Sunday, March 6, 2011

Google

What were the key factors behind Google’s early success?
- If you have only one word to describe Google, what's that word? Google it!
At the beginning, it specialized in just one thing and did it very well: algorithmic search. Google.com offered more relevant and reliable search results with its index of one billion web pages, was revolutionary in its extremely simple interface, did not lure users to stay as long as possible on its website, and initially carried no ads. As it succeeded in this search service and built the customer trust and brand name, it began expanding other services: emails, maps, calendar and so on.
- Another day? Then another Google
Google constantly changes: It has learned from others, continuously improved, and frequently delivered innovative services and products. This has been a key factor not only for its early success but also for its sustainable growth. Examples are abundant: it learned from Overture but used CTR instead of CPC; it learned from DoubleClick and expanded AdSense; it learned from several email providers (e.g., Microsoft, Yahoo!, and AOL) and came up with Gmail. It can achieve the constant changes thanks to its obsession with innovation through adopting unconventional approaches for managing innovation.
- IPO? Yes and No
Yes, it did go ahead with IPO, but No, it was not the conventional IPO prospectus. The dual-class equity allows Google's management trio to have more power to be innovative and take risks without external pressure about replacement by investors. Ultimately, this dual-class equity protects the corporate values: 1. don't be evil; 2. technology matters; and 3. we make our own rules.