The Criteria For Evaluating Strategic Alternative Marketing Essay

The Criteria For Evaluating Strategic Alternative Marketing EssayThis strategic plan is prep bed by IM last word Man termment Consulting Firm and pull up stakes start off examining Googles external surroundingsal influences. Next, in-depth assessment on the industrys competitive five forces which coin Googles profitability exit be done. Lastly, Googles internal strength and weaknesses willing be analyzed to generate its competitive implication. From these analyses, we discovered that Google will face legal and performance issues due to its offensive dodging in the long run. We have developed three strategic alternatives (Strategic Alliances, Defensive Strategies and Broadening Diversification Base) which Google faeces adopt to put forward its competitive position. The plan will be concluded with a recommended strategic alternative and its pitfalls.EXTERNAL ANALYSISPEST analytic thinkingAfter conducting PEST and Porter Analysis for Google, we have derived at the followingP olitical The expansion of Google was obstructed by the politics such as US and Chinese delegacy. They viewed Google as a monopoly and request authority to oversee its activities (Google, 2009). However, this barrier does non affect Googles operations as Google responded immediately to the customers by addressing its policies in regard to political/legal aspects. Example Google china announced that it is yetton up providing filtered search results on its website to fulfill the censor search results policy (China Daily, 2010).Economic Google focuses on highly targeted, measur able advertising, thus making it more successful than opposite competitors. The crucial need to stay up to date and continuously connected keeps its core services vibrant despite the parched surroundings due to sparing recession (Google, 2010).Social-Cultural Individuals are getting more educated and competent. Therefore lifestyle and demand of souls are changing rapidly. Google has to take note of s uch changes in secernate to compete with its competitors by providing addition services such as email. Individual are excessively increasingly becoming more connected due to the change magnitude means of communication available through the internet such as MSN, face book and unstable phone with internet capability. Google has responded by construction their mobile devices and released its own Android Mobile Phone Platform and Operating System. By tapping on these, Google shall have great advantage with increased number of search queries and relegate competitive standing.Technological The widespread diffusion of breeding and communication technology allows board geographical dispersion and integration of business activists. Innovative web applications treated trends in search, internet direct advertising and portable applications thus causing a more rapid and disruptive change in technology. Google has to take expand measures to stay ahead by keeping pace with technology adv ancement and maintains low cost (Refer to read A for Overview of PEST analysis).Porter 5 Forces AnalysisBuyers The bargaining power is high. The lifestyle of exploiters on using the search tool is becoming more sophisticated and demanding. Substitutes are easily available at press down cost or even free. Example Google online image computer memory priced at $5 per year for 20GB, but face book provided it for free. Google are required to reward both client groups equally. Example organizations customers would prefer their advertisement broadcasting in big banner on the webpage however, individual customers will feel very perturbing as they just want the search results.Substitute The bargaining power is high as buyers switching cost is low. There are plenty of replacements such as advertisement on television, radio, magazine, poster and search hotline.providers The bargaining power is low. Google is regionally not globally dominant and hardware purchases are one-time off. Google search is heavily depending on its competitors Microsoft and Apple software. If there are any new software releases from them, Google search may not perform well if no timely modify is done.Potential entrants The bargaining power is low. Yahoo and Microsoft have improved their search engines and can on pass their search tool through their point of intersections. There is no specific requirement for search engine, thus a better search engine invented by an opposite will critically affect Google. Also, the monitoring of authority from its political environment could affect Googles current technology and philosophy. antagonists The bargaining power is high. There is no patent on search engine so the environment can be easily exploited or manipulated. The switching cost is low. Example Microsoft and Apple have embedded their search tool into their Explorer browser. Also, disturb search tools have their own queer strength (Such as Yahoo attracts audience by its nice appearance). (R efer to Exhibit B for Overview of Porter 5 forces analysis) indwelling ANALYSIS (VIRO Analysis)We have observed that Googles net revenue keeps growing from 2001- 2008. Since the 2004 IPO, the stock price has soars from less than $100 to above $700. The number of Internet users keeps increasing rough the world, especially Asia. As the number one Internet search giant, Google attract majority of the new Internet users to be its customers. Google understands customer demand and monitor how individual lifestyle is changing rapidly each day. This understanding allows Googles business strategy to outshine among its competitors. Overall, we think that Googles business strategy works excellent at record but better strategic alternatives need to be in place.After conducting Google internal analysis, we