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Google Plus Desperation Marketing

The reaction to Google Plus makes clear the lack of understanding that exists about pervasive online products and services. I am cranking away on my Enterprise Technology Management column, a for fee task, but I had to take a moment to offer some observations on the hurricane of hoo-hah which is raging.

Navigate to “Google Likely to Face FTC Complaint over ‘Search Plus Your World‘”. The story does a good job of explaining the new servicer in a way that appears to make sense to a person who uses online but does not understand its imperatives; to wit:

Google calls the new feature rolling out to users of its English-language search engine “Search Plus Your World.” It blends information such as photos, comments and news posted on its Google+ social network into users’ search results. It mostly affects the one in four people who log into Google or Google+ while searching the Web. Those users will have the option of seeing search results that are customized to their interests and connections, say, a photo of the family dog or a friend’s recommendation for a restaurant. Google has been working for years to create a personal search engine that knows its users so well it delivers results tailored to them. It’s also trying to catch up to social networking giant Facebook, which, with more than 800 million users, knows its users far better than Google does. But critics contend Google, a laggard in social networking, is using its dominance in Internet search to favor its own products and take on its chief competitor.

Like many of the other posts from “experts” and pundits, a number of assumptions operate to characterize Google’s actions are controversial, limiting, or designed to have quite specific consequences for users, competitors, and stakeholders.

My view is based on the research I conducted from 2001 to 2008, the period in which the bulk of my Google work took place. If you are curious about my monographs, there are descriptions of these publications at this Infonortics’ link for the Google Trilogy.

First, once a company captures a “place” in online, the successful service acts like a magnet. An unsuccessful service in the same space pulls marginal users at first and then “pumps” those users into the primary place. Google was an early entrant in social with Orkut. For reasons which I am not at liberty to discuss, that service did not capture a “place”. MySpace did but failed to respond to the Facebook approach. As users flowed to Facebook, the Orkut, MySpace, and other social services began to amplify the Facebook service. The result was the steady expansion of the service despite its flaws. As those who have watched a service benefit from the competitors’ amplification of the dominant service, there is little which can be done to halt the growth. Facebook, like Yahoo in directory services and Google in traditional Web search demonstrated, the new service surges and then has its own life cycle. Not even shooting oneself in the foot or regulation can stop the expanding service from becoming a monopoly. Facebook has achieved that position and it will eventually decline. For now, Facebook, like it or not, is the social focal point. Google has limited choices. One of its options is the walled garden and taking tactical actions that will get Google back into a growth position in the disputed “space.”

Second, when a competitor tries to capture the number one position in a new space, the work we have done over the last 30 years suggests:

1. The maximum market share which the tactical actions can yield will be about 60 percent of the leader’s market share. Usually, the share is much less. Facebook, therefore, is not likely to be significantly affected in the short and mid term by Google’s or any other competitors’ action. Facebook is at greater risk of making errors in judgment related to management, money, and technology than what Google or any other competitor does. So Google is under pressure and Facebook is cruising.
2. The dominant service benefits from the added visibility to high profile tactical moves create. It would not surprise me if  Facebook benefits from Google’s actions related to expanding its walled garden, getting into he said, she said arguments with services like Twitter, and its senior management making statements which throw dry logs on a raging digital marketing fire. In short, Google is helping out Facebook if our research is on the money.

Imagine how difficult it must be for Google to be largely excluded from social services. Now consider that the focus of Google is upon capturing a space which may be unobtainable. Do you expect Google’s thinkers to find a checkmate type of solution from the company’s recent tactical actions? I don’t. I think Google is trying to find a solution, not implementing a solution.

Finally, Google is now in a precarious positions. As I write this, the search services from Yandex.ru and Yandex.com are often more relevant than those delivered by Google’s service. The Yandex technology like Baidu’s and Jike’s shares some characteristics with Google’s. The shift in precision and recall at Google is a direct result of manual and automatic adjustments to the advertising imperative that keeps Google in revenue growth mode. Services which focus on precision and recall deliver results which our research indicates are more relevant when measured by traditional information retrieval yardsticks. Google, therefore, is now at increased risk of a thrust at its core business by capable, technically adept competitors. Little wonder why some have reported that Google is sending mixed signals or that Google’s management is engaged in healthy discussion about what to do a situation which simply did not exist when Google grew due to the inattention of its competitors in 1998 to 2004 and in 2006 to 2007 when there was zero significant awareness of the “legacy” of the Google method. Now the “legacy” is part of Facebook’s and other competitors’ equipment for living. Google is in an unfamiliar position. As I have learned in my own online work, the unfamiliar translates to an increased likelihood for acting with a certain blindness. One can get hit by a very loud, very large, and very slow moving bus when one is blind.

Net net: Google is at a turning point. The evidence is the discussion about Google Plus and its walled garden approach, the spectrum of commentary about what is a quite predictable, if ill considered innovation from Google, and from the comments made by Google’s competitors.

Because online services, if they grow to more than 65 percent of a particular market, naturally become monopolies. Management will take credit for this success, but it is often inevitable, not the result of a brilliant executive decision. Online monopolies chug along and then—boom—arrive and get noticed. A recent example is the Apple iTunes, iPhone, iPad situation.

I want to see how the power flows from centroid to centroid in dataspace. The physics of information permit behaviors which are difficult to predict and have unforeseen consequences. One consequence: desperation marketing. She has swept in with Google Plus I submit.

Stephen E Arnold, January 12, 2012

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