There is no doubt that Google is one of the most successful companies which emerged from the .COMs bubble burst in the late 90s.
Its business model proved itself to be effective and viable and it was a pioneer in generating high revenues. Even well established online companies like Yahoo failed to see what Google was up to.
My own experience with Google main business model started when I developed a website for my wife to help her pass the hard pregnancy which forced her to stay in bed in the last months before delivery.
This site, www.simpleconnexion.com, was intended to be something SIMPLE to develop and EASY to use (you can guess the origin of the name).
The idea, which later I discovered that was not really new one, is to let people take a break from what they are doing and have a little chat for 5 to 10 minutes with people chosen randomly by the site itself. It is a way of distraction and fun.
The initial version took one night to finish, and since the host gave us free Google AdWords and Facebook Ads I decided to get use of these two offers.
So I put the same advertisement on the two sites that says “Chat with random people from all over the world” and waited.
In just few hours the Google AdWords’ offered credits were consumed while the credits offered for Facebook Ads took two days.
At the end, I checked the data and the difference were flagrant. The Click Through Rate (CTR) for Google was 0.65% while the one of Facebook was 0.018%! Which means an amazing 36 times efficiency in favor of Google.
To explain this difference one should look on how both sites proceed. Google is able to directly detect users’ instant needs and respond to it by displaying the appropriate ads, while facebook uses users profile to guess their needs and show them the ads.
Its business model proved itself to be effective and viable and it was a pioneer in generating high revenues. Even well established online companies like Yahoo failed to see what Google was up to.
My own experience with Google main business model started when I developed a website for my wife to help her pass the hard pregnancy which forced her to stay in bed in the last months before delivery.
This site, www.simpleconnexion.com, was intended to be something SIMPLE to develop and EASY to use (you can guess the origin of the name).
The idea, which later I discovered that was not really new one, is to let people take a break from what they are doing and have a little chat for 5 to 10 minutes with people chosen randomly by the site itself. It is a way of distraction and fun.
The initial version took one night to finish, and since the host gave us free Google AdWords and Facebook Ads I decided to get use of these two offers.
So I put the same advertisement on the two sites that says “Chat with random people from all over the world” and waited.
In just few hours the Google AdWords’ offered credits were consumed while the credits offered for Facebook Ads took two days.
At the end, I checked the data and the difference were flagrant. The Click Through Rate (CTR) for Google was 0.65% while the one of Facebook was 0.018%! Which means an amazing 36 times efficiency in favor of Google.
To explain this difference one should look on how both sites proceed. Google is able to directly detect users’ instant needs and respond to it by displaying the appropriate ads, while facebook uses users profile to guess their needs and show them the ads.
I think we all agree that there is a substantial difference between knowing the need and guessing the need. Furthermore, knowing the users interests via their profiles does not mean they are currently looking for something, while detecting their search keywords will reveal with high accuracy what they are looking for and what they intend to do in coming few minutes or hours.
For this reason I believe that Google is sitting on a gold mine and won’t be easy for any other player in the market, namely Facebook, to dethrone it in the near future.
For this reason I believe that Google is sitting on a gold mine and won’t be easy for any other player in the market, namely Facebook, to dethrone it in the near future.
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