been factored as a key contributor to Google’s revenue growth going forward. High expectations are that unique user count for you tube will rise during the quarter due to the increasing popularity of the platform. Google has also made partnerships with prominent media studios has seen YouTube monetization. Google has been involved in strengthening and making its presence in urban household for a long time. Despite this success, some of its products have failed terribly like smart TV which delivered no results at all, while other attempts such as chrome cast dongle have mild success (Chaffey, 2010). Google with partnership with Net Labs currently manufactures a smart thermostat, which learns a user habits over time and adjust the temperature accordingly the device can profile human behavior and anticipate the user’s needs even before they know it. Researchers believe that google can be the next home based web this venture shall help the company to capture a bigger share of the $600 billion IoT market concerns are that when this technology is used which collect personal date will highly compromise people’s privacy though its much early to start speculating on products the Nest Labs shall develop under Google’s stewardship (Chaffey, 2010). By looking at Google’s strategy to earn it shows that the company has never stopped diversifying its product and revenue streams through fund generation from storage, business apps, and even you tube channels. When the company incur losses or speculates that a given venture shall have losses to the general company revenue, the company CEO always decides to sell the venture, this can be explained by the sale of Motorola Mobility Company. On the issue of entice and defend, it is understandable that people like cheap and free things. For the company so survive it offers a mix of free and cheap things, this is complemented by the continued non-stop inventiveness where every Google survive is a tantalizing and addictive mix of free and cheap utility that makes life easier and more productive. These utilities are placed in the market to provide high definition delivery ads (John, 2010). This implies that Google products must accomplish one of the following things, which are deliver ads to many users, this is done through Gmail or search engines, secondly, they should earn, through data collection to improve ad targeting. Products like Google, maps relationship analyzers, and preferences predictors create a new revenue streams and apocalyptic fears multiplies lastly the products should protect Google and its interest from competitors that might among these competitors are usage time, facebook, Spotify, net fix, iPhone and twitter have forced android Google+ and play into existence to defend Google’s share of internet time. According to Google, once inside no exit (Travlos, 2013). The expand strategy which is the most difficult strategy due to the existence of strong competitors, making it hard to find new customers. It promotes conversions and diversification in that one can use Google products and other types if products this is done by making its products compatible with other service providers (Ibson, 2005) Experimentation is a Google culture which ranges from Google X labs which houses top secret research and development projects, to all employees who are encouraged to use 20% of their time to work on anything they like. Goggle is not an adverting and marketing company its strategy is always what to stop doing the culture does not allow outsiders ever get near to the wheel. Google Company has been one of the successful company in the world for it attracts and retains sufficient talents from all spheres of the world. This expansion has also been attributed to attraction of talents from all fields and job family. Therefore, this attribute call for imitation from other companies from all over the world to attract and retain the top talent with innovation. This keep firm top in the industry with spontaneous growth and investor attraction. This should always be accompanied by reduction and doing away with low capability team that hinders capability of company growth and production of high margin products, as well as services (Rosen, 2008). Reference Chaffey, D. 2010. Online business and revenues models. Business article retrieved on 3rd Feb. 201. From:http://www.smartinsights.com/digital-marketing-strategy/online-business-revenue-models/online-revenue-model-options-internet-business/ Dransfield R. 2001. Studies in economic and business. Oxford, Heinemann Faktor, S. 2013. Deconstructing Google’s strategy. Retrieved on 3rd Feb. 2013, from http://www.forbes.com/sites/stevefaktor/2013/05/23/featuredeconstructing-googlersquos-strategy-will-google-eat-your-business-next/ John. L 2001 understanding corporate strategy. London. Thomson Learning, cop Travlos D. 2013, Google offers investors more than search and display ads. Business article retrieved on 3rd Feb 2013, from http://www.forbes.com/sites/darcytravlos/2013/05/23/what-is-google/ Rosen, Jeffrey 2008. Googles Gatekeepers. The New York Times. Retrieved July 5, 2010. Ibson, Owen; Wray, Richard , 2005. "Search giant may outgrow its fans". The Sydney Morning Herald. Retrieved November 27, 2010. Read More