Analyzing Google's Business Model And Success Strategy In An Essay. (70 Characters)

Google's Business Model

Question:

Discuss about the Case Study on Google Business Model.

This report focuses on the business model of an organization and analyzes the success factor of that organization in the market. The report describes nine building blocks of the business model that are helpful for the company to achieve growth and success in the operating market. For the discussion, Google Inc is selected. The company is the market leader in the technology focusing basically on advertising and promotions. The company was founded in 1995 by Larry Page who created this search engine so that users can find any document and website based on appropriate keywords (Mcleod, 2005). Google basically provides free services to its users. Along with the service of search engine, users can also search for the books on Google Book Search, news on Google News, maps on Google Maps and Videos on Google video i.e. YouTube. Basically, Google changed the way of internet users to look and share the information. Being most popular search engine in the world, couples of other services are responding to the consumer’s needs (Faille, 2018).

In order to analyze the success strategy, it is important to understand the business model of the company. The business model includes nine building blocks structure that are helpful in achieving the business goals and objectives (Toor & Dhir, 2011). The business model of Google is basically a presentation of business operations and services of the company. The business model provides the understanding of various business operations of the company i.e. services, and activities in order to generate more profit. The business model basically includes the integration of strategy of the company, finance as well as organization (Dudin, 2015). The business model canvas of Google is discussed below:

The important part of the business model of key partners of the company that are helpful in operating the business in the competitive market. Key partners of Google are distribution partners, Chrome and OS devices, open Handset alliances and original equipment manufacturers (Osterwalder & Pigneur, 2010).

Key activities of the company include research and development in order to develop new technologies and features and enhancement of existing technologies. Along with this, the company spends significant time in the management and maintenance of IT infrastructure, products and services. Company is also engaged with the strategy, licenses and alliances.

Key resources for Google include servers and IT infrastructure, data centers IPs and human resources. Along with this, there are other resources also i.e. licenses, patents and proprietary materials that are helpful in the success and growth of the company (Mason, 2015).

The objective of the company is to provide value to the customers for advertising, internet search, platform and enterprises and operating systems. Along with this, the business principles of the company can be understood by the mission statement that is to manage the information of World and make it useful and accessible for the users in all over the world (Lake, 2015).

Building Blocks of Google's Business Model

There are various ways by which the company maintains strong relationships with the customers. The aim of the company is to maintain healthy customer relationships by different ways that are discussed below:

Personal assistance- To the customers at the distribution centers by phone support, e-mail and contact by website so that the queries of the customers can be handled effectively,

Automated services- Sending invoice to the customers’ email address after the confirmation of product orders, email for the collection of the products and email for collecting feedback in terms of product purchased, service provided, and marketing etc (Sinfield, Calder, McConnell & Colson, 2011).

Sales and support services and dedicated team in the company are focused on building and enhancing strong relationships with the customers.

Channels are very helpful for the customers to reach to the services of the company. Channels used by Google are Google affiliate website, Google Adwords and google.com. There are sales and support teams in order to reach network members and advertisers. So, channels used by the company are business partners, key dealers and distributors, mobile carrier and stores (Armstrong & Cunningham, 2012).

In Google, customers are segmented into three catagories. First is Users segments who use the information in the proper and convenient manner by using Google products and services. Second are advertisers who have the cost-efficient way to show online and offline ads to the customers. Third and last are content providers or Google network members who use the services. Another segment may also include mobile device makers and users with developers (Fifield, 2012).

In Google, the primary costs are incurred in people, research and development, IT infrastructure, marketing and selling costs and general and administrative costs and financial cost. These costs are generally evaluated in the financial reports of the company.

The primary revenue of the company is generated from its ad-powered search engines. The revenue streams of the company are generated by enterprise product sales, and Google websites.

Based on the business model canvas, it is observed there are some critical factors that are helpful in the success of Google. One of the important elements of Google business model is the company is using multi-sided platform business model pattern. There are some key factors in the business model of the company that differentiate it from the other companies and helpful in achieving success and growth (Filet, 2013).

