Competitive Advantage Case Study

Yahoo and Google: Fight for Dominance

OR

Abstract:

In July 2005, the search engine industry ratings showed that the number of searches on Google, the industry leader, had increased by 6%; where as that of Yahoo’s had increased by 9% on Q-to-Q basis. Though Google had 36% market share in Web search in 2004, Yahoo was catching up fast with 27% market share

Till 2004, Google had been the undisputed leader in the search engine industry. A wave of mergers, acquisitions, and personnel changes shook up this ever-volatile industry and Yahoo emerged as a threat to Google's dominance. Yahoo was a full fledged media and information company whereas Google was technology savvy and was known for its innovation led growth. With different strengths and philosophies, the two companies were competing aggressively in the same market

The case describes the growth strategies followed by both players. Google’s innovation driven growth strategy and Yahoo’s diversified business model to dominate the industry has been compared and contrasted. The case highlights the competitive advantages Yahoo and Google have in their respective areas. The case ends with a debate on who would rule the search industry

Pedagogical Objectives:

• To understand the search engine industry structure
• To discuss the competitive growth strategies followed by the market leader Google and the market challenger Yahoo
• To analyse the business models followed by both competitors and their core competencies
• To discuss the competitive advantages Google and Yahoo had over each other
• To debate on who will dominate the industry in future and what shape will the industry take

Keywords : Core Competency & Competitive Advantage Case Study; Innovation; Peripheral Vision; Diversification in related Industries; Challenging the Leader; Growth Strategies of an Innovator; Competitive Advantage; Search Engine Industry; Yahoo; Google; Search Engine Industry