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Google has arguably been a big company for many years now, but it did better than most not to act like one. Big companies run by the whims of its shareholders and creditors, but Sergey and Larry have taken pains to run the company their way and have precious little debt. Big companies suffer from top-down planning, but Google allows employees to spend 20% of their time on personally-selected projects. Big companies begin hiring mediocre employees as they rapidly expand, but the founders have made a personal focus on high standards pay off. But I see a tell-tale sign of big company disease setting in at Google, and if it is the start of a trend, it has great implications for Internet marketers.

Somewhere, Steve Ballmer is laughing as he watches Google stumble with its message on its spanking new Android operating system and its even spanking newer Chrome OS. They've said that the two systems overlap in a few areas, then they said that they might come together. They'll say something else tomorrow, all of it confusing.

Google is suffering from a classic big company problem here. Google has gotten so large that they are now approaching similar problems with multiple solutions, assuming that they can fix everything with messages that correctly "position" the various approaches against each other.

Every company grapples with this issue as it grows, but Google has been remarkably adept so far at culling their projects to pick winners early in the cycle. Or, in the case of Google Video, allowing it to slowly die out after the YouTube acquisition, rather than causing customer confusion.

But this situation is different. Google is actively developing two seemingly separate operating systems, both built on Linux, which overlap with each other and (I assume) have different programming interfaces and user interfaces. I assume they are different, because it would have been relatively easy to talk about Android and Android Mobile if the differences were slight on the outside. That's how Microsoft positions its Windows operating systems and no one is confused.

No, it seems as though these are quite different on the outside, at least to developers, but maybe to users, too. And Android is already being used on netbooks, which Chrome OS will be, too. How do manufacturers decide which Google solution to use? How do customers decide which one they want when they buy a netbook? The laughter you hear comes from Redmond, Washington.

This is a classic big company problem. One group starts working on mobile phones and another on personal computers and they both come up with something good and, before you know it, you've got two solutions that have a very messy meeting in the middle at netbooks. And someone decided that positioning the message for these products would be good enough, which is what big companies do. They start to take a portfolio approach, believing that they need many different flavors of products to meet similar needs for different market segments.

Sometimes it works, but it often adds a layer of complexity that make large companies hard to work with. Honestly, anyone interested in using a Google operating system is not interested in trying to figure out which one to jump to and which one Google might abandon a couple of years in.

So what does all of this mean to Internet marketers? If this is just a temporary misstep by Google that they will rectify, then it might mean nothing. But if this is the start of a portfolio approach where Google begins to bring out multiple products and services that add complexity to what started out seeming simple, then a level of friction will emerge in the marketplace that will hurt Google in the long run.

Right now, many people latch on to Google offerings the same the way they used to eat up whatever Microsoft (and before that IBM) served up. "You'll never get fired for buying IBM" was the old saying that governed pack behavior right up until the early '90s when lots of people got fired for choosing IBM products that trailed the competition and were fiendishly complex to use. Part of the problem was that IBM had overlapping product lines where even the IBM salespeople didn't agree with which one was right for a particular client. In trying to be the right answer for every situation, they made life complicated for a clientele that wanted it simple by buying the product the best vendor offered.

Google faces the same dilemma. In its drive to solve every problem the best way, it might be losing its way on the very simplicity that market leaders can use as their competitive advantage. If Google takes the big company portfolio approach and begins offering niche products designed to appeal to every market segment, the complexity they interject will undermine their market leadership position.

After all, if you now need to get advice from an expert as to which Google offering to adopt, you might as well ask the expert, since he is already getting paid, to include offerings from other companies in the evaluation. That's bad for Google. When the market leader is well-accepted and it offers just one tool, you can skip the expert and just get that one. Google might be inadvertently giving its competitors a way back into the customer decision. Oh well, at least it is good for consultants like me...

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July 15, 2009

Mike is an expert in search marketing, search technology, social media, publishing, text analytics, and web metrics, who regularly makes speaking appearances.

Mike's previous appearances include Text Analytics World, Rutgers Business School, SEMRush webinar, ClickZ Live.

Mike also founded and writes for Biznology, is the co-author of Outside-In Marketing (with James Mathewson) and the best-selling Search Engine Marketing, Inc. (now in its 3rd edition, and sole author of Do It Wrong Quickly, named by the Miami Herald as one of the 11 best business books of 2007.


Good posting - only one comment. In practice IBM had hugely overlapping product lines all through the 90s (AS/400-iSeries, pSeries RISC and xSeries-x86 all very overlapping in some areas.) It was really the rise of Microsoft that provided another "nobody got fired for buying X" vendor.

Absolutely, Fred. The overlapping product lines actually go back to the 1980s. (I should know, I worked at IBM from 1978 until last year.) And your point is right on, that the rise of Microsoft made it possible to go away from IBM. My point is that IBM's complexity compared to Microsoft's simplicity was a factor in what happened, and I wonder of Google is getting sucked into the same portfolio trap.

Super post – though I think I sit on the fence with regards to trouble lying ahead for google. It may be the world’s cushiest number having a job there, but as you pointed out, the selection process for prospective employees is very tough indeed. They only recruit the best!
Therefore, if they have separate teams of the best staff working on individual niche products, and one customer identification team overlooking the development of all of them, then that team can effectively target each separate customer base effectively according to the needs of the customer. With great marketing effort it would work if each product target base was assured of some level of longevity with regards to production. Maybe this is their plan, effective targeting to turn niche into mainstream – I’m sure if it can be done on a large scale they can.

Google has more hits than misses, and so far they've done well in almost all their projects. Google probably realizes that it runs the risk of getting too big for its own good. There is no other way but up; at some point, they had to go down. They'd just have to make sure they survive the fall.

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Search Engine Guide > Mike Moran > Google Suffering from Big Company Disease