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Strategic Analysis of Google

An Introduction to Google

Google was founded in 1998 by couple of students from Stanford University. Like many other businesses, a need of an efficient search engine was felt and there was a gap in the market which lead to the foundation of Google. Initially the company started as a basic search engine but sooner invented better ideas to sustain the market due to fierce competition with Yahoo, MSN and AOL. Today Google is having the biggest market share and a constant innovation coupled with strict recruitment policies is the key to success.

SWOT Analysis

Google is having numerous strengths but there seem to be few weaknesses while there are numerous opportunities and a great number of threats. Google’s strength lies in its huge number of proficient employees who are not limited only to US but throughout the world. Google is offering numerous services which competitors are only thinking of, these include AdWords, Google Earth and Google Wireless to name a few. Unlike many other search engines, Google identified the gaps in the market and worked on them to gain a greater market share. Google successfully took over many other businesses to help itself grow while minimising the future threats, this includes the acquisition of and inventing new service such as Google Toolbar. Google generates huge amount of profit from the AdWords and the best part is that the customers (other businesses) do not have to pay a single penny unless somebody clicks on the ad which means the customers pay as they play. Unlike many other competitors, Google is offering the highest number of services (range) and so it has penetrated deeper into the market.

There are few weaknesses as well, business over the internet always feel as virtual (due to lack of physical evidence) and so it is hard to identify if the customers are switching to the competitors, as there are no switching costs. Unlike Microsoft which is extremely popular and has a sound financial backup, Google is working independently and it may test its ability to recover if it faces a financial trouble. Google still has opportunities in the market as the world pattern is changing and number of people living a virtual life is increasing day by day. A huge segment to be triggered is the one that believes in more physical evidence and so Google can launch various software (CDs) to fulfil their needs. Google also has an authority to use strategies such as franchising or licensing which could help it getting even deeper into the market. As the number of online businesses is increasing day by day, there could be a need of advertising and what else could be more efficient than AdWords as there is no substitute to that in online marketing.

The internet is the only place where one can find infinite number of threats and Google is not immune to them as it is impossible to identify what the competitor is planning until it is implemented. Different kinds of viruses and scams are a threat to Google despite of having a secure network. There are even bigger players (that are financially even more stable) in the market constantly trying to gain the market share.


Google is open to everyone who has access to the internet. However, there are certain groups Google is more useful to. Google’s initial purpose was to serve the market that looks for accurate search results online, it may include students, researchers and surfers. Google further offers many of the similar services in the field such as Google images, back in late 90s people were keen to get the images for various reasons, as it was hard to locate the images, Google catered the market and made it easier to look for any particular image by simply giving a hint of what is being searched.

There is a massive segment over the internet that became the most lucrative for Google to make revenue from, the growing number of online businesses in the 90s helped Google to stand where it is. Google AdWords was solely built to serve the online business segment as without marketing it is impossible for any business to survive in the market. Google not only came up with an idea to help such businesses market themselves but also it provided an easy option which requires the customer (business) to start an ad campaign with few simple lines at an initial cost of only $5. To avoid any disappointment, Google offered online businesses pay per click option, according to which they just have to pay if a potential customer clicks their ad which itself is a surety.

As we all know that success for companies like MSN and Yahoo lies in their mail services offer, Google also came up with an innovative idea of Gmail which is used for email purposes. This further helped Google in increasing the members who joined as normal users but helped Google by either turning into a customer or by leaving the competitors and switching to all other Google services.

Competitive Analysis

The competitors for Google are AOL, MSN and Yahoo, these were already well set in the market when Google entered the equation. Yahoo was the global brand at the time Google entered the market, Yahoo was providing all the necessary services to the internet users which include both private users and businesses but there were few drawbacks such as limited number of searches. Yahoo is however ranked second after Google in terms of its market share and number of services offered.

Yahoo was followed by AOL which is a part of Time Warner Inc, the success of AOL lies in the kind of services it offers, this include email services, sports, dating services, instant messaging services and news. There were flaws as well, AOL is not having a dominant search engine and also it is quite limited to US and Canada as can be guessed by its name which is America Online.

MSN that is a subsidiary of Microsoft Corporation seems to be the toughest competitor of Google as it has not limited itself to the internet and online services but company is offering software, PCs, games (X Box) and most of the services including our very own msn messenger and hotmail. However, MSN remained a bit slow in reacting to Google’s philosophy of constant innovation and hence Google took the number one spot leaving the competitors to wonder how to cope with it. Apart from these giants, Google has faced some competition with the smaller search engines such as


Throughout its history Google has believed in constant innovation, a concept which requires a business to take many risks due to uncertain trends of the market but in Google’s case this strategy paid off. There were always small gaps in the market which Google tried to fill when competitors failed. Google’s success lies within its recruitment strategies as well as majority of the staff working at Google is more proficient technically, the living example of which is Google Earth.


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