Why Google Is Like Wal-Mart
Why Google Is Like Wal-Mart
By Adam L. Penenberg Also by this reporter
02:00 AM Apr, 21, 2005
Why Google Is Like Wal-Mart One is an internet search powerhouse, the other a massive retailer. They have more in common than you might think.
Commentary by Adam L. Penenberg.
On one hand, you have a company that rose up from modest beginnings to become one of the richest businesses in America (indeed, the world), and in the process revolutionized the use of technology to create a new way to do business -- helping people find what they want.
And then you have Google.
It turns out that Wal-Mart, the world's most profitable retailer, and Google, the virtual world's most profitable search seller, have a lot more in common than you might think.
Founders:
• Wal-Mart: Sam Walton (1918 - 1992), who personified "middle America."
• Google: Larry Page and Sergey Brin, who personify geek America.
Company slogan:
• Wal-Mart: "Always low prices!"
• Google: "Don't be evil."
Alternative slogan:
• Wal-Mart: "Always low wages."
• Google: "Maybe not evil, but after the IPO not so good either."
Market cap:
• Wal-Mart: $202 billion (not bad for a company that peddles cheap goods imported from China).
• Google: $55 billion (not bad for a company that doesn't actually make anything).
Reach:
• Wal-Mart: Accounts for almost 9 percent of all retail sales in the United States.
• Google: Accounts for almost four out of five internet searches (which includes sites that license Google's search technology), and 75 percent of all referrals to websites.
Secrets to success:
• Wal-Mart: Revolutionized the retail industry by offering a wider variety of products (at lower prices) than competitors in a clean, customer-friendly environment.
• Google: Revolutionized the search engine industry by offering faster, more useful searches (for free) than competitors on a clean, user-friendly website.
Key moment in company's history:
• Wal-Mart: 1988, when it opened up its first Supercenter in Washington, Missouri, thereby giving new meaning to the term "one-stop shopping."
• Google: 2000, when, following Yahoo's lead, it began selling advertisements based on keywords, giving new emphasis to the term "relevancy."
In-house technology:
• Wal-Mart: Developed information technology (it operates the nation's largest private satellite communication system) and perfected the use of the bar code to speed up the supply chain so that both Wal-Mart and the vendor know exactly how many blenders, brooms and baseball gloves they have sold, and how many need to be delivered to specific stores.
• Google: Developed algorithms to rank web pages by link popularity so that searches are not only fast, but also yield the most useful results.
Company jargon:
• Wal-Mart: Refers to workers as "associates" and managers as "servant leaders."
• Google: Refers to AdSense users as "affiliates" and discourages individual employees from communicating with outsiders, preferring all correspondence come from Google "team" members.
Company maxims:
• Wal-Mart: Sam Walton compiled a list of 10 items that form the company's core philosophy, including, "Exceed your customers' expectations," "Commit to your business," "Communicate everything you possibly can to your partners," "Control your expenses better than your competition" and "Swim upstream."
• Google: Brin and Page compiled a list of 10 items that form the company's core philosophy, which include, "Focus on the user and all else will follow," "You can make money without doing evil," "The need for information crosses all borders," "You can be serious without wearing a suit" and "Great just isn't good enough."
Worker salaries:
• Wal-Mart: Pays about 20 percent less than competing retailers, with many employees earning minimum wage and ineligible for health benefits.
• Google: Pays less than other Silicon Valley tech companies. A system administrator earns around $35,000, which in the San Francisco Bay Area, with its astronomical housing prices and cost of living, might as well be minimum wage.
Archenemies:
• Wal-Mart: Unions; community organizers dead set against Wal-Mart setting up shop in their towns; government investigators looking into the use of illegal immigrants at below minimum wage, the practice of locking employees inside stores past store hours, and shaving labor costs by forcing workers to work off the clock; the media.
• Google: Privacy experts, who are spooked by the company's long-lasting cookie (which will expire in the year 2038 and can track a user's search terms) and by Gmail, which scans e-mail to target ads based on messages' content; unethical search engine optimization companies, which constantly find ways to rig search results; the media.
Biggest threat:
• Wal-Mart: Falling dollar and rising yuan, which could make Chinese imports more expensive and potentially shave profit margins.
• Google: Click fraud, which would undermine advertisers' faith in Google's ad programs and force the company to refund millions of dollars, which could potentially shave profit margins.
Quote the company most regrets:
• Wal-Mart: "I pay low wages. I can take advantage of that. We're going to be successful, but the basis is a very low-wage, low-benefit model of employment." -- Sam Walton
• Google: "Evil is whatever Sergey says is evil." -- Google CEO Eric Schmidt. Runner-up: "We are moving to a Google that knows more about you." -- Schmidt
Allegations of censorship:
• Wal-Mart: Won't stock magazines with racy material (Maxim, FHM and Stuff) and partially conceals the covers of certain women's magazines; won't carry music albums with explicit or profane lyrics, or albums that contain lyrics critical of Wal-Mart. (One famous example: In 1996, Wal-Mart refused to sell a Sheryl Crow CD containing lyrics that heaped scorn on the company for selling guns.)
• Google: Blocks users in Germany, France and Switzerland from accessing sites that contain potentially racist content or hate speech. Amended terms and conditions to bar criticism of the company's AdSense service terms and conditions. Allows advertising for beer and wine but not for hard liquor, and won't accept ads for guns. Amended AdSense policy so that affiliates are barred from criticizing Google on their sites.
- - -
Adam L. Penenberg is an assistant professor at New York University and the assistant director of the business and economic reporting program in the school's department of journalism.
