Google Business Strategy: Critical Essay

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Google merchandise store is an e-commerce platform that specializes in selling Google product merchandise just as the name implies. It is operated on behalf of Google by Brand Addiction, a global promotional merchandise business.

Google merchandise store is currently at a level one business maturity model, with only a static web presence and broadcast model of communication, the proposition is to move the business into a level three model where most of the business’s functions and decisions will be digital and data-driven.

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This digital plan focuses on Nigeria. Nigeria is a huge market for e-commerce, with a huge population and continuous growth in internet usage. According to statista.com, the number of internet users will grow exponentially from 72.4 million people in 2017 to 187.8 million people in 2023. Google currently has a big market in Nigeria and can leverage that to create brand loyalty in its buyer personas. According to Alexa.com Google is the most visited site and most popular search engine in Nigeria.

Successfully marketing and selling Google product merchandise in Nigeria will ultimately promote brand awareness on Google products like YouTube and Android, and also provide more profit for Google as another stream of income.

Before implementing a digital strategy, a clear identification and understanding of the organizational needs is required, this will shape the actions implemented and ensure that they are perfectly suited for the business. There are 2 factors to consider, the external and internal environment, with this insight the buyer personnel can be identified, and their needs and wants can be met. (Aleksej Heinze, Gordon Fletcher, Tahir Rashid and Ana Cruz, 2017)

1. External Environment

The external environment consists of two considerable factors, the micro and macro environment.

1.1 Microenvironment

These are the forces that are closer to the business in terms of how they can affect the business, they have a direct impact in delivering value to the buyer persona.

Competition

One simple yet powerful tool for analyzing competition in the microenvironment is the five forces model by Michael Porter in 1979, although it has its criticisms, the 5 forces are an effective framework for competitive analysis. The main purpose of this model is to establish deeply the root causes of profitability in the industry through its competitive forces.

Rivalry among existing competitors

The rivalry between merchandise brands is low, although if you expand the competition beyond the direct competition and look at the indirect competitors in terms of the mass market. So, it can be said that rivalry among existing merchandise competitors is low, but rivalry within the whole commercial market is high.

The threat of New Entrants

The threat of entrants in the merchandise business is high, it does not take much upfront investment to start a merchandise company, especially for big businesses in Nigeria like Apple, Shoprite, or Microsoft who might see this as a business opportunity. It is a relatively easy business to start, there is no special set of skills required to start. Although, because of its popularity, a sentimental attachment to the Google brand from customers may give Google a slight competitive advantage over its other rivals.

Threat of Substitutes

In terms of the merchandise industry, it can be said that customers would rather buy merchandise products like bags, T-shirts, Laptop cases, and sunglasses if they can relate to the brand, or if they have any connection with the brand. But in terms of need and necessity, consumers can find so many alternatives to this product, especially in a heavily commercialized market like Nigeria. There are a number of substitutes available in the Nigerian market, especially because of the prevalence of counterfeit products for lower prices in Nigeria. According to a study conducted by Solomon & Adeyemi (2012), there is a high knowledge of products that have been counterfeited in Nigeria, which proves just how big the market for counterfeited products is.

Bargaining power of suppliers

The bargaining power of suppliers in this industry can be considered high. When looking at all the processes and major inputs required to run an eCommerce business. It is a business dependent on manufacturers and delivery companies. Google merchandise store does not have an in-house team for this feat, Brand Addiction handles all supplies for the business.

Bargaining power of buyers

The bargaining power of buyers in this industry is high. Although the market for this type of product is huge, the supply is equally as high. Customers are able to check for different product prices online on other e-commerce platforms and can also go to visible markets to get informed decisions and compare prices of different products.

Market Trends

Google Trends is a tool that is used to analyze comparative and popular top search quarries.

The data in the figure -- below proves that the word “merchandise” does not have a lot of popularity in terms of search quarries in Nigeria. This can further prove that products

In going deeper, looking at the figure – below, the data for the number of times “merchandise store” was searched for in Nigeria is non-existent, which can prove that Merchandise stores do not have enough popularity in terms of queries in Nigeria as it is.

