This is Why Google Scares the Sh*t Out of Companies

On October 29, 2009, In Biz, By Tac Anderson

Wow. I mean really, WOW! One announcement of a Web based product that is currently inferior to your product that only runs on a very limited number of devices and your company looses Billions of dollars. Wow.

This is what happened to TomTom and Garmin stock prices when Google announced Maps Navigation. I suspect their stock prices will come back *some* but not to their previous levels. A new bar has been set and it’s very, very low. There was a certain amount of value in those companies because there existed a barrier to entry: satellites, relatively expensive hardware, distributors, supply chains, etc.

Google had all of that or didn’t need it. New rule book and they made it up.

via mashable.com

Now a similar announcement by a different company wouldn’t have had this effect. But it’s Google. And Google doesn’t play the way your company does. It doesn’t have the same cost structures and it has a major cash cow that can fund that free product for many years before it becomes profitable. Basically long enough to drive you out of business. (This reminds me of another company in the 80’s and 90’s)

Google scares companies. But Google is also starting to scare people. It was bad enough when the only real data they had on you was your publicly available data and your search history. But now imagine a scenario that Louis Gray is toying with, where someone goes all Google.

You run the Chrome OS, which is basically the Chrome Browser running on Linux. You use only the Google Docs product and of course Search and Gmail, then Google Chat and  Google Reader. Now throw in to that an Android phone with GPS and Maps Navigation.

Google knows every Web page you visit, every search you make and has your documents and email in their searchable database, plus they know where you are at any given point (because no one goes further than 10 feet from their phone anymore).

As a user you can control the products you use and where your data is stored (at least to some degree). But as a company how do you compete with this?

A few days ago  I suggested every company needs to be reevaluating all aspects of their business and I meant it.

Going even further back, two years ago (ironically when writing about Google and their effect on your business model) I suggested to disrupt your own business model. Don’t wait for Google or someone else to disrupt your model do it yourself. At least theoretically. This way you’re less caught off guard and maybe even come up with a whole new business.

HP did this when they launched their Ink Jet devision to compete with their highly profitable LaserJet devision. Google even did this when they launched Google Wave, which is *supposed* to be a replacement for email.

What does your disruptor look like?

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Google Falls For The Hype Cycle with Wave

On October 13, 2009, In Biz, By Tac Anderson
2 Hype album cover
Image via Wikipedia

One of the more interesting things about being a parent is watching your children grow up. Especially as they begin to make more independent decisions, you start to get an idea of what kind of adult they’ll be.

As a business junkie the same is true as I watch companies “grow up” and scale. Two companies that I have always enjoyed watching are Google and Apple. Both of these companies are extremely successful and profitable in their own right but compared to many of their Fortune 500 counterparts are still relatively *small*.

How can I say Google and Apple are small? Well on one level they are small. Compare them to companies like HP and Microsoft (disclosure: both Microsoft and HP are clients of my employer Waggener Edstrom):

  • They don’t have nearly the number of employees. Especially if you count contractors and agencies. Google and Apple seem to do most of their marketing in house, while you’d be hard pressed to find a firm that hasn’t done work for HP or Microsoft.
  • Microsoft has 14 businesses all doing over $1 Billion annually and did $60+ Billion in 2008.
  • HP grew during 2008 and did $118 Billion.
  • Apple’s revenue in 2008, while strong was only $32 Billion. (That’s half of what Microsoft does annually and about what HP does in one quarter.)
  • And the mighty Google? It’s impressive to think that they make most of their money one click at a time and get pennies for each click but with as omnipresent as they are they only did $21+ Billion in 2008.(yes I realize the irony in saying *only* 21 Billion)

Related to bullet point #1 is the way Google and Apple go to market with new products. Apple has Mac World but other than that they don’t have to do much hype building.Their fans do more than enough for them.

Google usually does even less. Their approach is sometimes a blog post, along the lines of, “Oh yeah we just launched this new product. Leave us a comment and let us know what you think.” That’s a big product release. Usually they just roll out the feature or put something in the Labs and wait for people to notice.

As someone who works in marketing (I’m resistant to calling myself a marketer) I’m often at awe with this approach. I’ve even encouraged my clients to do the same thing. You don’t need a press release for every little thing.

But something different happened in May. May is when Microsoft launched Bing (again full disclosure, I work with the Bing account). Google publicly dismissed it (of course) but I think they were a little nervous. The same day Bing launched Google pre-released Wave. They had a conference, demoed the product (that they admitted was not ready for release) and got everyone very excited. This is a classic product marketing move. I know people at HP that live for stunts like this.

But to my knowledge, Google’s never done something like this before (please correct me if I’m wrong). I use and love Gmail and Google Reader among many Google products but something never sat right with me about Wave. What need was it serving? To replace email? Most email is not working on a collaborative project. Google has struggled with integrated products (but they are getting better), was this just going to be another standalone product?Was it going to replace Gmail? Too many questions IMO.

I though maybe I was jaded because of my client work. So I held my tongue. But I wasn’t the only one skeptic. TechCrunch’s own MG Seigler predicted backlash. Google turned on the hype machine and now they had to deliver.

While Wave is an impressive application with a lot of potential it hasn’t lived up to the promise. Most early adopters are unimpressed.

Google Wave crashes on beach of overhype

But this service is way overhyped and as people start to use it they will realize it brings the worst of email and IM together: unproductivity.

