Google and Big Data

Big Data Usage

Google and Big Data

Executive Summary………………………………………………………………………………………………………..3

Key Developments…………………………………………………………………………………………………………..4

Web Dominance and Data Collecting……………………………………………………………………………….6

Advertising and Data Collecting………………………………………………………………………………………6

Using Data for Opportunities…………………………………………………………………………………………..8

Using Data to Tackle Fragmentation………………………………………………………………………………..9

All Charts and Graphs…………………………………………………………………………………………………….10

Conclusion……………………………………………………………………………………...………………………………13

References………………………………………………………………………………………………………………………14

Executive Summary

“Google has become the most widely used web-based search engine since its launch in 1998” (Wikipedia). It’s founders Larry Page and Sergey Brin were both Stanford students in California, and while in school, developed their first search algorithm which they called “BackRub” in 1996. The search engine was soon shown to be very successful and after several expansions they took up Mountain View as their first official location for headquarters.

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 After the move to Mountain View, the company began to grow rapidly. It made its initial public offering in 2003, Released Google News in 2002, Gmail in 2004, Google Maps in 2005, Google Chrome in 2008, and their own social network known as Google+ in 2011. “In 2015, Google became the main subsidiary of the holding company, Alphabet Inc. (98.9% of Alphabet). Until now, Google has engaged in partnerships with NASA, AOL, Sun Microsystems, News Corporation and many other” (Wikipedia). Google is now worth $765 billion and continues to grow and expand.

Google exists in an environment that changes, evolves and expands unlike any other macroeconomic environment. Not only does it compete with other major search engines such as Yahoo and Bing, but it also competes with companies like Amazon, Microsoft, and Apple. Although most of these companies do not offer search engines, they offer the next biggest thing that most people in this country and other well-developed countries use: technology. The Google Home Hub competes with Amazon’s Echo Dot, their Lenovo tablets compete with the iPad, the Android with the iPhone, and their laptops with Mac. They even compete with Microsoft on some of their products and then go even further to offer Microsoft Office on their products.

Google’s biggest search engine competitor is Amazon because of their large database of products. When people look for something to buy, they look more often than not, on Amazon. The two companies compete on a number of levels, from phones to cloud services to search engines. The biggest point to note is that in this macroeconomic environment, the competitors are so dynamic that companies must also be one step ahead of the game, or exactly in line with it in order to stay valid and current.

Key Developments

Strength: Dominance in web search, video content sharing, online advertising, mobile OS, browser usage and many other markets. Google dominates most of the market it operates within, including online advertising (generating $95.375 billion or 87% of Google’s total revenue), web search (73.73% desktop market share), Android mobile operating system (used by Samsung, Huawei, Xiaomi, Lenovo, LG, etc. with 74.2% of worldwide market share, iOS only 20.8%). “Google’s leadership position in these markets help the company gain a competitive advantage by the massive amount of information obtained from its users and habits through using this platform, growing brand awareness and power over customers, competitors and suppliers due to its dominant market share” (Insight). Google has excellent acquisition capabilities, acquiring 118 companies in 3 years (2012-2015), an average of “1.6 acquisitions per month which is one of the highest in the business world” (Insight).

Weakness: A major weakness of Alphabet is their overdependence on revenue from advertising. “Google is very vulnerable to the changes in the digital advertising market due to increase in competition, query growth rates which are unlike ever before, and the evolution of the online advertising market” (Insight). Other factors that could severely hinder Google are changes in advertising offerings that arise due to new technological revolutions, advertising trends that they are not part of, and user preferences. “Another weakness is their excessive reliance on secrecy which has caused many experts to point out the company for being opaque, but in recent years, Google has tried to address this by providing another version of its algorithm” (Insight). Finally, Google merchandises lack compatibility with next generation devices which hampers the corporation and roots worry.

