SWOT Analysis of Google
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Introduction
Google
is probably the world’s best-known company for pioneering the search engine
revolution and providing a means for the internet users of the world to
search and find information at the click of a mouse. Further, Google is also
known for its work in organizing information in a concise and precise manner
that has been a game changer for the internet economy and by extension, the
global economy because corporations, individuals, and consumers can search
and access information about anything anywhere and anytime. Moreover, Google
also goes with the motto of “Do not be Evil” which means that its business
practices are geared towards enhancing information and actualizing best
practices that would help people find and search information. Though its
business practices in China and elsewhere where the company was accused of
being complicit with the authoritarian regimes in censoring information were
questionable, on balance, the company has done more good than harm in
bringing together information and organizing it.
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Strengths
- Market Leader in Search Engines
Perhaps
the biggest strength of Google is that it is the undisputed leader in search
engines, which means that it has a domineering and lion’s share of the internet
searches worldwide. Google has more than 65% of the market share for internet
searches and the competitors do not even come close to anywhere that Google does.
- Ability to Generate User Traffic
Google
is a household brand in the world, its ability to drive internet user traffic
is legendary, and this has helped it become one of the most powerful brands in
the world. Indeed, Google averages more than 1.2 Billion hits a month in terms
of the unique searches that users perform on the site. This gives it an
unrivaled and unparalleled edge over its competitors in the market.
- Revenue from Advertising and Display
Its
revenue model wherein it garners humungous profits through partnerships with
third party sites has held the company in good stead as far as its ability to
mop up resources and increase both its top-line as well as bottom-line is
concerned. This is another key strength of the company that has helped it scale
greater heights.
- Introduction of Android and Mobile Technologies
The
last of the strengths discussed here relates to its adoption of Android and
Mobile technologies, this has resulted in it becoming a direct competitor of
Apple as far as these devices, and operating systems are concerned.
Weaknesses
- Excessive Reliance on Secrecy
Google
does not reveal its algorithm for searches or even its basic formula as far as
internet searches are concerned leading to many experts slamming the company
for being opaque and hiding behind the veneer of secrecy. However, in recent
years, Google has taken steps to redress this by providing a bare bones version
of its unique search engine algorithm.
- Falling Ad Rates
In
recent years and especially in 2013, the company has been faced with declining
revenues from ads and as a result, the profitability of the company has taken a
hit. This is partly due to the ongoing global economic slowdown and partly
because of competitors snapping at its heels in a more aggressive manner. Indeed,
Apple has already taken steps to garner search engine revenues in its devices
and hence, Google must be cognizant of the challenges that lie ahead.
- Overdependence on Advertising
Google’s
business model relies heavily on advertising and the numbers reveal that it
gets more than 85% of its revenues from ads alone. This means that any
potential dip in revenues would cost the company dearly (literally as well as
metaphorically). The point here is that Google has to devise a more robust
business model that embraces e-commerce and mobile commerce along with its
current business model that is based on ad revenues alone.
- Lack of Compatibility with next generation devices
Another
weakness for Google is that it is not compatible with many next generation
computing platforms including mobile and tablet computers and this remains an
area of concern for the company.
Opportunities
- Android Operating System
Perhaps
the biggest opportunity for Google lies in its pioneering effort in providing
the Android OS (Operating System) which has resulted in its becoming a direct
competitor to Apple and Samsung.
- Diversification into non-Ad Business Models
As
discussed earlier, the company has to diversify into non-ad revenues if it has
to remain profitable and current indications are that it is adapting itself to
this as can be seen from the push towards commercial transactions using its
numerous sites like Google Books, Google Maps etc.
- Google Glasses and Google Play
The
introduction of Google Glasses and Google Play promises to be a game changer
for Google and this is a significant opportunity that the company can exploit.
Indeed, this very aspect can make the company take the next evolutionary leap
into the emerging world of nano-computing.
- Cloud Computing
Cloud
Computing remains a key opportunity for Google as it is already experienced in
providing storage and cloud solutions. Indeed, if not anything, it can move
into the enterprise market using the cloud-computing paradigm.
Threats
- Competition from Facebook
The
advent of Social Media has seriously threatened Google’s dominance in the
internet world and the company has to pull an ace to deal with the increasing
features available on Facebook and Twitter.
- Mobile Computing
Another
threat to Google is from the emerging area of mobile computing that threatens
to pass the company by as newer companies seize the opportunity to ramp up
their mobile computing presence.
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