Enter a search term such as “mobile analytics” or browse our content using the filters above.
That’s not only a poor Scrabble score but we also couldn’t find any results matching
Check your spelling or try broadening your search.
Sorry about this, there is a problem with our search at the moment.
Please try again later.
Are Google's best days behind it? The company may be one of the most recognized brands on the internet, and one of the most important technology companies in the world, but Google isn't quite growing like a weed anymore.
That gives analysts and pundits plenty of ammunition to ask whether Google's future is less bright than its past. Fortune is the latest publication to promote the notion that "the search party is over" for the Mountain View search giant.
In an article entitled 'Google: The search party is over', Fortune's Michael V. Copeland and Seth Weintraub suggest that Google is facing a "classic Innovator's Dilemma" and will have a difficult time finding new areas of growth on the internet of today. They paint a picture of changing consumer behaviors and preferences that could leave Google out in the cold:
Five years ago you would have simply Googled it, looked at the list of results, weighed your options, and made the purchase, perhaps by clicking on one of the sponsored links that accompanied your search. Today you might still do that, but increasingly you might pose the question "What running shoes should I buy?" to your friends on Facebook, or maybe write "Who knows about training for marathons?" on Twitter. By the time shopping service Groupon sends you (and 25 of your friends) an offer for the perfect shoes and registration for a race, you'll probably just pounce on it.
According to Copeland and Weintraub, Facebook poses an existential threat to Google. "Not only because social networks (and those used for work like LinkedIn fall into that same category) offer a substitute for search for consumers, but also because they offer a substitute for advertisers as well," they write. "In display advertising, for example, Facebook has a 16% share of the roughly $9 billion market, according to comScore (Google sites have 2.4% of the market), and advertisers say they're looking for more ways to plug into Facebook."
Of course, the authors conflate Facebook's position in the display market; Facebook controls 16% of the display advertising market in terms of impressions served -- not revenue. Such an omission, intentional or unintentional, is worth pointing out because it shows how numbers can easily be manipulated to provide 'evidence' for something that doesn't exist.
To be sure, Facebook is an incredible company and it may very well reach Google-like proportions. Culturally, Facebook's impact can't be minimized. But even with 500m users, Facebook is no substitute for search. While it's easy for journalists to write a story glamorizing, theoretically of course, the use of Facebook to run everyday search queries, the truth is that there's little evidence to back up the notion that 'searches' on Facebook are replacing Google search queries. To the contrary: in December 2009, comScore estimated that Google saw 88bn search queries globally. That's billion with a 'b'.
But according to Copeland and Weintraub, Google is simply too utilitarian:
Coates's point is that you don't have friends on Google, you have contacts and tasks. These services reflect an engineering culture that's all about utility, but one that makes it hard for the company to create something that's friendly and social. But if Google can change its utilitarian ways, the company stands a real chance of tapping into that next growth engine. Imagine if it added that social layer to its core search business and to Android, and blew it out on YouTube, giving people a reason to hang out on Google sites for long periods. Advertisers would come flocking. If it can get that right, as the former Googler now working in social media sees it, "Google would be unstoppable." Just like it used to be.
There's just one problem with this statement: the advertisers have already flocked to Google, and they by and large keep coming back. The company did $6.82bn in revenue last quarter and is close to a corporate printing press as one will find in the tech world. Google also sits on a cash hoard of more than $30bn, evidence of just how profitable its core business of search advertising is. Is revenue growth slowing? Sure. But that happens to all companies that grow large and mature. Microsoft was a 'mature' business well over a decade ago and it still produces billions in revenue every year.
Facebook may be interesting to advertisers, but Facebook's self-serve ad platform is no AdWords. Which is why you generally see fewer advertisers representing fewer industries, and lower CPCs, on Facebook. It's also why you'll find lower quality ads and advertisers. Case in point: the last ads I saw on Facebook promised me a flat belly, encouraged me to enter a free dog photo contest and a free baby bottle cooler. I don't have a gut, I don't have a dog, and I don't have a child. I suppose those ads are 'friendly' and 'social', but they aren't applicable to me. I much prefer the ads I receive when I do a search on Google because most of the time, they're relevant to what I'm looking for.
At the end of the day, the risk for Google is not that it won't develop the next big thing. Sure, it can't stop evolving and trying to innovate. But there's far more risk in Google losing sight of its core business and trying to become the next Facebook than there is in Google continuing to deliver the best possible search experience. That's why Google should ignore tech pundits, analysts and journalists who suggest that the company needs to fix something that isn't broken. Google is a search company, and anybody who says that the company's party is over when it's generating billions in profit every quarter clearly doesn't have good taste in parties.
Photo credit: icanteachyouhowtodoit via Flickr.