Google Inc - Revolutionary Business Model needs to Evolve
Google Inc - Revolutionary Business Model needs to Evolve
SUMMARY
Google is one of the world’s most valuable and respected companies, and one of the oldest Silicon Valley tech giants. Since its inception the Google has the largest indexing platform for web searches, powered primarily by revenues from advertising space and prioritization in its search results. Its wider ecosystem of products has been carefully built to capture as much attention as possible on the internet, for the ultimate purpose of driving ad-spend on its platform. However, these products’ uniquely free-use way of operating and reliance on data and advertising also make them part of the vulnerability of Google’s business model. The company needs to diversify to maintain its strength against fierce competitors.
KEY HIGHLIGHTS
SUMMARY
Google is one of the world’s most valuable and respected companies, and one of the oldest Silicon Valley tech giants. Since its inception the Google has the largest indexing platform for web searches, powered primarily by revenues from advertising space and prioritization in its search results. Its wider ecosystem of products has been carefully built to capture as much attention as possible on the internet, for the ultimate purpose of driving ad-spend on its platform. However, these products’ uniquely free-use way of operating and reliance on data and advertising also make them part of the vulnerability of Google’s business model. The company needs to diversify to maintain its strength against fierce competitors.
KEY HIGHLIGHTS
- Since it rose to prominence as a search engine, Google has frequently found itself with the capital to spin out new divisions across diverse segments. However, the aim of these divisions has always ultimately been to drive the data-collation and traffic which serves the company’s online advertising business. However, in the last decade disruptors have emerged in Silicon Valley which threaten to derail the way advertising works online, the system over which Google previously had a virtual monopoly. Whilst Google and its parent company have become renowned for their innovation, Google itself has a lot to fear from these disruptors.
- Amazon, Apple, Microsoft and Google itself are all building voice-controlled functionality into their products and services, including web search. Meanwhile, two players in particular have reached a scale comparable to Google’s, and are now beginning to seriously disrupt its previously watertight business model. These companies are Facebook and Amazon.
- As it tries to shore up against these and other threats, Google can at least rely on a huge amount of capital for new projects and expansions of its ecosystem. Core products are already diversifying, although the company’s forays into cloud services and hardware have had varying levels of success.
- Learn how Google's business model works
- See how its competitors are attempting to combat it's dominance
- Understand where its weaknesses lie
- Learn how Google is changing in order to adapt to competition
- How does Google's business model function?
- What are its key products?
- Who are the firms main challengers?
- What weakness does Google have?
- How does it need to adapt to overcome the competition?
1. OVERVIEW
1.1. Catalyst
1.2. Summary
2. DESPITE A WIDE RANGE OF PRODUCTS, GOOGLE IS STILL HUGELY RELIANT ON ADS
2.1. Search, Maps and YouTube are the core of Google’s ads ecosystem
2.1.1. Google Search is the world’s biggest advertiser
2.1.2. AdSense bolsters Google Search’s ad-revenues
2.2. YouTube has unfulfilled potential as the world’s second-biggest search engine
2.3. Google Maps contributes data for ads from offline activity
2.4. Chrome, Gmail and Android bring users into the Google ecosystem
2.4.1. Google Chrome is crucial to Google’s success despite being free
2.4.2. Gmail has a huge audience with low levels of monetization
2.4.3. Android pays for itself, but is also crucial to the wider advertising model
3. GOOGLE’S DATA-DRIVEN ADS MODEL FACES MULTIPLE THREATS
3.1. Voice search threatens to erase on-screen ads
3.2. Facebook has moved aggressively into Google’s advertising territory
3.3. Amazon is Google’s biggest competitor since Facebook
3.3.1. Aggression is built in to Amazon’s business model
3.3.2. It has become an effective search engine for ecommerce
3.3.3. Amazon is becoming less reliant on Google for ads
3.3.4. Amazon is competing with Google for more than search
3.4. Regulations could derail Google’s ever-growing data store
4. ALPHABET’S WAR CHEST AFFORDS GOOGLE NUMEROUS OPPORTUNITIES TO DIVERSIFY
4.1. Google Drive could move into the B2B market
4.2. Pixel phones and laptops remain important despite low impact
5. APPENDIX
5.1. Abbreviations and acronyms
5.2. Further reading
6. ASK THE ANALYST
7. ABOUT MARKETLINE
1.1. Catalyst
1.2. Summary
2. DESPITE A WIDE RANGE OF PRODUCTS, GOOGLE IS STILL HUGELY RELIANT ON ADS
2.1. Search, Maps and YouTube are the core of Google’s ads ecosystem
2.1.1. Google Search is the world’s biggest advertiser
2.1.2. AdSense bolsters Google Search’s ad-revenues
2.2. YouTube has unfulfilled potential as the world’s second-biggest search engine
2.3. Google Maps contributes data for ads from offline activity
2.4. Chrome, Gmail and Android bring users into the Google ecosystem
2.4.1. Google Chrome is crucial to Google’s success despite being free
2.4.2. Gmail has a huge audience with low levels of monetization
2.4.3. Android pays for itself, but is also crucial to the wider advertising model
3. GOOGLE’S DATA-DRIVEN ADS MODEL FACES MULTIPLE THREATS
3.1. Voice search threatens to erase on-screen ads
3.2. Facebook has moved aggressively into Google’s advertising territory
3.3. Amazon is Google’s biggest competitor since Facebook
3.3.1. Aggression is built in to Amazon’s business model
3.3.2. It has become an effective search engine for ecommerce
3.3.3. Amazon is becoming less reliant on Google for ads
3.3.4. Amazon is competing with Google for more than search
3.4. Regulations could derail Google’s ever-growing data store
4. ALPHABET’S WAR CHEST AFFORDS GOOGLE NUMEROUS OPPORTUNITIES TO DIVERSIFY
4.1. Google Drive could move into the B2B market
4.2. Pixel phones and laptops remain important despite low impact
5. APPENDIX
5.1. Abbreviations and acronyms
5.2. Further reading
6. ASK THE ANALYST
7. ABOUT MARKETLINE
LIST OF FIGURES
Figure 1: The core products and services of the Google ecosystem
Figure 2: Advertising revenues versus other revenues on Google’s balance sheet (2019)
Figure 3: Growth in volume of M&A activityin healthcare by segment (2007-20)
Figure 1: The core products and services of the Google ecosystem
Figure 2: Advertising revenues versus other revenues on Google’s balance sheet (2019)
Figure 3: Growth in volume of M&A activityin healthcare by segment (2007-20)
