Google, Inc. (NASDAQ: GOOG) has risen from the ranks of startup to one of the most powerful advertising forces on the planet in about a decade. Although it maintains a corporate mantra of "don't be evil," the company's absolute power over the world of internet advertising borders on on the perception of monopoly just because it has the best product in all the right places. Notice I used the word "perception" there. Is Google a monopoly because it simply has the best product that customers apparently use and love? Of course not.Similar to how Wal-Mart Stores, Inc. (NYSE: WMT) rose to power, Google got there by providing something the competitors didn't: the best product presented in the best way that was the most useful for the consumer. Wal-Mart opened more stores and offered the lowest prices, and consumers noticed and made it the largest retailer in the world as a result. Google is the largest internet advertiser in the world using the same means in a way, but like Wal-Mart, it has competitors (albeit, with much smaller market shares).
But when a company controls so much of the ad market in the online space, smaller advertisers and businesses that want to break onto the scene and fight with larger competitors that may be slower and tuned out will have to use Google at some point. To grow, one simply cannot do business the way it was done in the past. Just like the small and scrappy manufacturer trying to get into Wal-Mart but can't due to the larger companies offering the same widgets at much lower prices, this effect works inside Google too. Advertisers bid on keywords and if they can remain relevant to the consumer within Google's search results, they can out-spend smaller advertisers day in and day out. Are these market forces some kind of monopolistic behavior? Google doesn't control this -- it is simply giving the most relevant information to the customer. Still, one can see the spot Google could be in very shortly, if it isn't already there.











Reader Comments (Page 1 of 1)
4-30-2008 @ 5:46PM
Kevin said...
I run a small business that gets the bulk of its leads from advertising on google.
Google has made it simple for everyone to compete and for the best man to win.
Google is a BOON to the small businessman, not "destructive".
If you use Google to advertise on then you will find that the "best" man always wins. No matter the size of business.
It is actually not possible to just throw money at Google and get the top spot. This is due to their method of determining placement. There are many factors besides the size of your bid that determine your ad placement.
Honestly, Google is the small business persons friend, just take some time to learn how it works and what their algorithms are looking for. Googles online tutorials tell you everything you need to succeed.