GOOGLE VS FACEBOOK Micheal Porters Five Forces industry analysis and strategy development is a staple in most business schools. Having come across it again in book I was reading I decided to apply it to our web design industry to see what kind of analysis we get. The result was not promising. FIVE FORCES MODEL FIVE FORCES MODEL Rivalry among existing competitors Threat of New Entrants Bargaining power of buyers Threat of substitue product or services Bargaining power of suppliers Threat of New Entrants Very High
Bargaining Power of Suppliers Moderate
Threat of Substitute Products High
Bargaining Power of Customers Low
Competitive Rivalry within an industry Very High
FIVE FORCES MODEL Conclusion : Surviving in an industry where the 5 forces are so strong and prevalent is about choosing a strong value proposition and sticking to it. Changing often or trying different positions will kill you. The survivors will be the ones who successfully build and defend a value position. This is a marathon not a sprint. Stick to your knitting, try and build a unique position and you might be one of the winners when the dust settles.
FIVE FORCES MODEL EFAS FOR GOOGLE AND FACEBOOK External Factor Evaluation (EFE) matrix method is a strategic-management tool often used for assessment of current business conditions. The EFE matrix is a good tool to visualize and prioritize the opportunities and threats that a business is facing.
EFAS FOR GOOGLE Particulars OPPORTUNITY weight Rate Weightage Score Comments Brand image 0.1 5 0.5 Google is prominent in the market which can easily persuade users to use its application Innovation 0.25 4 1 They came after facebook in social networking i.e. google, however, they 100+ features in it. Revamp/Redesign of product 0.1 5 0.5 Defensive strategy Penetration in the Anroid design 0.1 5 0.5 Increase Users Particulars Threats weight Rate Weightage Score Comments Social Network/ Media 0.2 3 0.6 Social network change their objective from accessibility to social networking i.e. introduction of google however at first orkut was accepted as successful social network Government Restriction 0.05 4 0.2 They officially avoided to unethical move that can bring google to under further investigation Gradually Increase of shares 0.15 3 0.45 No comments Rumor / Bad Publicity 0.05 1 0.05 Google has not taken any action against bad publicity campaigned know by facebook EFAS FOR GOOGLE Total 1 3.8 EFAS FOR FACEBOOK Particulars OPPORTUNITY weight Rate Weightage Score Comments Social Science network 0.3 5 1.5 They were first who came up with this idea Increase of shares (gradually) 0.15 4 0.6 Their shares were steadily moves up with such a tremendous growth Government Ristrictions on google 0.05 2 0.1 They take the advantage of this event Innovative 0.20 3 0.6 They were the first who came up with this idea Particulars Threats weight Rate Weightage Score Comments Google linking twitter 0.15 2 0.3 They face problem of dealing with such event Penetration in the devives 0.10 2 0.2 They effectively cope up with this situation Branch image of google 0.05 2 0.1 Google Is a big giant so they use the strategy effectively TOTAL 1 3.4 EFAS FOR FACEBOOK EFAS FOR GOOGLE AND FACEBOOK Conclusion: The above results from the table showing that Google has the weighted score of 3.8 stating average external factors in particular company. However, Facebook has the weighted score of 3.4 stating average external factors but higher than the Google. However both have performed above average.
CPM FOR GOOGLE VS FACEBOOK A Competitive Profile Matrix is a strategy by the management of a firm that is intended to compare it with the major firms of the industry. The CPM shows the firm its weak and strong points as compared to the major players in the industry. The CPM takes into account effectiveness of advertising, product quality, management, finances, the prices and competitiveness among other factor.
CRITICAL SUCCESS FACTOR Critical success factors are extracted after deep analysis of external and internal environment of the firm. Obviously there are some good and some bad for the company in the external environment and internal environment.The higher rating show that firm strategy is doing well to support this critical success factors and lower rating means firm strategy is lacking to support the factor.
COMPETITIVE PROFILE MATRIX EXAMPLE CPM matrix shown below show the comparison among Google vs Facebook.
Critical Success factor Weight Rating Weighted Score Rating Weighted Score Social Web 0.2 4 0.8 5 1 Redesign product 0.2 5 1 3 0.6 Financial position 0.15 5 0.75 3 0.45 User loyalty 0.05 4 0.2 4 0.2 Growth in market shares 0.2 3 0.6 4 0.8 Workforce 0.1 4 0.4 4 0.4 innovation 0.1 3 0.3 4 0.4 Total 4.05 3.85 Google facebook THANK YOU