have concluded the followingValue Google owns the Page-Rank technology, which allows them to provide the most stainless search results. The dominant food trade share and huge loyalty from customers gives Google competitive advantages.Rarity The services provided by Google are not rare. Many other companies besides offer alternative services such as search, email, blog, video sharing, online office application and cloud computing.Imitability All Googles services can be imitated. For example the Microsoft Bing reckon engine has incorporated several(prenominal) elements of the Google search The Simple UI, sponsor link, and page ranking.Organization Google has strong financial power, enquiry and development capabilities. The society is ready to actors line new products to stay competitive, or acquire potentiality competitors to eliminate threats.PROBLEM STATEMENTWe have observed that the main problem with Google is that the offensive strategies to improve its market shares/performance will lead to severe problems in the future. Google faces increasingly intensive competition from experienced incumbents like Microsoft, Social ne tworks and Baidu which had been gaini ng popularity within the Asia region. They will always be active in making fresh moves to increase or solidify their market position. With Google trying to dominate the cloud computing and search engine markets, this long-run strategy is backfiring with incumbents developing similar, if not, improved strategies to retain their market standing.In the long run, Googles plan to become the dominant provider of cloud computing might alike lead legal suits and privacy concerns. With increasing use of virtual server hosting, more enterprise networks, servers and data storages run virtually. Even when good security resistance modes were employed, important data will still be vulnerable and can be monitored for unauthorized uses. This will lead to data security issues like information used for unintended direct and data disruption/loss in the event of natural disasters.CRITERIA FOR EVALUATING STRATEGIC ALTERNATIVEStrategic alternatives must be able to create growth opportunities with hi gh lead of investment. Hambrick Fredrickson (2001) have mentioned that strategies are an integrated overarching concept of how business will achieve its objectives. Therefore we recommend that Google evaluate its strategic alternatives by looking at its vehicles (how Google wants to gets there, including alliances) staging (Google speed and sequence of actions) and economic logic (how profits and returns will be generated).STRATEGIC ALTERNATIVES AND EVALUATIONStrategic Alliances with other enterprisesIt is futile for Google to fight head with head against equally skilled competitors as its offensive strategic approaches will causes disruption its dominance in innovation in the long run. Hence, we recommend that Google alter their strategy and join forces with its competitors to add-value to its resources and capabilities (Refer to Exhibit C). With strategic alliance, Google can engage in a mutual formal relationship with two or more organizations and join forces strategically to a chieve collaborative valuable strategic outcomes. It allows joint contribution of resources, capabilities, shared risk, shared control and mutual dependence. draw a bead on of strategic alliance is for Google to achieve synergy where benefits from the alliance will be greater than those from individual efforts.Google will be able to improve market plan of attack via global marketing alliance to have more breakthroughs in international markets such as China. The new partnerships will also bring about meteoric and better development of new technologies/products to improve competitive position. With alliance, Google can overcome deficits in expertise and creates new competitive capabilities by bringing together unique personnel of each partner. Lastly, it will help Google to achieve economies of scale and achieve better efficiency (Gamble Thompson, 2011).Defensive Strategies to Protect Company Market Position other alternative that we recommend will be for Google to adopt en garde strategy (Refer to Exhibit D) to enrich its competitive position. The purpose of defensive strategies is to lower the risk of beingness attacked, weaken the impact of any attack that occurs and influence challengers to aim their efforts at other rivals. There are two forms Google can take if defensive strategies are used. The two forms are blocking the avenues open to challenges and signaling to potential challengers that retaliation is likely.For example if Google were to choose to block the avenues open to challenges it has to be more innovative and be more receptive in learning culture differences while embarking on businesses with the Chinese in China. China is a country that contains massive human resources with germinal minds. Hence to block any new invention or products being produced, Google need to act fast by thinking differently and enhanced its research and development by being more unique and allowing creativity to flourish.If Google were to choose in practicing the l atter, its leaders need to be more vocal by publicly announcing managements commitment to maintain the firms market share, publicly committing the firm to a policy of matching competitors terms or prices or maintaining a war chest of interchange and marketable securities. However, Google must not be too vocal in a foreign land, especially China is highly unadvisable as Chinese do not enjoy firms that are too vocal and do not know the meaning of modesty. As a result, Google can end up losing its market share totally (Gamble and Thompson, 2011).Broadening the Diversification BaseWe think that it is important for Google to diversify into a new business with