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Strategic Management

With a stellar growth in the number of users, Internet changes the way of advertising (Thompson, Strickland ? & Gamble 2010, p.C-259). Not a quote – see Referencing Guide The Search industry, which accounts for the largest portion of Internet advertisement, becomes one of its most eye-catching sectors. This essay, based on the case of the industry leader—-Google, analyses this issue from two angles, one from a retrospective point of view, the other is looking to the future.

2. The Determinative Components of Success in Search Industry 2.1 Advertising Style Advertising is the major source of revenues for search engines, and only by relying on the advertising money could the assorted products and services be provided at no charge to the users (GMJ 2010). Advertising contributes to over 95% of Google’s massive income nowadays (Mitchell 2011). The company’s soaring revenues depend on its effective price management of AdWords & AdSence and text-only ads. A percentage is a quote – use a page number. See Referencing Guide

2.1.1 AdWords & AdSense’s Unique Pricing Structure  On one hand, Google AdWords adopted an auction system by which bids could be made on cost-per-click (CPC) basis according to a Quality Score. This allowed advertisers to pay only one

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cent more than the next highest bid (Thompson, Strickland ? & Gamble 2010, p.C-270). Through this way, people would not worry about overbidding and the effect of winner’s curse was lessened (Coy 2006). On the other hand, Google’s AdSence shared advertising revenues with Web publishers and mobile phone operators (Thompson, Strickland ? & Gamble 2010, p.C-270). Not a quoteAs a result, Google generates nearly 30% more profit per ad impression than Yahoo does (Coy 2006).

2.1.2 Text-only ads?According to some observers, despite the past year’s ad slump, Google had a better performance than its rivals due to the text-based ads linked to search results ([email protected] 2011). ?  2.2 Methods to attract users Advertising is absolutely more valuable if a search engine can attract numerous users. Google’s attractions lie in the innovative technologies, the focus on the user experience, as well as its brand influence. ?

2.2.1 Technology innovation?Google could not only spot pages that other competitors could not find, but also generate a best-matching search results list (VentureBlog 2003). Comparatively, its rivals such as Yahoo fall back on Google searches when they fail to generate results which match the user’s keywords as well as Google’s ([email protected] 2011). 2.2.2 Focus on the User Experience? Aside from its effective searching, Google has obtained user’s trust by keeping the user experience clear of conflict of profits. Instead of displaying the sponsored sites as the first result, Google’s “sponsored links” are sorted based on the user’s search terms and labelled as advertising ([email protected] 2011).

2.2.3 Brand Influence? Presented by a European study, Google is the number one most recognized worldwide brand. It even is used as a verb meaning to search, which constitutes real challenges to a search firm seeking to protect the strength of its mark (VentureBlog 2003). 2.3 Other Factors Besides, Google’s success is also driven by the energy of the workforce. Empowering clever women, young people and others of all nationalities equally, the organization’s creativity is inspired in the highest level (Mitchell 2011). Moreover, as the first mover, Google benefited from the fact that it did the right thing successfully in web search before others (GMJ 2010). Ultimately, the acquisitions with companies such as YouTube and Android, the continuous invention of new functions, and the outstanding performance on Mobile Web Search offer Google additional advertising opportunities? (Thompson, Strickland ? & Gamble 2010). Do not use initials.

3. Prospects for the Future of Search Industry Search industry has a close relationship with people’s lives. The trends of social development and people’s lifestyles will inevitably have a significant impact on the industry. Thus, firms should identify forces which will bring about major changes and have a clear recognition about the future trends as well as threats. In the face of media explosion, search still isn’t accessible enough. It should be available in entertainment equipment such as game stations, televisions and high-end stereo systems. It also needs to be more mobile and be available not only in cell phones, but also in cars and on handheld, wearable devices (Mayer 2008). ?

3.1.2 Expansion on Mobile Phones With the significant development of smart phone technology, searching via a telephone has already become secondary to online applications. (Buresh 2010). Looking ahead, mobile search will grow faster than PC search. However, it should be noticed that the requirements of mobile searches are different in several aspects. For example, they are more task-oriented and less about discovery. Thus it will be more vital to have the accurate answer in the mobile space (Cheskin Added Value 2010). ?

3.1.3 Needs of People The development of technology is aimed to meet people’s needs and make life more convenient. According to this, the tendency of search industry should be more human-oriented. Say, cars could be online more than they are now in order to choose better routes through search engines (GMJ 2010). Another example is that people could position the optimal medical institution for disease more easily through the search engine.

Since most information seekers prefer plain and simple answers to straightforward questions, the open-domain QA, which allows users to go beyond keywords and get their question answers more quickly, has arisen as a technology that completes or even competes against keyword-based search engines (Q&A). Nevertheless, as the last answer-extraction stage always use Web-search results, the keyword-based search firms could take this advantage and develop their own QA website (Grimes 2006).

It’s no secret that search engines can record, store and share users’ private information easily (Munt 2010). Due to web browsers technical weaknesses, their computers could have unsafe software installed without acceptance by “risky sites” (Eddlman & Rosenbaum 2006). This behaviour could reduce users’ trust on search engines and should be prevented through making relevant policies as well as improving search firms ethical reorganization.

Conclusion

According to the performance and strategy of Google, we can conclude that the key factors which define success in the search industry are the right method of advertising, the ability to attract users and other factors might related to corporate culture. In the future, the development of media, the increases in mobile users, people’s demands as well as the threaten from Q&A technology and users’ worry on security and privacy are the major forces to bring changes of the industry.

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