World: Media Analysis - Can Google sustain its brand expansion after public sale?

The planned IPO may be at odds with its anti-corporate image, Philip Smith argues.

If eBay and Amazon were the standard-bearers of the original dotcom boom, Google is the brand that is held up as the internet's ultimate success story.

Despite having to slash its share-price in the run-up to its IPO, the search engine has come to represent not only a successful internet brand that puts the user's experience at the heart of its plans, but one that is not prepared to follow a conventional route to growth.

Typically for a company that has built a Klingon-language interface of its search engine (it has content in 35 non-English languages), even the brand's IPO is being run differently. Its online auction was seen as a way of guaranteeing its users a piece of the action.

"I think they are going about it the right way," Steve Pankhurst, the co-founder of another successful dotcom, the UK-based Friends Reunited, says.

Friends Reunited considered the possibility of selling off its website and business. However, Pankhurst and his co-founders decided to bring in a new management team because they felt they could be trusted to respect the original brand and its values.

Google's founders, the former Stanford University students Larry Page and Sergey Brin, seem to have a similar outlook.

"I like the fact that they are almost anti-big institutions. They are going to IPO with an online auction and that is different," Pankhurst remarks.

The core of Google's search service - and the heart of its success - is the algorithm that organises its search results. This was developed in-house. Google's major revenues come from sponsored search results and by letting advertisers buy Google "AdWords", which appear alongside the natural, non-commercial results.

But the business goes way beyond a mere search engine -Google has produced a range of brand extensions and services.

Andy Hobsbawm, the European managing director of Agency.com and itraffic, which handle British Airways' digital work, believes innovation is key for successful digital brands and that Google's success shows this.

"Google has set itself up as a technology platform - like an operating system - from which it can launch new products and services," he says.

Gmail, a free e-mail service that users access in return for viewing ads, has the highest profile, but Froogle, Google's shopping comparison service, currently only available in the US, has brought the business into a competitive area of the internet. The portal Yahoo! bought the rival shopping comparison service Kelkoo for £318 million earlier this year, demonstrating the value of the brand.

Google also has a news aggregation service, which is in a beta (live, but testing) stage. And, Orkut, a social networking service, launched in late 2003.

Orkut was the result of a Google policy where all employees are allowed to spend 20 per cent of their time working on personal interests, to encourage creativity.

"But it is systemised innovation," Hobsbawm says. "They are rigorous about choosing only services that have commercial value."

Adam Freeman, the commercial director at Guardian Unlimited, says it is easier in a digital business to innovate for innovation's sake.

"We've learned at The Guardian that you have to be very clear about the benefits of innovation but that you also have to bet on a range of ideas. The question is, how much do you bet on each?"

Yet, for a business that places a premium on home-grown ideas and innovation, Google is unafraid to spend on acquisition. In early 2003, Google bought Blogger.com, which helps millions of people set up their own weblogs or blogs - personal online diaries.

It has also invested in businesses to give it new geographical scope.

In June, Google confirmed that it had bought into Baidu.com, a search engine based in Beijing. Baidu was founded in 1999 and claims to have the world's largest Chinese web-page index of more than 300 million pages.

However, those who suggest that Google will enter a new world post-IPO will need to think again. For a start, the IPO will bring pressure to develop new revenue streams. Some commentators, including notably the Financial Times' Lex column, have been critical about what they perceive as a lack of strategy for growing the business.

But what impact will the IPO have on Google's own brand? The limited access that the public has to Gmail has illustrated a key point about its "brand-of-the-people" image - a lot of internet users see Google as anti-corporate. The white space on its homepage and the absence of advertising clutter are key to this. This association has gone so far that the mini-market that was set up around Gmail accounts and services involved a barter system. People felt Google's products should not be bought and sold like items on eBay.

"But, of course, there is going to be a change in how people perceive the brand after the IPO," Pankhurst says. "Then there always is change; in four or five years people will have forgotten what it was like initially."

GOOGLE FACTS

Launch date: Google was launched in 1998 by Larry Page and Sergey Brin.

The two developed the approach while studying at Stanford University.

Landmarks

March 2003: More than 100,000 active advertisers have signed up for

Google AdWords.

February 2004: Google's index hits 4.28 million web pages.

Acquisitions

2003: Google buys Pyra Labs which owns Blogger.com, giving it access to

the software that allows individuals to run weblogs online and a whole

new source of search content.

Brand extensions

Google News launched a beta-version in September 2002, with access to

4,500 global news sources.

Froogle, a shopping- comparison service, launched in the US in December

2002.

Gmail, which offers free mail accounts, was announced on 1 April, 2004.

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