its existing products as it offers the potential to strengthen and build a better competitive advantage. Google is facing risk due to the increasing power of incumbent like social networks, which inevitably affect the search industry (For example Facebook has search function in their website). Thus through diversification, Google c an tap into the mobile world and reposition itself in the market by improving features offered by Android. We also recommend utilizing and incorporating Googles existing services such as Google Images and Google Maps to broaden the companys diversification base with new technologies in the market.In our daily course of work as consultants, we came across a new technology known as the Bokodes. This latest technology provides users with a more interactive approach to information at anywhere and anytime. It opens up a new range of applications in the areas of tagging, user interaction and near field communication. Google can also create an application using Bokode technology that reference to its current services such as Google Images or Google Maps (Refer to Exhibit E.) These can typically result in extensive co-marketing by giving Google many opportunities to widen its share of banner/video ads which in return builds more revenues as well as to be the pioneer in offering an innovativ e approach to consumers (Gamble Thompson, 2011).RECOMMENDED ALTERNATIVES/ EVALUATION AND LIMITATIONAmong the three suggested alternatives, we recommend that Google implements the defensive strategy. It is futile for Google to fight head with head against its competitors so defensive strategy will minimize the impact of rivals attack moves. This alternative will not cause much disruption and trade-off to Googles operation. As Google has already a grownup market base for its existing innovative products, it should focus its existing product categories in a specific market segment/geographic area. In addition, Google has innovative people and they have dynamic capabilities and core competencies to strive for continuous improvement and develop breakthrough defensive strategies. We will undertake a SWOT analysis (Refer to Exhibit F) to evaluate strength, opportunities and limitation (Weaknesses and Threats) for this alternative.CONCLUSIONIn conclude, Google is a firm that has great pot ential to expand its market position. However, expansion is not an easy task and it takes great strategy and meticulous planning for Google to achieve its objectives. Hence Google need to adopt an open mind in conducting its businesses and practice a strategy that will benefit them in the long run.Exhibit A (Overview of PEST Analysis)Political / LegalRegulation by US and China governmentSensitive data to be leak to terrorism, such as bomb making / mapLegal suit against Google for 3rd parties content and privacy such as Google mapPest AnalysisGoogle strategyTechnologyMaintains competitive prices with advance technologySuit the social lifestyle such as photo sharing, search trendAllow more business from all over the world to using internetEnsure technology do not hand to unnecessary legal issuesHardware getting cheaperEconomicSurvival during 2009 financial crisisHigh focus on advertisementSeen threat as opportunity, such as crisis. Individual are more keen on job search and financial new. Google will be their priority searchSocialNo age limitLife style changingIndividual are more educatedDemand increasing such as addition service, photo sharing, email, storageMore individual to own computer / mobile phone.Entrant LowTechnology easy to replicate.No specific standard for search engine oversized customer base, Low switching costCapital requirement is minimumNo geographic restrictionAuthority is monitoring Google activitiesSupplier LowSupplier is limitedSupplier is also competitor, such as Microsoft, AppleGoogle is heavily dependable on Microsoft and Apple OSSupplier has more control than GoogleCompetitor HighEasy to replicateSwitching cost is low or freeSupplier is also their competitor which are well informed of their productCompetitor has their own unique strengthBuyer/Customer HighCustomer lifestyle is changing rapidlySwitching cost is low or freeCustomer with all different demandsCustomer are well inform of the priceMany competitors to choose.Substitutes HighA dvertisement on traditional methodNewspapers, media, radio, search hotlineSwitching cost is lowExhibit B (Overview of Porter 5 Forces Analysis)Exhibit C (Suggested Plans for Strategic Alliances and Benefits)Alliance between Google and Microsoft Microsoft has improvise their depart search, Semantic Search capability and own approach to cloud computing to compete with Googles offensive strategy in substitute products. Semantic search engines will be the biggest threat to Google as it outshines its search engine by attaining more relevant search results thus threatening its core business by building a new search engine empire.Microsoft acquired a firm in the semantic field but the present technology has many limitations. Therefore, we recommend that Google get hold of a development alliance to fully develop this search engine. Google has highly capable people who are innovative, the joint effort will bury the overcompensate and occupy Semantic search a more powerful tool. With the alliance, both can incorporate this fully developed technology into their products, creating a win-win situation.The two companies can also collaborate together in cloud clouting whereby Google can use web based Microsoft Office (instead of Google web based software applications). Apart from having a great search engine and endless innovations, Google is still relatively new to applications that require high amount of user interactions. Tapping onto Microsofts cosmic experiences in technologies