Diversification Strategies Case Study

Google’s Diversification – Is it the Right Move?

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Abstract:

Google, the largest and fastest search engine in the world, had grown exponentially and was the market leader in the search engine business. It had become the first company ever to have a 25% share in all US online ad spending. One of its major growth routes was through acquisitions. Google had acquired 26 companies from 2001 till 2006, most of which were small startups with innovative products or technologies. Although most of these businesses were not in line with its core area of search, Google had successfully integrated its acquisitions. This also resulted in Google entering new and unrelated areas. Analysts were skeptical about Google’s move and cautioned against diversifying into newer domains.

The case tracks the various diversifications and partnerships of Google and highlights how these have helped Google grow. The case facilitates discussion on whether Google was making the right move by moving away from its search business and entering new areas.

Pedagogical Objectives:

• To discuss the Search Engine business
• Growth by Acquisition
• Sustaining the Market Leadership Position.

Keywords :  Google; Diversification; Acquisition; Internet Search Diversification Strategies Case Study; Engine; AdWords; AdSense; Page Rank Technology; Google Search; Partnerships; Advertising Revenue Model; Competition