04-12-2012, 11:41 AM
Google 4 P's Marketing
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Introduction
Google was founded by two Stanford University students, at their dorm room, in 1995. Google has become the worlds most popular search engine since then and can attribute its success to an innovative marketing plan. The culture of Google is similar to many of the dotcoms of the 90’s. Most employee workstations are surrounded by leisure activities such as rollerblading, coffee lounges and an array of toys, such as scooters and rubber balls, strewn throughout the building. The culture was built to suit the habits of a generation of computer nerds who were tired of sitting in cubicles. Unfortunately this culture was part of the reason many dotcom’s went down in the Tech Stock crash in the late 90’s. Google is unique in where the employees really had helped develop a tool that was needed by everyone who had an internet connection. It found a good market niche and followed the path of innovation to market itself as the strong company that everyone knows today.
The reason that Google is such an innovative company is that there are more uses to Google.com than meets the eye. Unobtrusive text ads on the right hand border help to boost sites that are willing to pay for clicks to their websites. Google search can be used as a conversion calculator, among other things, to help a user find how many feet are in a kilometer (type: feet to 1 kilometer). Google has a department called Google Labs that is testing new, free, internet technology such as a searching product catalogs and a personal web search.
Google’s marketing plan can be broken down into the four P’s of marketing; product, price, promotion and place. Google has taken into consideration each one of these areas of marketing and used them as an advantage over their competitors. With Google announcing it’s IPO it will need to keep up even more with competitors, now that there are stockholders analyzing every penny of the company.
Product
Product is one of the components of the 4P’s of marketing. A company or an individual must have product to market and to offer to the people. A product is define as anything that can be offered to a market for attention, use, or consumption, and that might satisfy a want or need (Armstrong and Kotler 278). Also, according to Armstrong and Kotler, a company’s offer to the market place often includes both tangible goods and services.
Google offers services as a form of it product to its customers. The products they offer fall into industrial products; Google’s’ business products offer services to their customers such as advertising and providing their search technology to solve companies’ search problems within their intranet. Also, they also sell tangible items along with its service or hybrid offers and also sell “pure” products.
Google categorizes their products into three classes: Advertising solutions, Business Solutions, and the Google Store. In their Advertising solutions, they offer Google’s AdWords. Google offers text-based ads that are precise to the search on the site of the user and the customers pay Google every time internet search users click on their site. They help the customers to set up their site as the volume of visitors to the customer site’s increases.
Price
Price is another component of the four Ps of the market mix. Price is defined as “The amount of money charged for a product or service or the sum of the values that consumers exchange for the benefits of having or using the product or service” (Armstrong, Gary and Philip Kotler 353). It is extremely important for marketers to remember that individuals in a market are highly receptive not only to the price of an item, but also to the value offered by the product.
Successful companies such as Google take special consideration at the different parts involved in setting its prices. Item such as list price, discounts, allowances, payment periods and credit terms are items that work together to set the price of its merchandise.
List price is one of the fundamentals components of setting a price. List price is defined as, “Price normally quoted to potential buyers” (Boone, Louis E. and David L. Kurtz 718). It is the basic price offered to prospective consumers, yet in many instances the price listed could increase or decrease as costumers select options. Google’s price for AdWords is set on the amount of advertisement per day it provides its consumers. In Google’s case the list price is at five cents per day, however it can go as high as $50.00 per day. The price difference will depend on the amount of advertisement per day that the consumers are willing to pay and the amount of times individuals click to see the ads and how high these ads rank on a search page.
Promotion
Promotions are activities such as advertising, personal selling, and sales promotion which communicate the merits of the product and persuade target customers to buy it (Armstrong and Kotler 63). Time and time again Google has refused to jumble its homepage with annoying advertisements, banners, or links to other websites, as reported by Ben Elgin in a recent issue of BusinessWeek (88). Other companies have flourished mainly due to their colossal advertising campaigns. For years, Google has committed itself to focus on search and avoids fancy graphics. Co-founders Larry Page and Sergey Brin dislike the idea of ads affecting search results. Consequently, Google does not do a whole lot to get their name out to the public. Surprisingly, the company has grown by word of mouth, not by advertising. Google relies greatly on word of mouth to develop and expand their innovative brand. The more credible a brand is, the more widely its reputation will spread. Google, like Kleenex and Xerox, has become so pervasive that the brand name is used as an ordinary word. Google’s convenient service and precise search results have made it one of the world’s best-known brands and search engines almost completely through word of mouth from satisfied users.
Despite emerging onto the scene later than others, Google has risen to outdo all of its competitors becoming what is now the most popular Internet search engine. Several people like the fact that Google offers a minimal homepage, which loads immediately without annoying advertisements. Lycos and AltaVista advertise heavily and load their homepage with flash. People seem to like Google more because of its simple and direct approach. As a result of Google’s outstanding results it has compelled its dedicated users to inform everyone else about their remarkable search engine. Google’s growth is proof of the power of viral marketing, without the need for massive advertising budgets.
Place
An important decision when trying to determine the overall competitive marketing strategy is place. Place includes company activities that make the product available to target consumers. Google’s place is the internet. When it comes to Google and trying to target their consumers, the people on the Internet, no one does it better.
In the past three years, Google has gone from processing 100 million searches per day to over 200 million searches per day and only one-third comes from inside the U.S., the rest are in 88 other languages. "The rate of the adoption of the Internet in all its forms is increasing, not decreasing," says Eric Schmidt, Google's C.E.O. "The fact that many [Internet companies] are in a terrible state does not correlate with users not using their products."
VeriSign, which operates much of the Internet's infrastructure, was processing 600 million domain requests per day in early 2000. It's now processing nine billion per day. A domain request is anytime anyone types in .com or .net. Within the next few years users will be able to be both mobile and totally connected, thanks to the pending explosion of Wi-Fi, or wireless fidelity. Using radio technology, Wi-Fi will provide high-speed connection from your laptop computer or P.D.A. to the Internet from anywhere; McDonald's, the beach or your library.
Google introduced the language limit in April 2000 with eleven languages, which was expanded as of Aug. 2000 to 24. As of July 2001, Russian was added. In Nov. 2001, Arabic and Turkish and then in early 2002 Catalan, Croatian, Indonesian, Serbian, Slovak, and Slovenian joined the group for the following 34 language limit options. These are available on the Advanced Search page and their Language Tools page.
Recommendations
Our first recommendation to Google is to continue doing what they are doing so well and that is indexing and rating billions of web pages every day better than other search engine companies. They must keep updating their search engine so it finds relevant and helpful websites or they will just be one of the others. The thing that Google does so much better than the other search engines is they bring up the closest matching websites and are not biasing the search with any paid advertisements. They must continue to separate the paid search results with the organic search results.
Our number one recommendation to Google is to maximize the marketing potential of going public. All of the press and attention Google is going to get in the next couple of months before their stocks are sold to the public will play an important role on how well they do in the early months of being a publicly traded company. It is not uncommon for companies to have a huge boost in sales and revenue right after they release their stocks. If Google finds some way to harness this opportunity, they should do very well. They will have at least a month or two until the stock is actually sold, since they just announced the release a few days ago.
Conclusion
If Google is resilient as it has been in the past it should be able to overcome even the most volatile market; tech stocks. Google must have an ongoing plan for marketing now that they have filed to become a public corporation. All eyes will be on their every move now and they may have to modify their marketing plan in order to satisfy their new customers, the shareholders.