which drive the known Windows and Office suites, Google will undoubtedly benefit from Microsofts vast resources and makeing. As Cloud clouting will also lead to higher risk of privacy lawsuits, the collaboration will allow development of a better security program with encryption keys which provides reliable capacity in the cloud can be injected to prevent intrusions, resulting in reduced risks for both in authenticity issues.Alliance between Google and China Companies China has tight inter net regulatory controls which put Chinese companies like Baidu at advantage. In addition, Chinese companies will understand local culture better and can create products which will appeal to the Chinese more. Hence, it will be good for Google to enter into alliance with Chinese partners to have exploit knowledge on product market in order to tap on more china market shares and enhance competitive standing.To start the process, we recommend that they collaborate with partners (example search engine and social media) on marketing as it will entail purpose out what the china market wants and also build on knowledge with its resource market. From there, Google can customize and through their sales partners, market to whole of China in a cost effective manner. For example free download videos from the Internet are very popular in China. Perhaps, Google together with partners can make available free western Hollywood movies to China. This will help bolster its video offering/advertising revenues for ads display during the video.Other than that, they can sell Google phones or other smart phones bundled with Google/Android operating system. This will help them improve their mobile search market shares, banner ads and video ads within the China market.Exhibit D (Illustration of Putting Defensive Strategies in Its Place for Google)Google could revisit its strategy plan on an ongoing basis so as to improve its return on investment and position in the technology industry. Projected is the recommended strategy plan in adopting defensive strategy.Strategic AnalysisIndustry analysisTrends in the users preference, especially in search engine usage, advertising and China marketEnvironment forecast (internal/external)Analyzing competitors development esp. from BaiduAssessment of Google SWOT diagramMissionGoogle purposeGoogle valuesObjectivesSpecific targets (for example to be more innovative and creative in the search engine specialty internationally).Supporting Organizationa l ArrangementsStructure growthPolicies and profilesGoogles creative/innovative personnelRewards/benefitsActivitiesStrategy (Defensive)Concept on how Google will execute the defensive strategy to improve market positionExhibit E Bokode Imperceptible Visual Tags for Camera Based Interaction from a Distance(Data adopted from MIT Media Lab, 2009)It is a photographic camera-based interaction technology which an ordinary camera can take note small optical tags from a comparatively far distance. Consisting of a low-cost optical design whereby the tags reduces up to 3mm visible diameter, unmodified ordinary camera several meters away can be set up to decode the identity plus relative distance and angle. Bokode use intelligent binary coding to come close the relative distance and angle to the camera and show potential for application in augmented reality and motion capture.A user who is standing justifiedly in front of a shop wants to find out information about the shop and its surround ings. Hence, he did a search by using his camera phone to tag onto an image of the shop that has a visual Bokode tag embedded on its signboard. His mobile phone that has a built-in Bokode reader enables the user to gather information in a form of indifferent directions such as providing information about restaurants nearby, hotels information, transportation guide or it says the other brand of cereal are selling at a dollar cheap at the other supermarket store This technology can works in a wide variety of ways including classrooms, public places, print advertisement, outdoor billboards, product packaging and labels.Exhibit F SWOT Analysis of Googles adopting Defensive Strategy efficiencyInnovative and creative workforce. Workforce has strong passion in what they do and monetary value is not really an issue. Hence Google will be able to defend fast.Strong brand reputation so trusted by consumers. So it better for Google to build defense using existing products/services.Google leade rs are young entrepreneurs hence acting fast/defensive may not be an issue to them.WeaknessesCompetitor (Baidu) has superior access to distribution channels.Innovations are relatively easy to be imitated so good defensive tools might be duplicated.Google has a history of having offensive strategies which can cause the company to lose large amount of revenues.Google has too many services in order to dominate search marketing and be ahead of others to gain competitive advantage but some of these services are not widely used. Hence, being defensive they have to be more focus in developing the correct defensive tool.OpportunitiesMassive human resource in China to fully develop good defensive strategy (ability to tap on Chinese creative minds to enhance Google research base).Strategic alliances to join forces (Defensive) instead of fighting against competitors.New product incorporation (example Bokodes) thus creating good alternative to develop its defensive strategy.ThreatsImitation is a norm in China so competitors will still be fast enough to match any defensive strategy.Uncertainty in the external environment that is beyond control therefore comprehensive defensive strategy will still backfire.Chinese users are more loyal to local company resulting in smaller market share for Google (Defensive strategy in China backfires).