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Google strategic management : Internationalization and diversification

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  1. Google's environment
    1. Characteristics
    2. Opportunities and Threats of the environment
    3. E-Service sector attraction
  2. Strategic analysis
    1. Strategy of penetration on the market
    2. Internal strategy of growth
    3. Strategy of diversification
    4. Strategy of internationalization
    5. Strategy of differentiation
    6. External strategy of growth
    7. Strengths and weaknesses of Google

Founded in 1998 by Larry Page and Sergey Brin, "Googol" meaning "follow-up of 100 zeros" is a mathematical term. This number makes it possible to symbolize the incredible number of Web pages listed on Google. Google is one of five most popular Internet sites in the world. In the USA it is the fourth most visited site, after Yahoo, AOL, and Microsoft-MSN and before e-Bay. In France its notoriety is even larger, because it is third behind Microsoft and Orange and in front of Free. The principle of operation of Google, which made its success, turns around an innovation of its creators: the Rank Page. When a document is pointed by many hyperlinks, its Rank Page increases and the higher it is, the more it will have the chance of being posted in the first results of a research. This system thus gives an indication of the popularity of the document among the other documents of the Web. This revolutionary invention immediately was patented by its inventors during the creation of the startup, and was such a success that it was quickly conceded under license with several gates.

[...] STMK Google 19 Advantages Quick operation Fast acquisition of additional market shares Quick access to technologies Synergy effect Diversification Limits Cultural differences between grouped companies Non complementary risk Financing issues Social costs in case of restructuring with redundancy In the press reviews, it is known that Google wishes to take the control of innovating Start-up or to be combined with the principal competitors Strengths and weaknesses of Google We will expose here the strengths and the weaknesses of the company, which is a good summary of the overall company profile. [...]

[...] A library of more than 4 billion Web pages, a Google does not offer yet an offer of services directory counting more than 1,5 million sites classified by categories, a bank of data comprising 450 million numerical photographs and bands which enables Google to occupy a position of leader with 55% of the shares of market. Thanks to the considerable number of visits of Net surfers on his site with the daily newspaper, Google represents a very powerful vector of communication and very rapid one for many advertisers. [...]

[...] STMK Google 12 Barriers to entry : Economies of scale Expensive ticket of entry (capital + experience effect + Page Rank patent purchase) Important transfer costs (advertising budgets) Little services differentiation Rivalry Determiners: High growth rate of the sector Little differentiation and innovation New Comers Weak threat of new comers Sector competitors Suppliers Strong negotiation power Strong negotiation power Customers Rivalry Intensity Customers Power Determiners: High number of users Company turnover depends from website traffic (advertising) Suppliers Power Determiners: Dependency to navigators Near monopoly of Internet Explorer Threat relative to clientele Substitute Products Substitute Product Threat; Library Shops Encyclopedia or dictionaries Diagram of Porter's 5 competitive forces Competitors strategies and positioning STMK Google 13 Diversified Access Providers Google Yahoo AOL Orange Free Premium Services Media Services NRJ BBC Time Lycos Voila Wonderers Mappy Altavista Yellow Pages Specialised Innovative The bearable competing advantage must be exploited, rare, non imitable, non transferable. [...]

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