For centuries and most of the decades of the 20th century (that is, when the computer was invented) access and communication were the tool of the rich and ultra-rich, prohibitively expansive for the “not-so-rich” people. and “nothing rich”. All marketing research and development focused on 20% of the market based on the 80:20 management principle, ignoring the huge 4 billion people at the base of the pyramid (read Fortune at the Bottom of Pyramid by CK Prahalad, Wharton Publishing).
In the 1990s, the Internet appeared and changed the paradigm of the entire global market. Because here we have a great “Internet” tool, very efficient, very powerful to penetrate the impregnable market that was previously thought. For most, if the moment is the exposure to the outside world and the information is necessary to make any decision and growth of any sector of society or part of the world. The Internet is playing that role very efficiently.
The Internet is a mass product. Here power is in the hands of individuals, rich or not so rich (this terminology was taken from Fortune at the Bottom of Pyramid by CK Prahalad, Wharton Publishing).
General theory of market states
(i) The high-end market is driven by value.
(ii) The end market is driven by volume.
Through these two anomalies, we can clearly recognize that internet companies are focusing on the second approach and that is what CK Prahalad calls the base of the pyramid (BOP) approach in his innovation book Fortune at the Bottom of Pyramid.
I can give a great list of these companies, but, for example, take a few bright stars from today’s internet economy.
(i) ebay.com
(ii) aol.com
(iii) clickbank.com
(iv) Google.com
We will study the mother of all Google search engines and their approach to the base of the pyramid.
Let’s compare Google’s strategy and its giant competitors (well, not today, but in Google’s formative days when it mattered most). Google is a search engine based on the pay-per-click (PPC) approach to the internet economy. In formative days, Google did exactly what others thought and the gurus well recognized that the model is not viable and Google will be doomed to the graveyard.
Most of the dot-com or brick-and-mortar businesses on the Internet made money from advertising. They charge for the advertising space that they provide to the advertiser and they charge them for a certain duration and also all these only prepaid. This approach was already imminently followed in television advertising and, to some extent, was very successful. Advertisers had no options. For them it was a dark space to jump into. They had no control even after paying a hefty sum for network space.
See the other side of the coin. The consumer (technically visitor) was not part of the revolution. Even if they were, they were only used to generate huge profits for companies that operate on the Web.
Google entered the foray with a refreshing style and a very uncommon approach in the market.
1. There are no images on your home page. (There is an option available on other pages, but it is not very popular).
2. Tools and services for ordinary people.
3. Free for everyone (even sometimes for advertisers)
Do you see where the money is? I guess 90% would see none or many.
Google spread its wings online through word of mouth marketing and by keeping an intense focus on ordinary people who use the Internet. In the process, Google developed its own revenue-generating and marketing model with the empowerment of ordinary people, who love Google (I may be one of them).
(i) Google AdSense
(ii) Google AdWords
(iii) Froogle (similar to ebay.com but free for everyone).
(iv) Google Search
By delving into Google’s strategy and network economics approach, we can define two things.
(1) Focus on ordinary people in large volume in terms of purchasing power
(2) In the process, put more control in their hands, empower them to generate more purchasing power and habits to help themselves and the industry.
See two lower-level examples.
(1) Jon Gales, the owner of http://www.mobiletracker.net makes about $ 5000 per month just using Google Adsense. Notice, he’s just a happy, lucky 19-year-old boy.
(2) For small people who want to generate more sales for their small business, use Google AdWords and Froogle. Even if they don’t have any commercial products, they can sell someone else’s product and have good money in exchange for working for someone else in their own home.
Does it make a business commercially viable? Do not ask me. Look.
Seth Gobin, a well-known online advertising consultant and former Yahoo employee, used to have doubts about Google’s perspective. No longer “They have created the first new and effective advertising medium in the last 50 years. It’s brilliant, ”he says.
Napolean Hill, author of the State of the Law of Success in his book, “No man can achieve fame and fortune without taking others with him. It just can’t be done. “
It takes hard and continuous work with a great series of innovations in product design, process innovation and marketing, and a long period to get (in a mature economy or market) where Google is today.
Google 6 years $ 321mn
EBay 9 year $ 322mn
Yahoo 10 years $ 260mn
Amazon 9 year $ 114mn
In his book “Fortune at the Bottom of the Pyramid”, CK Prahalad state, “… .. what is needed is a better approach to helping the poor, an approach that involves partnering with them to innovate and achieve sustainable scenarios of mutual benefit where the poor are actively involved and, at the same time, the companies that provide them with products and services are profitable. “
I accept that ordinary people on the net are not poor. But see the deep meaning of CK Prahalad’s statement, ”- …… where the poor are actively engaged and at the same time ……… ..”. That is the e-commerce model that I am talking about. They are not poor, but they are active and willing to change their buying behavior. The change in buying behavior is the most impressive milestone that can still be reached in e-commerce to really get the internet economy off the ground. According to Napolean Hill, you need to help ordinary people on the Internet see what the Internet can do for them.
Gil Penchina, Vice President of State for eBay International, “It’s about getting more people to access the (eBay) system. People on the web follow a very simple system. They go online most of the time because they want email, then they start reading news, and then they shop. Once they value purchases, they shop repeatedly. That’s when they realize they can sell too. “
By actively involving ordinary people, they will gain more confidence in e-commerce. To achieve this astonishing rate of growth, the e-commerce community has to embrace the “inclusive capitalism” approach. Ordinary Internet people must have a great opportunity to take advantage of the incredible great opportunity of the Internet. According to CK Prahalad, leveraging the “Trust is a prerequisite” BOP segment. Large or small companies need to build this bridge of trust to access this high-volume market segment.
In Google’s case, it is famous for its unconventional approach and infamously trusted for the unorthodox management approach of its founders Lary Page and Sergey Brin. Google just doesn’t understand integrity for profit in their search results. Your user can always trust Google for its integrity to receive Google’s full support for their small or large business.
Am I madly in love with Google? Believe me, I am not alone.
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You can access the same article on the Nuttymarketer.com website at:
[http://www.nuttymarketer.com/green/gorilla_marketing_ecommerce1.htm]
This research work for this report was carried out by Mr. Arvind Kumar, founder of www.Nuttymarketer.com. He can be reached at [email protected].