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Google Prepares Markets for Digital Economy Case Study

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Updated: Jul 29th, 2021

Google operates in a very competitive and technological industry. This firm has managed to maintain the market lead in the face of a stiff competition from other strong market leaders.

Google has a market share of about 62 percent. Its closest rival is Yahoo, with about 26 percent of the market share. Other strong competitors of this firm include Microsoft, Ask, and AOL.

In order to have a comprehensive understanding of this firm, the analysis tools such as SWOT and Porters Five Forces would be used.

SWOT Analysis of the Firm

To give a clear analysis of this firm as far as its suitability is concerned; a SWOT analysis would be helpful.

The strength of this firm comes from various factors. Google has a very strong band in the market that is trusted by a huge base of customers. This has helped it maintain its customers. The search engine is the strongest and broadest in coverage, making it the most preferred search engine in this industry.

The move by this firm to involve students and corporate bodies in the activities of this firm has increased the knowledge base and creativity of the firm. With a large capital base, this firm is able to conduct research on development of the firm.

However, some weaknesses are threatening to derail this firm. The first weakness is the ability to satisfy all its customers in equal measure. Google would allow an individual to search anything in the internet.

The problem is that some of the sites contain information that is not appropriate for certain individual or age group. Some parents are weary of Google, as they believe that their children would access some information that may be for adults only.

This lack of a technology that would enable it restricts some individuals from accessing certain sites may taint its image among some customers.

The firm has some opportunities that further put it into the best position of maintaining its market lead. The fact that the emerging technologies are pushing more people to rely on computers and the internet is increasing the size of the market.

Furthermore, there has been a steady increase in the number of leaning institutions, which have introduced electronic learning, which means that they would be prospective customers of Google.

Despite the above positivity, there are threats that this firm has to overcome in order to manage the competition posed by other firms that are also strategizing to win the market share. The first threat is the competition in the market.

There are various other firms, which have put spirited fight in order to win the market share. Some of these firms, like the yahoo, have the structure that would help them compete properly in the market.

A further analysis of this firm, and specifically its ability to maintain its market lead, can be done through PESTEL Analysis.

PESTEL Analysis

Google can be given a detailed analysis through PESTEL analysis. This analysis would help give a detailed analysis of the external environment within which this firm operates. These attributes would be very important in making the decision on how to confront this environment in coming up with policies of how to manage the market.

The PESTEL analysis technique has been used in an effort to analyze some of these factors. The PESTEL model usually covers the political, economic, social, technological, legal, and environmental factors that are likely to influence the decision-making processes.

When developing strategic plans for the firm, some of these factors might result in various changes being made in the planning process (Charantimath 2006, p. 85).

Political Factors

Google’s main market is in the US. This country has the most stable governments in the world. The leadership of this country has encouraged development in various fronts, especially the infrastructure. The government has also been supportive towards creativity and innovation in the entire country.

The government has put much effort in making sure that the politically calm in order to sustain business in the local market. other major markets in Europe, south America and even Africa have enjoyed relatively calm political environment which have made them be able to work normally, and therefore be able to use this site.

Other than China that tempted to restrict operations of this firm in the country, other nations have not made any restrictions to this firm on their operations.

Economic Factors

The world economy has been witnessing instability in the recent past. The United States is one of the countries that were heavily affected by the recent world economic recession. This has put a lot of pressure on the country’s national budget, especially due to the subsequent inflation.

The inflation rates have been constantly rising across many nations. This has posed a challenge to the firm in its quest to increase its market share. Most of the customers would be locked out of the market, as they would consider accessing the internet a luxury.

They would prefer not access this site and use the resources in other activities, a fact that would be a blow to this firm. However, the recent economic recovery of economy in many is good news, as the market size would be expected to expand (Daft 2009, p. 67).

Social Factors

This society highly values entertainment as a form of leisure. The internet, especially the internet games and the social media form one of the most common leisure in the world today.

The popularity of social media has been growing at a very high rate across the globe especially among the young and middle-aged population.