Opportunities: “A important opportunity to note for Google is the growing market for subscription-based video on demand services such as YouTube” (Insight). Youtube is now the most popular video on demand streaming platform in the world, with more than 1 billion users. This includes comparison to Hulu and Netflix, which are competitors to YouTube. According to a market research study, this market is expected to grow by 9.3% on average from 2017 to 2024. The Android OS has become a big competitor for Apple and Samsung which gives the company a potential opportunity. Diversification into non-ad business models such as Google Books and Google Maps pushes the company to remain profitable and is an indication that the company is adapting itself and pushing towards commercial transactions. “Google Glasses and Google Play are also evolutionary moments into the emerging world of nano-computing and beneficial to the company in the future” (Insight). Lastly, Cloud computing is a key opportunity since the company can provide a solution for cloud storage shortages which is and will be a major way to store data.

Threats: “Reliability and user experience of the Android OS may decrease significantly sue to increasing fragmentation” (Insight). Android had released several versions each one named after something sweet, such as Donut, Éclair, Jelly Bean, etc. For example, Gingerbread’s distribution is .03%, Jelly Bean 4.5%, KitKat 10.5% Lollipop 22.9%, and Oreo 4.6%. “The other threat would be from companies like Facebook, which seriously threaten Google in the internet world and make the company have to deal with the increasing features available on Social Media” (Insight).

Web Dominance and Data Collecting

Dominance in web search, video content sharing, online advertising, mobile OS, browser usage and many other markets isn’t done by chance. Google dominates most of the market it operates within because of efficient and accurate data collecting. By analyzing the habits and patterns of their user they gain a huge advantage with the massive amount of data they obtain. Using the data, they can target specific users using an algorithm to promote or advertise for a specific brand the user researched before. Google targets individuals based on their search history, most visited sites, most bought products, etc. This is why they dominate the market. They use their platform to grow brand awareness, which is the leading contributor to their profits, and use that power over customers and users. The amount of data collecting by Google is so large that it gives Google power and dominance over not only its users, but its suppliers, and competitors and will continue to dominate in this way in the foreseeable future. There are no companies in this market that have nearly as much dominance and ability to acquire data comparable, even in the slightest, to Google.

Advertising and Data Collecting

 Advertising is a major component of marketing to most large companies. The shift of retail from in stores to online has been shaking up the economy. Several department stores, such as J.C. Penny, Macy’s, etc., have been forced to shut down stores across the country because of this shift. Although this shift has been detrimental to many retail stores, to companies that exist online, such as Google, this shift is excellent for the company. As more and more department stores shift their focus to online retail, versus the traditional in store retail, they start to shift their marketing to being more dominant online. This means more money to be spent on companies like Google. Google’s job is not to create the advertisement that go online, but to target the promotions and advertisements to the right clients.

 The right clients are found only through data collecting and analyzing. Google runs data analysis on the habits of their customers to match companies to their perspective cliental. This match benefits all three entities. Google to make the match and collect advertising revenue, the seller who can target customers looking for what the seller sells, and the buyer who is advertised to based on what they search and like. Using algorithms to make these connections, Google has been attractive to many other search engines like Yahoo!, Bing and several others. Although Google does have competitors, advertising for these competitors are much less, simply put, because Google is the most popular and most reliable.

 Even though Advertising for Google has been a major revenue source, their overdependence on the advertising revenue is a major threat to the company. Just as the internet came very quickly and benefited the company, the company is just as vulnerable to the change that could occur due to increase in competition, query growth rates, and evolution of technology. Query growth rate are growth at a rate higher than recent years because competition has been becoming increasingly high with new companies and ideas entering the market. If new advertisement strategies come about that Google does not adopt, it could destroy the company. For example, Toy-R-Us, the toy retailer, claimed bankruptcy because of not adapting to the change. While most competitors, like Target and Walmart, were already transitioning online, Toy-R-Us kept their online presence weak and their in-store presence like they did in the past. Google must avoid this and stay up to date on all current trends and technological advances to maintain their strong presence. Since they have a large database of information at their hands, keeping up should be a matter of efficiently using their data and applying the necessary changes.

