Lec14_Google - IS and Business Integration: Google ISOM...

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Unformatted text preview: IS and Business Integration: Google ISOM 101, Spring 2011 Lecture 14 HKUST Business School Midterm Mean = 67 S.D. = 10 Max. = 87 80-90: 13% 70-80: 32% 60-70: 30% ISOM 101 Raymond G. Sin © 2 HKUST Business School Further Details on Group Project (1) Group project Project presentation (50% of project grade) Written report Hardcopy; double-spaced, 12pt Times New Roman 8-10 pages (including references and tables), or approx. 3000 words; print on BOTH sides Cover page should include title, group name, full member list (with full names and IDs) ISOM 101 Raymond G. Sin © 3 HKUST Business School Further Details on Group Project (2) The project should include the following sections: 1. *Executive summary (1 page) 2. Introduction and background (1 page) 3. Research method (1/2 page) 4. Data description (optional, 1/2 page) 5. Analyses and results (2 pages) 6. Conclusion (1-2 pages) 7. References ISOM 101 Raymond G. Sin © 4 HKUST Business School The Importance of Referencing Respect Intellectual Property Credibility and Clarity Avoid Plagiarism – paraphrasing vs. copying http://www.ust.hk/vpaao/integrity/student-4.html “presenting work which is not your own and originates from other sources as if it is your own” Tutorial on Information Literacy and Referencing http://library.ust.hk/serv/skills/infoliteracy.html Instructions and practice exercises for In-text referencing (direct quotes, paraphrasing, summary) ISOM 101 Raymond G. Sin © 5 HKUST Business School Overview What is the origin of search engines? What are the different types? Google – how does it work and what is the underlying business model? What makes Google so successful? 6 ISOM 101, Spring 09 Prof. R. G. Sin © HKUST Business School Search and Destroy Rejoice!! The idea of Internet search was perceived as “technical” and part of portal services Not a business strategy Not a sustainable competitive advantage Not a “necessity” Not a $$ generating tool But Google has demonstrated that search engines can be used as a business strategy and marketing tool e.g. ISOM 532 price-based priority listing, banner ads, toolbars, apps… Raymond G. Sin © 7 HKUST Business School Search Engines (1) Four types of search engines: 1. Human-organized search sites (e.g. Yahoo! in the past) Humans define the data relevance and categorize items in ways that are useful to you Similar idea as “searching under a specific category” (e.g. “Apple” as fruit vs. “Apple” as company) 2. Computer-created search sites (e.g. Google, Excite, WebCrawler) ISOM 532 “Spiders” crawl all over the web and send back reports to be collected and organized with little human intervention They “crawl” across many different Web sites at the same time Some spiders are more intelligent – Google’s search engine rank results of a search according to popularity as well as probability of matching Raymond G. Sin © 8 HKUST Business School Search Engines (2) Four types (cont’d): 3. Hybrid search sites (e.g. MSN Search, Ask Jeeves, Lycos) Use human organization supplemented by computercreated indexes Natural-language queries: e.g. “where can I find reliable teamates for the group project?” Who pioneered the use of natural-language queries? 4. Metasearch sites (e.g. MetaCrawler, Dogpile) Send query to several other search engines and compile the results ISOM 532 Raymond G. Sin © 9 HKUST Business School Search Engines (3) The birth of Yahoo! Two Stanford grad students (David Filo + Jerry Yang) created Yahoo! to keep track of their favorite sites The list grew very long and was broken into categories Categories became too large; subcategories and subsubcategories were created Eventually Yahoo! went public in April 1996 Yahoo! now uses submission method (human) as well as spider method (Overture) for their search engine ISOM 532 Raymond G. Sin © 10 HKUST Business School Googling for Revenues Co-founders: Sergey Brin and Larry Page 620% revenue growth in 2003, 92% in 2005 (compared to 40% in the entire market), 56% in 2007, 26% in Q4, 2010 Net income in Q4 (2005): $372 million (compared with $424 million that Cathay Pacific made in the whole year in 2005); Q4 (2010)? $2.54 billion!! Market value once exceeded $128 billion (>Coca-Cola and Cisco!) Now priced at approx. $583 a share (IPO@ $85) Derives ~99% of sales from simple text-based ads ISOM 532 Raymond G. Sin © 11 HKUST Business School How Google Works (1) 