Baidu: Beating Google at Its Own GameBaidu
Baidu: Beating Google at Its Own Game
Competitive advantage and sustainability * 60% market share, double that of Google Inc. in China * First mover advantage- developed a search engine that provided information in local Chinese languages * Offers searches in Chinese * Focused solely on Chinese * Knowledge of Chinese language and culture * Algorithms are different and better suited * Direct sales forces of 3,000 people in 7 cities to better serve its customers and assist in the areas of payment and logistic infrastructure * Higher penetration of distributors than Google * Goal: “to provide the best way for people to find information”- avant-garde technology to the world’s most ancient and complex language * Provides a wide range of products and services * Consumer-to-consumer * Mobile search * 25% of its revenue from partner websites * “pay-for-placement”- companies bid for search-result placement based on relevant keywords * Google brought 2.6% stake in Baidu for $5 million * Later sold for $60 million * Strategic acquisitions of businesses, assets, and technologies * Hao123.com * Baidu and Google: * Search, community, other enhancements * Business model- selling ads tied to user searches * Revenues derived from online marketing activities, principally auction-based pay-for- performance search advertisements * Baidu.jp- to serve small to medium-sized enterprises doing business in Japan * Focus product development to meet the demands of Japanese users * Support of Chinese Government- not blocked by the “Great Wall of China”
Industries Involved
Internet information providers
Information technology
Online advertising
Software and computer services in the subset of internet
Major Competitors * Google Inc. * Yahoo!
Potential Competitors * Yandex *
Competitive advantage and sustainability * 60% market share, double that of Google Inc. in China * First mover advantage- developed a search engine that provided information in local Chinese languages * Offers searches in Chinese * Focused solely on Chinese * Knowledge of Chinese language and culture * Algorithms are different and better suited * Direct sales forces of 3,000 people in 7 cities to better serve its customers and assist in the areas of payment and logistic infrastructure * Higher penetration of distributors than Google * Goal: “to provide the best way for people to find information”- avant-garde technology to the world’s most ancient and complex language * Provides a wide range of products and services * Consumer-to-consumer * Mobile search * 25% of its revenue from partner websites * “pay-for-placement”- companies bid for search-result placement based on relevant keywords * Google brought 2.6% stake in Baidu for $5 million * Later sold for $60 million * Strategic acquisitions of businesses, assets, and technologies * Hao123.com * Baidu and Google: * Search, community, other enhancements * Business model- selling ads tied to user searches * Revenues derived from online marketing activities, principally auction-based pay-for- performance search advertisements * Baidu.jp- to serve small to medium-sized enterprises doing business in Japan * Focus product development to meet the demands of Japanese users * Support of Chinese Government- not blocked by the “Great Wall of China”
Industries Involved
Internet information providers
Information technology
Online advertising
Software and computer services in the subset of internet
Major Competitors * Google Inc. * Yahoo!
Potential Competitors * Yandex *