Buyer Persona

Access to the actual buyer persona target is limited, although from Google Analytics, we

can deduce who the current buyer persona is by looking at the demographic of the

actual buyer persona of Google merchandise store is.

1.2 Macro Environment

Table 1 displays a PESTE analysis for the Google merchandise store. This analysis provides a more in-depth context for the digital plan and informs the SWOT analysis. It is important to note that the PESTE analysis does not cover all sides of the business implications, hence why an ensuing microanalysis is important.

Political/Legal

Nigeria is a politically stable economy in terms of policies and implementations of business regulations, although it is a country with a very high corruption rate which can impact businesses negatively or positively even. According to theglobaleconomy.com Nigeria has a low control of corruption level.

Economical

The middle class in Nigeria makes up 23% of the population and has an estimated potential market value of over $28 billion USD, which will only grow as the middle class expands over the coming years. (Shannon McCroklin, 2018)

In 2018, Nigeria’s GDP was 397.3 in billion US dollars, the inflation rate for Nigeria was 12.1%, the Annual GDP Growth Rate is 1.50, and the GDP Per Capita was 2,049 US dollars. The GDP per capita of Nigeria increased from 496 US dollars in 1999 to 2,049 US dollars in 2018 growing at an average annual rate of 8.73 %. according to Knoema. With this in mind, it is also important to understand the dominance of informal trade in Nigeria. According to research conducted by Business Chief, “87 percent of the trading in Nigeria happens in informal markets.” Informal trade is not tracked or included in overall Gross Domestic Product calculations, which means Nigeria’s economy is more prosperous than GDP alone can represent. (Shannon McCroklin, 2018)

Businesses should take note of Nigeria and the projected trajectory of the market. With the huge population and youthfulness of the country, as the population gets older, purchase power will continue to increase, and businesses looking to expand can benefit from the powerful set of customers.

According to the Spectator Index, Nigeria can be named the second worst country in the world by power supply. Amongst the 137 countries, Nigeria was named the second after Yemen. According to the reports provided by the Electricity Generating Companies, the average power supply in Nigeria was 3,851 Megawatts in 2018, which is poor in comparison to South Africa which produces over 40,000 MW of power for over 56 million people. That being said, the extra cost of electricity is also an economic factor to consider in Nigeria. Due to the lack of constant electricity, Generators that run on fuel or diesel are being used as a source of electricity.

Social

Nigeria’s population is very young with an average age of 20 years. Over 60 million people in Nigeria are 14 years old or younger, which points to an even larger consumer market to come in the next decade. (Shannon McCroklin, 2018)

Nigeria has a high illiteracy rate, although according to Knoema.com Nigeria’s literacy rate has been increasing exponentially from 51.1% in 2008 to 59.6%, which will only continue to grow over the coming years.

Technological

Over the past few years, Nigerians have been becoming more and more computer savvy. A large number of Nigerians are computer literate, and the use of mobile devices and mobile apps has bridged the gap between computer literates and illiterates, especially with the invention of smartphones many people are now users of the internet and have active social media presence. According to Statista.com, the number of smartphone users in Nigeria has appreciated since 2014 and will continue to increase and the penetration of smartphones will continue to rise also to around 60% by 2025, which will inevitably increase the number of internet users. Therefore, businesses can use the Internet to sell products and target consumers.

Environmental

The government in Nigeria plays an important role in protecting the ecology of the country. Each territory is empowered to make laws that ensure environmental sanitation to prevent outbreaks of diseases or sickness.

Nigeria is a country that lacks electricity, this introduces a high level of noise pollution & air pollution from generators, this can have some negative effects on commercial and industrial areas &. Businesses.