1. The Web crawler (Googlebot) finds and retrieves Web pages and passes them to Google’s indexer 3. The query processor compares the search query to the index and recommends the documents that it considers most relevant 2. The indexer indexes every word on each page and stores the resulting index, sorted alphabetically by search terms (like the index in a Sin © 12 Raymond G. book) HKUST Business School How Google Works (2) Technology behind it: PageRank a system for ranking web pages uses link structure as an indicator of an individual page's value i.e. interprets a link from page A to page B as a vote, by page A, for page B It also analyzes the page that casts the vote. Votes cast by pages that are themselves "important" weigh more heavily and help to make other pages "important.“ Quality, not just quantity, matters ISOM 532 Raymond G. Sin © 13 HKUST Business School How Google Works (3) Important, high-quality sites receive a higher PageRank (which Google remembers) Google combines PageRank with sophisticated textmatching techniques to find pages that are both important and relevant to the user’s search e.g. the position and size of the search terms within the page, proximity of the search terms to one another ISOM 532 Raymond G. Sin © 14 HKUST Business School How Google Works (4) Obviously, Google did not make $$ by providing free services to users AdWords allows advertisers to bid on common search terms They simply enter the keywords they want to bid and the max. amounts they want to pay per click, per day Google determines a price and a search ranking for those keywords based on the relative willingness to pay by advertisers bidding for the same terms ISOM 532 Raymond G. Sin © 15 HKUST Business School How Google Works (5) Whoever bids the most for a term appears at the highest position in a sponsored ad link Paid search is the “ultimate targeted advertising” (WHY?) e.g. “Vacation in Hawaii” vs. “vacation” Overall industry revenue from paid search surpassed banner ads ISOM 532 Raymond G. Sin © 16 Google – Implications of an Ultra Powerful Search Engine HKUST Business School Source: The New York Times HKUST Business School Google’s Impact on Business (1) “Beyond the top 15, you are logically nonexistent” Search Engine Optimization Objectives? Increase traffic, conversion rate, and eventually profit – even for offline firms of people look beyond the 5th listing on Google Search engine market increases by 30%/yr Implications? <50% ISOM 101 Raymond G. Sin © 19 HKUST Business School Google’s Impact on Business (2) Implications The cyber space is supposed to be free, open, and is supposed to be the ultimate free and efficient market Where small players can compete with big corporations The existence of an ultra powerful (and monopolistic) search engine like Google essentially creates an equivalent of a “real estate” market on the Internet ISOM 101 Why can MTR generate so much revenue from renting office/shop spaces from their shopping malls? Companies not getting a “prime location” on Google may go bankrupt Increasingly, firms care more about what “Google thinks” rather than what customers need Raymond G. Sin © 20 HKUST Business School Google’s Impact on Our Daily Lives (1) Google changes the way people eat/cook (online recipe, restaurant reviews and location), buy, entertain, date, make a living, make life decisions, and even (not) remember things 21 yr old with high school education making $60,000 per month purely from Google Reasons for his success? Good or bad? Risk? ISOM 101 Raymond G. Sin © 21 HKUST Business School Google’s Impact on Our Daily Lives (2) Wouldn’t it be great if we had one “ultimate encyclopedia” that contains all knowledge and information of the world at our fingertip? Risk? Censorship and information control? Democratic or monarchy? Will we have different points of view and contrasting theories and hypotheses in the future? “Google Government”, “Google Currency”, “Control the stock market”??? ISOM 101 Raymond G. Sin © 22 HKUST Business School Is Google “Perfect”? Privacy issues and information control Videos: Googleware Google Maps is Evil Illustration: http://maps.google.com/ ISOM 101 Raymond G. Sin © 23 HKUST Business School The Power of Google Maps ISOM 101 Raymond G. Sin © 24 ...
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This note was uploaded on 01/10/2012 for the course ISOM 101 taught by Professor Chanriki during the Spring '10 term at HKUST.

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