2017-18

SCHOOL OF BUSINESS STUDIES

SALES AND DISTRIBUTION MANAGEMENT

TOPIC- GOOGLE

SUBMITTED TO-: SUBMITTED BY-:

VIJENDRA DHYANI HIMANSHI AGARWAL

2015012445
BBA (3RD YEAR)
 GOOGLE

Google LLC[5] is an American multinational technology company that specializes in Internet-

related services and products, which include online advertising technologies, search engine,
cloud computing, software, and hardware. Google was founded in 1998 by Larry
Page and Sergey Brin while they were Ph.D. students at Stanford University, California.
Together, they own about 14 percent of its shares and control 56 percent of the stockholder
voting power through supervoting stock. They incorporated Google as a privately held company
on September 4, 1998. An Initial public offering (IPO) took place on August 19, 2004, and
Google moved to its new headquarters in Mountain View, California, nicknamed
the Googleplex. In August 2015, Google announced plans to reorganize its various interests as a
conglomerate called Alphabet Inc. Google, Alphabet's leading subsidiary, will continue to be the
umbrella company for Alphabet's Internet interests. Upon completion of the restructure, Sundar
Pichai was appointed CEO of Google, replacing Larry Page, who became the CEO of Alphabet.
The company's rapid growth since incorporation has triggered a chain of products, acquisitions,
and partnerships beyond Google's core search engine (Google Search). It offers services
designed for work and productivity (Google Docs, Sheets, and Slides), email (Gmail/Inbox),
scheduling and time management (Google Calendar), cloud storage (Google Drive), social
networking (Google+), instant messaging and video chat (Google Allo/Duo/Hangouts), language
translation (Google Translate), mapping and turn-by-turn navigation (Google
Maps/Waze/Earth/Street View), video sharing (YouTube), note-taking (Google Keep), and photo
organizing and editing (Google Photos). The company leads the development of
the Android mobile operating system, the Google Chrome web browser, and Chrome OS, a
lightweight operating system based on the Chrome browser. Google has moved increasingly into
hardware; from 2010 to 2015, it partnered with major electronics manufacturers in the
production of its Nexus devices, and in October 2016, it released multiple hardware products
(including the Google Pixel smartphone, Home smart speaker, Wifi mesh wireless router,
and Daydream View virtual reality headset). The new hardware chief, Rick Osterloh, stated: "a
lot of the innovation that we want to do now ends up requiring controlling the end-to-end user
experience". Google has also experimented with becoming an Internet carrier. In February 2010,
it announced Google Fiber, a fiber-optic infrastructure that was installed in Kansas City; in April
2015, it launched Project Fi in the United States, combining Wi-Fi and cellular networks from
different providers; and in 2016, it announced the Google Station initiative to make public Wi-Fi
available around the world, with initial deployment in India.
Annual revenue of Google from 2002 to 2017 (in billion U.S.
dollars)
Alphabet’s profit beat Wall Street estimates and rose 29 percent to $5.43 billion, a performance
that analysts called exceptional for a company so large. Shares of the company rose 2.8 percent
to $916.80. Google's revenue rose 22.2 percent to $24.75 billion from $20.26 billion in the
quarter ended March 31’17. Net income rose to $5.43 billion, or $7.73 per share, from $4.21
billion, or $6.02 per share.

Looking at Google's total revenue in 2017, the company generated $110.9 billion – an increase
of 23% compared to its total earnings in 2016. As for Q4 alone, revenues of $32.3 billion
allowed for a year-over-year increase of 24% compared to Q4 2016. Also, of that $32.3 billion in
quarterly revenue, a whopping $27.27 billion came from ad revenue.

Most prominent product of Google to its sales are –:

1) Digital advertising
-Moblie Adversting
2) Play store
3) Google Pixel 2 Smartphone
Digital advertising-:
Google will maintain its dominance and account for 40.7% of US digital ad revenues in 2017—
more than double Facebook’s share. eMarketer expects Google’s share of the search market to
grow 16.1% to $28.55 billion in 2017.Paid clicks, where an advertiser pays only if a user clicks
on ads, rose 44 percent.

Mobile advertising-:
. “Google’s dominance in search, especially mobile search, is largely
coming from the growing tendency of consumers to turn to their
smartphones to look up everything from the details of a product to
directions,” said eMarketer forecasting analyst Monica Peart. “Google
and mobile search as a whole will continue to benefit from this
behavioral shift.”Google has aggressively shifted the focus of its business to
mobile advertising. Google is expected to command a 61.6 percent share of the
search ad market worldwide in 2017, up from 60.6 percent in 2016, according to
research firm eMarketer. Mobile ads command lower prices than desktop ads, but
growing volume is more than making up the difference.

Prominent product mobile advertising-:

Great properties -- like Search, Maps, YouTube and Google Play -- are the ‘prime time’ for the
mobile world, where people are actively engaged and interested,”
Google’s non-advertising revenue, which consists mainly of the cloud computing business,
the Pixel smartphones and the Play store, also grew dramatically in the quarter, jumping
49.4 percent to $3.10 billion. Google hardware sales and Play Store revenue are way up
year-over-year.

Play store-:

Digital sales of apps and content in our Play store drove the year-over-year growth.Google Play
struggled to keep up with Apple's App Store in the beginning, but it quickly grew into a
formidable opponent as more and more developers began creating apps for Android. According
to a report by app analytics company App Annie, global downloads and revenue increased for
Play from 2013 to 2014, fueled primarily by games and apps built on the freemium model. All
this growth is good news for developers

The last quarter of 2016 saw astonishing sales growth of 84 percent compared to the same
quarter of 2015. The total revenue rose from $1.8 billion to $3.3 billion, which is still short
compared to Apple’s $5.4 billion in revenue (up from $3.4 billion last year) but respectable in
its own right. As a result, the overall market grew by 67 percent.
Google pixel-:

Google's hardware sales – such as the Pixel 2 and 2 XL, Home Mini, etc. – are grouped under a
category called "Other Revenues.
" Morgan Stanley has estimated that Google's new smartphone, the Pixel , will generate $3.8
billion in revenue for the company in 2017.
The estimate is based on the expectation that Google will sell around 5-6 million Pixels next
year, which retail between $649 and $869.
The bank also projected that Google will sell 3 million Pixels in the last three months of 2016,
generating $2 billion. The Morgan Stanley note also estimates the Pixel will be half as profitable
for Google as the iPhone is to Apple The Pixel phone will generate a 22%-25% gross profit
margin varying according to the model

Features unique to the Pixel, such as the Google Assistant , the Pixel camera ,
and Daydream (Google's virtual reality headset, which works with the Pixel), plus the
smartphone's deeper app integration, increased prominence of Android Pay, and improved
computing power (compared to other Android devices), will ultimately lead to users spending
more money on Android, according to the research note.