 Online companies have been attacked a lot recently due to the lack of secrecy of their customers. Companies like Facebook, who have had severe cases of consumer information leaking, face hardship that didn’t exist at such a large scale before. Collecting data online, not just history searches and shopping baskets, but addresses, phone numbers, credit cards, provides the companies with liability risk. With big data comes big responsibility. Accurately managing data and protecting it could also be detrimental to a company’s existence. Facebook suffered a major decrease in their stock value since the infiltration of hackers in their system. This proves to be a major threat to companies like Googles and managing their information and customers privacy should be a main point to protect on behalf of the company.

Using Data for Opportunities

An opportunity for Google to grow using data is creating merchandises that are compatible with next generation devices. Another opportunity is taking advantage of subscription-based video on demand services such as YouTube. Popular services as this would greatly benefit Google shift away from only advertisement revenue and into video subscription revenue. This area is said to grow significantly in the next 5 years and given the data at the hands of Google, they could begin something like this quickly and see that it does well. Using their data collection from the users they currently have they can create their own video website and have “Google Videos.” The previously spoken about “Google Glasses and Google Play” are also great opportunities for Google in which they can use they knowledge they already have to grow these two areas.

Using Data to Tackle Fragmentation

 Google’s fragmentation hinders the company’s ability to stay whole. Every new version of the Android has been named a new “sweet” name. This makes the company’s customers have a less reliable experience since the version all very and fragments the Android system as a whole. Collecting and combining all these versions of the system to make one excellent and unfragmented version would collect the company as a whole and increase user experience positively. This also makes the company less vulnerable to the other companies who increase features on social media. One Android system that is updated to be better occasionally will help the company tackle outside influences like this. So, using the data to collect and combine the versions would tackle the threat to the company and help them avoid future trouble with new social media outlets.

Charts and Graphs

Countries Most Eager for Google’s Data

Number of active Gmail users worldwide from January 2012 to February 2016 (in millions)

Distribution of Google’s revenues from 2001 to 2017, by source

15 Years of Google

Conclusion

 Google has been a leader in the online world for quite some time. They developed their algorithms and data collections systems to benefit them as much as possible. The data that Google carries and uses to benefit its company is data that has been sought out by many entities, government or not. It is very valuable and very dangerous information collected over the years, from every single one of its users, at any time. The data is stored, saved and protected so highly that only few people are allowed entry into Google’s Data Storage Centers. We can see the use and impact that data provides to companies. We can use that data to change the company to benefit a new trend, to create a new algorithm that analyzes more efficiently, or to create the new smart phone system. Data is one thing that is absolutely necessary for Google’s survival, but with the shift from reality to virtual reality on the horizon, data will be the lifeline to many companies.

References

• “Google.” Google, Wikipedia, en.wikipedia.org/wiki/Google.
• Jurevicius, Ovidijus. “Alphabet (Google) SWOT Analysis (5 Key Strengths in 2018).” Strategic Management Insight, 17 Sept. 2018, www.strategicmanagementinsight.com/swot-analyses/google-swot-analysis.html.
• Marr, Bernard. “Want To Use Big Data? Why Not Start Via Google, Facebook, Amazon, (Etc.).” Forbes, Forbes Magazine, 14 Aug. 2017, www.forbes.com/sites/bernardmarr/2017/08/14/want-to-use-big-data-why-not-start-via-google-facebook-amazon-etc/#415f18f3d5db.
• Richter, Felix. “Infographic: 15 Years of Google – How the Search Giant Dominates the Web.” Statista, 27 Sept. 2013, www.statista.com/chart/1502/15-years-of-google/.
• Singh, Gautum. SWOT Analysis of Google. educatererindia.com/wp-content/uploads/2017/05/SWOT-Analysis.pdf
• Urgiles, Kevin. “An AI Made a $16,000 Work of Art, and It’s Actually Pretty Cool.” Mashable, Mashable, 3 Dec. 2018, mashable.com/video/ai-art-aican/.