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Saturday, September 04, 2004

Google: Ultimate Demand Generator by David Meier Via Fool.Com

Google is in the demand-generating business. It is essentially a sales channel to the Internet. Google's purpose is not to get you to a website. It wants to get you to your solution. And along the way, it generates demand directly, using AdWords and Froogle, or indirectly, using AdSense. These very specialized actions prevent Google from being a portalA portal is defined as "a website considered as an entry point to other websites, often by being or providing access to a search engine." Using this definition, you could define Google as a portal. But a portal also conjures up images of stepping into the vast unknown that is the Internet.David raises the question, "should google offer online services" and firmly says, no.You can go to eBay (Nasdaq: EBAY) to hook up with sellers and purchase it through an auction. Or, you could use Froogle to search for the best deals throughout the entire Internet.
If Froogle could consistently find the best deals and bring customers with pent-up demand to suppliers, doesn't everyone win? Could eBay get disintermediated by search technology because suppliers would only have to pay for clicks that get through to their sites? I think it's possible. In fact, it's exactly what Google wants.
This article titled "Owning the Standard for Search Engines." explains this idea in detail. David concludes by saying,"Using search technology to generate demand is Google's unique position. There's no way Google should settle for being a portal. ".

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