Given that the world has very many young and middle age people, the firm is likely to become a great success, as more people would be using it to access various entertainments that would make them loyal customers of the firm (Evans 2010, p. 47).

The society also appreciates the rights of individuals and this makes expand its products without the fear of intimidation from some quarters of the society.

Technological Factors

The emerging technologies have redefined the way things are done in various facets. The United States, and the world at large, has generally embraced technological advancements in almost every sector.

This has been advantageous, as technology has made it easy for individuals to understand the importance of search engines like Google. In the hospitality industry for instance, hotel bookings have been made easier and less expensive as they can be done online.

Most of them have ultra-modern facilities high-speed internet connections and satellite dishes. All these have made service delivery effective, convenient, and even entertaining, as they also make Google and other search engines for that matter, very relevant in this market.

The increasing market for personal computers, especially the laptops, has increased the market share of the firm. Given the current trend in the increasing technologies in the global market, Google has the ability to increase its market share base.

Environmental Factors

Environmental factors may have both positive and negative effects on the firm. Various environmental conservation agents have criticized the computer age very heavily. They argue that computers have adverse effect on the environment, especially when it comes to the disposal of the old computers.

They have made efforts to ensure that production of the computers is closely regulated. However, the recent move by some companies and organization of collecting the electronic wastes and safely disposing them may be a ray of light, as this would eliminate the feeling that computers are harmful to the environment.

Legal Factors

Law and order is one of the most important aspects on the social welfare of a given society. Giddens (2009, p. 42) explains that the community that lacks clearly stated laws and regulations cannot make it through successfully on various fronts.

On the legal front, laws have been enacted to enhance environmental conservation and minimize pollution activities. There is also a clear law that helps in the regulation of market competition and how competitors should relate in the market.

The law protects firms in this industry from any form of external aggression or uneconomic competition that may jeopardize the position of one or more firms (Kabani 2009, p. 32).

The law is also very tough on those who breach the right of others either socially, economically or in whichever front.


Google operates in a highly competitive market. Kurtz (2008, p. 83) argues that this firm must take care of several technological factors in order to remain competitive in the market.

Being the market leader, this firm is faced with a number of challenges that it must address in order to retain its lead in the market. The biggest threats for this firm are emerging technologies and the competitors.

To the emerging technologies, this firm must be very keen to monitor how new technologies may have effect on its normal operations. It is a good move that the firm has made in creating a contest that brings together students, clients, and investors.

This would help the firm in being innovative in the market (Page 2010, p. 39). The employees of this firm should be encouraged to monitor keenly the changing technology in the environment, especially the social media. They should know the technologies to implement and those to avoid.

This is because not all emerging technologies are beneficial to the firm. In general, the employees should ensure that the firm remains enthusiastic about emerging technologies.

Google must also take into consideration the fact that it takes a lot of effort to remain the market leader in the industry.

Google should study the activities of other industry players and determine the possible consequences that it may undergo if these players change their approach in the market. It should also assess the effect that the social media has on its profitability.

If the research proves that the effect is negative, the management of Google should immediately consider the social media as a competitor. Consequently, measures should be taken to ensure that such competitors are put under check.

List of References

Charantimath, 2006, Total Quality Management, Pearson Education, New Delhi.

Daft, R 2009, Organization Theory and Design, Cengage Learning, New York.

Evans, D 2010, Social Media Marketing An Hour a Day, Wiley Publishing, Inc. Indianapolis.

Giddens, A 2009, The consequences of modernity, Blackwell Publishers, Malden.

Kabani, S 2009, the Zen of social media: An Easier Way to Build Credibility, Generate Buzz, and Increase Revenue, BenBella Books, Inc. Dallas.

Kurtz, D 2008, Contemporary Marketing: Designing Customer Oriented marketing Strategy, Cengage Learning.

Page, S 2010, The Power of Business Process Improvement: 10 Simple Steps to Increase Effectiveness, Efficiency and Adaptability, AMACOM, New York.

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