Introduction
Google Incorporation as an internet search technology has today become the most popular search engine used by companies, business persons, bloggers and scholars across the world. With today’s changes in technology, the search engine has become an important tool in web paging since it provides users with the greatest level service satisfaction (Jason & Kevin, 2005). As an algorithm technology, Google provides users with possible web pages, measures the significance of different web pages and provides numerous variables that can be used in solving different equations.
According to studies conducted in the past, the success of Google Company lies in its financial base and corporate ethos. For example, the company relies heavily on web advertisements as its main source of revenue (Quelch & Jocz, 2010). However, the Google Company ended up facing stiff competition and scrutiny from other companies like Microsoft, Yahoo!, and Meta search technologies. The kind of competition and scrutiny the company faced in the past motivated its desires to open and operate new markets like China.
Problem statement
Even though Google used to enjoy stable and more secure financial position, its decision of going public led to increase scrutiny and growing competition. For Google Company, the market was becoming overcrowded with new internet search companies that provided different types of services to respective users. The company, therefore, felt that the only way to outdo the competition was to venture into a more secure business environment; the Chinese market. The declining revenues meant that Google Company had to design better entry strategies in Chinese market despite the strict government rules and regulations concerning conduct and content of information on the internet.
Environmental strategies
From the article “Google in China,” the Chinese authorities did not welcome the vast uncensored information that was spread through the internet and other social media (Yang, 2010). Unlike in the case where companies could gain direct entry into internet markets in other countries, operating business in China was a bit tricky since government officials had developed rules that restrict the functions of such companies. Through its monitoring and enforcement system, the Chinese government developed the most sophisticated network for limiting information online. In order to regulate the kind of information passed through the internet, the monitoring and enforcement system employed two approaches (Jason & Kevin, 2005). The restriction of production, development and dissemination of improper information became a challenge to majority of these companies. Second, the regulating authorities had access to internet content and this was perceived by customers as unethical since some information needed to be kept secret.
The experiences of consumers as far as internet services are concerned provided a benchmark on the best entry strategy that the Google Company could use to explore the China market. The first strategy included the use of Chinese-language version of the Google home page (Jason & Kevin, 2005). This entry strategy was used in early 2000 with the main objective of maintaining a Chinese-language version of Google Company that could allow search requests originating from China. Through this strategy, the Google Company ensured that its technologies were not subjected to Chinese censorship laws since the facilities were not within the country’s physical boundaries (Quelch & Jocz, 2010). Similarly, the Chinese-language version of Google ensured that the company did not need a license from the government in order to operate or protect its businesses. The new version of Google language allowed users to access the full information about their search as well as the list of contents the government considered unlawful.
Even though the information the search requests that were processed by Google passed successfully through one of the Chinese international gateways, there were still possibilities that the content could be checked and blocked (Jason & Kevin, 2005). For example, Google in China became inaccessible for close to two weeks and when it was reinstated; the system became much slower in inconveniencing for all the users.
Alternative strategies
The slower network coverage and inability to allow full access to internet information made the company to understand that its entry approach in China market was no sustainable. The company realized the need to first understand the market by taking a one-year market analysis, consulting the government, non-governmental organizations, individual investors and internet experts (Helft & Barboza, 2010). Through the levelled consultation, the company decided to develop a different brand name; Google.cn as a response to the market fluctuations. The new brand and its search contents were specific to China and subjected to the country’s censoring process. The company realized that its new product was faster, highly reliable, and provided Chinese users with better search options that the original Google product.
After company’s new creation that was highly selling in China, Google realized the needs to make its products different from other products offered by competitors. In this relation, it was important for the company to keep personal information outside China through Gmail; disclose government’s attempts to filter information to used; and continued with the Chinese-language version of the original product (O’Rourke, Harris & Ogilvy, 2007). Through these strategies, the company as set a successful base for its operations in China and maintains a greater portion of the market share.
Recommendations
In this case analysis, the major challenge the Google Company faces is stiff competition from other potential companies like Microsoft, Yahoo!, and Meta search technologies as already mentioned under the introduction. While venturing into new markets could be one of the solutions to this problem, the cost of opening and operating such markets could be higher (Jason & Kevin, 2005). As an alternative to operating new markets, Google Company can merge with smaller companies; extend its services even to the more competitive companies and get to learn their business strategies. Through mergers, there will be a reduction in number of companies and therefore a decrease in levels of competition,
References
Helft, M., & Barboza, D. (2010). Google shuts China site in dispute over censorship. NY TIMES.
Jason D. & Kevin D. (2005). “Limited Search: As Google Pushes into China, It Faces Clashes with Censors,” Wall Street Journal.
O’Rourke IV, J. S., Harris, B., & Ogilvy, A. (2007). Google in China: government censorship and corporate reputation. Journal of Business Strategy, 28(3), 12-22.
Quelch, J. A., & Jocz, K. E. (2010). Google in China. Harvard Business School. Harvard Business School. Press.
Yang, M. Q. (2010). Effective Censorship: Maintaining Control in China. Penn Libraries: University of Pennsylvania. Press.