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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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