SWOT Analysis

Strengths

    • Company Brand name
    • Data efficient company
    • Search Ads Advantage
    • Opportunities
    • Grow interested in Merchandise
    • Upper-middle-class buying power growing in Nigeria.
    • Low rivalry from existing competitors

Weaknesses

    • More affordable alternatives in the market
    • Low website traffic
    • No social media presence.
    • No conversions on the website.

Threats

    • Expanding beyond technologically sound areas.
    • Logistical problems, due to bad roads and poor power supply.

SMART Objectives

The SWOT analysis lays a foundation on which SMART objectives can be formed. Using the smart Framework ensures that objectives are specific, measurable, achievable, realistic, and time-bound. In setting up smart objectives, data collected from the Situation analysis will be used to identify these objectives and solve them.

Setting a budget to achieve all objectives and breaking down each individual and the collective effort it will require without full insight into internal revenues and the marketing budget of the business is not practical and feasible. However, the objectives are listed below.

Objectives set as part of the digital marketing strategy are:

    • Increase website traffic by 300% within the next months.
    • Grow 3000 followers/likes on Facebook, Instagram, and Twitter within the next three months.
    • Bring 1000 new signed-up customers on the website within the next six months.

Objectives

Substantiation

Grow 3000 followers/likes on Facebook, Instagram, and Twitter within the next three months.

Having a social media account is very important for businesses, it creates a path for 2-way communication between the business and the buyer persona. Building a social platform will also help brand awareness and can eventually translate into sales conversions for the company.

    • Increase website traffic by 300% within the next months.
    • Situation analysis showed that traffic on the website is low.
    • Bring 1000 new signed-up customers on the website within the next six months
    • More signed-up customers translate to more likely conversions, which translates to more robust business.
    • The objectives in the above table translate into short, medium- and long-term plans that will support the IMC strategy.

Strategy

The table below shows all the objectives and strategies that will be in place and the Key Performance Indicators (KPIs) that will be needed to make sure that the objectives are met.

Objectives

Strategies

KPIs

    • Grow 3000 followers/likes on Facebook, Instagram, and Twitter within the next three months.
    • Create social media accounts and promote social media accounts, and create engaging and interactive content specific to platforms.
    • An overall number of followers, likes, comments, views, and retweets on different platforms.
    • Increase website traffic by 300% within the next 6 months.
    • Bring 1000 new signed-up customers on the website within the next six months.

Tactics

Before outlining the tactics, it is important to consider how the marketing mix will influence this strategy.

    • Product: The company provides branded merchandise to customers; the business has to offer the best quality products in order to remain relevant in the market.
    • Price:
    • Place: Management and promotion of the business takes place online, because of the nature of the business & brand.
    • Promotion: Multiple channels online will be utilized to promote the business, like social media platforms, search ads, email marketing, and the like.

Social Media Marketing

Build social media platforms (Facebook, Instagram, Twitter), use social media influencers, user-generated content, Twitter polls, trend hijacking, and short videos.

Native Advertising

By collaborating with popular fashion blogs and other relevant blogs. Google merchandise store can expand its reachability and generate more traffic to its website.

Paid Advertising

In order to reach a wider range of audience, search and display ads will be utilized appropriately to reach its conversion goal.

Email Marketing

This tactic will be used to inform customers about deals and great sales, it will also be used to remind customers where to get quality products and to re-engage disconnected customers.

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Google Business Strategy: Critical Essay. (2023, October 27). Edubirdie. Retrieved June 23, 2024, from https://edubirdie.com/examples/google-business-strategy-critical-essay/
“Google Business Strategy: Critical Essay.” Edubirdie, 27 Oct. 2023, edubirdie.com/examples/google-business-strategy-critical-essay/
Google Business Strategy: Critical Essay. [online]. Available at: <https://edubirdie.com/examples/google-business-strategy-critical-essay/> [Accessed 23 Jun. 2024].
Google Business Strategy: Critical Essay [Internet]. Edubirdie. 2023 Oct 27 [cited 2024 Jun 23]. Available from: https://edubirdie.com/examples/google-business-strategy-critical-essay/
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