Google has fallen victim to the same hype cycle the it’s much larger competitors have fallen victim to over the years. In all fairness it’s easy to do. Big public companies have a lot of pressure on them to return results quarter after quarter. They either have to grow revenue or cut expenses. Neither of which are easy but the latter is especially tough because it often means cutting jobs. The question is, will they try it again?

Apple hasn’t been without its own troubles and missteps this year. But I’ve blogged about those already.

As both Apple and Google grow they are going to have to learn some of the same lessons that Microsoft and HP have had to learn. Growth isn’t easy. Scale is really tough. You can’t make everyone happy.

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A Closer Look at HP’s Community Core Team

On April 25, 2009, In Comm, By Tac Anderson

Now that I’m leaving HP, they are going to delete my neglected HP blog (unless I find someone at HP who wants to take it over). So there are a couple of posts I wanted to rescue from there and bring over here. Originally Published 8/5/08

A Closer Look at HP’s Community Core Team


Many of you have probably heard about the new book, Groundswell: Winning in a worldtransformed by social technologies.

The book was written by Forrester’s Charlene Li and Josh Bernoff and published by Harvard Business Press.  First off I have to say that it’s a great book and you should go get it.  Second I wanted to shed a little light on a portion of the book that has to do with HP.

Alison Watterson , who is mentioned in the book,   is  manager of Corporate Web communications and leads our corporate blogging initiatives.  Among her other duties she runs a group called the Community Core Team (of which I’m a member).

This group is fascinating to me for several reasons. First off it is one of very few truly cross organizational groups that is comprised of  people with Web marketing jobs throughout the company.  This means that everyone in the group participates in addition to our regular  job responsibilities .  Each of us is passionate about social media and often (but not always) are engaged in our individual business units online social activity.

The group is responsible for reviewing and approving new blogs (not individual blog posts just brand new blogs).  The group also tackles new developments in the social media space.

HP was an early adopter of corporate blogging and started having company blogs back in 2004. At last count we have 55 HP blog (hosted on HP’s platform), 12 employee business blogs (not hosted on HP’s platform but still about HP) ranging from printing, marketing, software development to corporate social responsibility, servers, photography and research.  We have individual bloggers, group and team blogs as well as non HP guest bloggers. You can see all of these listed on the right hand side of this page along with links to our various communities and HP employees personal interest blogs.

To me this represents the perfect mix of corporate structure and Web 2.0 openness.  We have a blogging code of conduct and Alison is there to fill in the gaps, but beyond that no one is there to watch over the bloggers shoulder. (With 67 blogs and even more bloggers that’d be a lot of shoulders to watch over.)

It’s a great group to be involved with and learn from as we are constantly re-evaluating what’s working, what’s not and how to address new developments as they arise.

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Social Media is not a back channel

On January 21, 2009, In Comm, By Tac Anderson
ARLINGTON, VA - OCTOBER 20: Republic of Korea...
Image by Getty Images via Daylife

Peter Shankman has a great story about an agency guy that tweets about his distaste for Memphis while visiting FedEx to do some social media training. Oops. He got busted big time.

People have a tendency to get comfortable social media. Too
comfortable. There’s no shortage of examples where people post
incriminating photo’s on their Facebook or MySpace pages.  This is a problem that’s only going to get worse.

Like many HPers, I first joined Yammer after they won TechCrunch50.
I was first excited about the product (and I think it has a lot of
potential) but for me I didn’t find much to post there that I wouldn’t
post on Twitter. I think it has potential for two reasons:

  • Some employees like the idea of Twitter but don’t want something so much out in the open
  • There are things you may want to say to employees that you wouldn’t say on Twitter

TechCruch reports that Yammer has just raised it’s first round of funding. Yammer Raises $5 Million For Workgroup Micro-Messaging
So other people obviously feel it has potential as well.  Yammer has a
nice business model. It’s free to any employee with a company email. If
you want to control this group, say exclude people who have left the
company since signing up, or brand your companies page, there’s a per
user fee. This is great for small businesses who want a company wide
back channel, this doesn’t make sense for large enterprise customers. I
haven’t checked recently but I’m sure that if they don’t know, at some
point they’ll offer enterprise licensing.

In last week’s core community group the issue of Yammer came up. (I’ve mentioned our core community group before and written about it on my HP blog.)
The question was basically “What do we do about this?” It’s a very
valid question. The Yammer community is kind of a HP community, but no
one at HP gave them permission. The concern is that employees will
treat this like an official HP communication channel. Or just get a
little too comfortable with it and start saying too much.

HP has an official policy in our standards of business conduct which
applies to all company communication, to paraphrase: you don’t share
privilaged information through non secure channels. This means you
don’t send email to the wrong people, you don’t talk about certain
things outside of work, etc.

I quickly made the point that Yammer is no different than Ning, Facebook groups, LinkedIn
groups or anyother employee group, of which there are many. Anyone
could star a group for employees and people do. The thing to remember
is that these are not official and secure channels.

We will see a time where someone screws this up. Hopefully not at HP
but someone at some company will. We’re not perfect. Just like people
say the wrong things in email and to the wrong reporter, people make
mistakes.

I’m proud to say that the group at HP didn’t freak out and didn’t
try and shut it down. Instead we decided to make sure that our business
conduct standards are emphasized and updated to explicitly include
social media platforms.

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