Value proposition- The business model of Google includes three value propositions. Although Google has various value proposition for the consumers but they follow single philosophy i.e. providing targeted advertising globally. The company is committed to provide the best available technology to the customers. The company basically creates user friendly platform by which people can directly connect with the information. By this, company enhances the overall user experience. This attracts wide range of the consumers who are interested in using free services of Google. The company directs the users to the new websites on those pages where they want to get the information. Along with this, the company is improving its search engine everyday in terms of accuracy, supplementary functions and customized results. This enhances the competiveness of the company in all over the world. On any important dates and events like date of birth of some famous artists, creative and innovation of Google can be seen in the layouts and words. Along with this, creativity sense of Google can also be seen in its language settings (Tater, 2016).

Critical Success Factors of Google's Business Model

Revenue- Google has become the tool of marketing itself for other company. The success factor of the company is its revenue system. The company has strong balance sheet with no any debt and nearly $50 billion in cash (Dawn, 2013). The company has high level of internal competency along with technology and company is attracting top talent from the competitors for years. Along with this, the brand name of the company is also strong among the customers. In terms of capital, there are unlimited opportunities for the company. Now, Google has established itself as the leading market share in terms of mobile systems with android and company has found a way to develop new social networking projects (Wolfe, 2017).

Human resource- This factor is one of the greatest asset of Google Inc. With the top talent from all over the world, Google is able to bring various innovations and new technologies in its products. Along with this, company is able to maintain competitive position in the market in terms of technology, design and creativity. There are some reasons by which Google is able to attract the high quality human resource successfully. One of them is that company has effective working environment as it is famous for its fun and serious working environment and high paid. Along with this, there is comfortable working environment where employees are able to enhance their working quality and efficiency. This motivates innovation and diversity in the company. These factors contribute to the fact that Google is achieving success due to best talent. Designers and maintainers of the company are creative and high sense of creativity.

Conclusion

Based on the overall discussion, it is observed that Google is able to achieve growth and success due to its business model. Along with this, Google has various factors that are helpful in achieving success in the market. In the business model, there are nine building blocks that represent the services of the company provided to the student. Company provides value propositions to the customers. This attracts wide range of the consumers who are interested in using free services of Google.

References

Armstrong, G., & Cunningham, M. H. (2012). Principles of marketing. Australia: Pearson publication

Dawn, (2013). Google 2012 revenue hits $50 billion, profits up. Retrieved from https://www.dawn.com/news/780915

Dudin, M. N. (2015). The Innovative Business Model Canvas in the System of Effective Budgeting:  Asian Social Science. 11 (7). 290-296

Faille, C., (2018). Google's Key Success Factors. Retrieved from https://smallbusiness.chron.com/googles-key-success-factors-27311.html

Fifield, P. (2012). Marketing strategy. (2^nd). Berlin: Reed educational & publishing Pvt Ltd

Filet, E. (2013). Conceptualising Business Models: Definitions, Frameworks and Classifications: Journal of Business Models. 1 (1). 85-105.

Lake, C., (2015). Google’s five key success factors for effective teams. Retrieved from https://searchenginewatch.com/sew/study/2435671/google-s-five-key-success-factors-for-effective-teams

Mason, H. (2015). Trend-Driven Innovation: Beat Accelerating Customer Expectations. John Wiley & Sons

Mcleod, W. M. (2005). The Birth of Google. Retrieved from https://www.wired.com/2005/08/battelle/

Osterwalder, A. & Pigneur, Y. (2010). Business Model Generation. New Jersey: John Wiley & Sons

Sinfield, J. V., Calder, E., McConnell, B. & Colson, S. (2011). Corporate Strategy: How to identity new business models. MITSloan Management Review.

Tater, M., (2016). The Secret Behind Google’s Success: Case study on Google Business Model Based on Business Model Canvas. Retrieved from https://www.entrepreneurshiplife.com/secret-behind-googles-success/

Toor, T. P. & Dhir, T. (2011). Benefits of integrated business planning, forecasting, and process management: Business Strategy Series. 275-288

Wolfe, L., (2017). How Google's Business Model Works. Retrieved from https://www.thebalance.com/how-google-s-business-model-works-3515189