--------------------------------------------------------------------------------
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Your use of this website constitutes acceptance of the Lycos Privacy Policy and Terms & Conditions
By Adam L. Penenberg Also by this reporter
02:00 AM Apr, 21, 2005
Why Google Is Like Wal-Mart One is an internet search powerhouse, the other a massive retailer. They have more in common than you might think.
Commentary by Adam L. Penenberg.
On one hand, you have a company that rose up from modest beginnings to become one of the richest businesses in America (indeed, the world), and in the process revolutionized the use of technology to create a new way to do business -- helping people find what they want.
And then you have Google.
It turns out that Wal-Mart, the world's most profitable retailer, and Google, the virtual world's most profitable search seller, have a lot more in common than you might think.
Founders:
• Wal-Mart: Sam Walton (1918 - 1992), who personified "middle America."
• Google: Larry Page and Sergey Brin, who personify geek America.
Company slogan:
• Wal-Mart: "Always low prices!"
• Google: "Don't be evil."
Alternative slogan:
• Wal-Mart: "Always low wages."
• Google: "Maybe not evil, but after the IPO not so good either."
Market cap:
• Wal-Mart: $202 billion (not bad for a company that peddles cheap goods imported from China).
• Google: $55 billion (not bad for a company that doesn't actually make anything).
Reach:
• Wal-Mart: Accounts for almost 9 percent of all retail sales in the United States.
• Google: Accounts for almost four out of five internet searches (which includes sites that license Google's search technology), and 75 percent of all referrals to websites.
Secrets to success:
• Wal-Mart: Revolutionized the retail industry by offering a wider variety of products (at lower prices) than competitors in a clean, customer-friendly environment.
• Google: Revolutionized the search engine industry by offering faster, more useful searches (for free) than competitors on a clean, user-friendly website.
Key moment in company's history:
• Wal-Mart: 1988, when it opened up its first Supercenter in Washington, Missouri, thereby giving new meaning to the term "one-stop shopping."
• Google: 2000, when, following Yahoo's lead, it began selling advertisements based on keywords, giving new emphasis to the term "relevancy."
In-house technology:
• Wal-Mart: Developed information technology (it operates the nation's largest private satellite communication system) and perfected the use of the bar code to speed up the supply chain so that both Wal-Mart and the vendor know exactly how many blenders, brooms and baseball gloves they have sold, and how many need to be delivered to specific stores.
• Google: Developed algorithms to rank web pages by link popularity so that searches are not only fast, but also yield the most useful results.
Company jargon:
• Wal-Mart: Refers to workers as "associates" and managers as "servant leaders."
• Google: Refers to AdSense users as "affiliates" and discourages individual employees from communicating with outsiders, preferring all correspondence come from Google "team" members.
Company maxims:
• Wal-Mart: Sam Walton compiled a list of 10 items that form the company's core philosophy, including, "Exceed your customers' expectations," "Commit to your business," "Communicate everything you possibly can to your partners," "Control your expenses better than your competition" and "Swim upstream."
• Google: Brin and Page compiled a list of 10 items that form the company's core philosophy, which include, "Focus on the user and all else will follow," "You can make money without doing evil," "The need for information crosses all borders," "You can be serious without wearing a suit" and "Great just isn't good enough."
Worker salaries:
• Wal-Mart: Pays about 20 percent less than competing retailers, with many employees earning minimum wage and ineligible for health benefits.
• Google: Pays less than other Silicon Valley tech companies. A system administrator earns around $35,000, which in the San Francisco Bay Area, with its astronomical housing prices and cost of living, might as well be minimum wage.
Archenemies:
• Wal-Mart: Unions; community organizers dead set against Wal-Mart setting up shop in their towns; government investigators looking into the use of illegal immigrants at below minimum wage, the practice of locking employees inside stores past store hours, and shaving labor costs by forcing workers to work off the clock; the media.
• Google: Privacy experts, who are spooked by the company's long-lasting cookie (which will expire in the year 2038 and can track a user's search terms) and by Gmail, which scans e-mail to target ads based on messages' content; unethical search engine optimization companies, which constantly find ways to rig search results; the media.
Biggest threat:
• Wal-Mart: Falling dollar and rising yuan, which could make Chinese imports more expensive and potentially shave profit margins.
• Google: Click fraud, which would undermine advertisers' faith in Google's ad programs and force the company to refund millions of dollars, which could potentially shave profit margins.
Quote the company most regrets:
• Wal-Mart: "I pay low wages. I can take advantage of that. We're going to be successful, but the basis is a very low-wage, low-benefit model of employment." -- Sam Walton
• Google: "Evil is whatever Sergey says is evil." -- Google CEO Eric Schmidt. Runner-up: "We are moving to a Google that knows more about you." -- Schmidt
Allegations of censorship:
• Wal-Mart: Won't stock magazines with racy material (Maxim, FHM and Stuff) and partially conceals the covers of certain women's magazines; won't carry music albums with explicit or profane lyrics, or albums that contain lyrics critical of Wal-Mart. (One famous example: In 1996, Wal-Mart refused to sell a Sheryl Crow CD containing lyrics that heaped scorn on the company for selling guns.)
• Google: Blocks users in Germany, France and Switzerland from accessing sites that contain potentially racist content or hate speech. Amended terms and conditions to bar criticism of the company's AdSense service terms and conditions. Allows advertising for beer and wine but not for hard liquor, and won't accept ads for guns. Amended AdSense policy so that affiliates are barred from criticizing Google on their sites.
- - -
Adam L. Penenberg is an assistant professor at New York University and the assistant director of the business and economic reporting program in the school's department of journalism.
--------------------------------------------------------------------------------
© Copyright 2006, Lycos, Inc. Lycos is a registered trademark of Lycos, Inc. All Rights Reserved.
Your use of this website constitutes acceptance of the Lycos Privacy Policy and Terms & Conditions
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