Should Google Fear Amazon More than Facebook?

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By Jacob Maslow

Google website on a macbook
Man sitting with a Macbook Retina with Google Site

Facebook (NASDAQ:FB) can put a lot of fear into Google (NASDAQ:GOOG). Based solely on content consumption and dwell time, consumers prefer Facebook more than Google. This makes a lot of sense. In fact, it is not a surprise at all. When you go to Google, you go there for a specific reason: you are looking for information. Your level of engagement with Google itself ends once Google shows a list of results and you click through. When you click through, you end up at a totally different website

Google’s engagement levels tend to be shallow but highly targeted. This is completely opposite of what happens on Facebook. On Facebook, there is not much targeting because you just want to look at the updates that your friends post. You casually look through their shares, and when you find something mildly amusing or interesting, you click through. After the window opens and you check out that content, you come back to Facebook. Naturally, the time you spend on Facebook is much longer on Facebook. However, there is not much targeting, in terms of the content you are consuming.

Google has looked at this as a threat because of the huge amount of time Facebook is sucking up. In fact, there had been rumors that Facebook would roll out a search engine that would rival Google’s. If this happens, then it would probably be the battle royale of the technology space.

However, the one company that really should give Google sleepless nights is not Facebook. With all of Facebook’s customer loyalty and content consumption patterns, the real danger to Google is Amazon’s innovative personality. What drives Amazon is a relentless pursuit of value. Amazon looks to nail e-commerce and online sales down. This is a serious threat to Google because Google is really just an advertising shell disguised as a search engine. If you take out the advertising portion of Google, Google doesn’t have a business.

Amazon (NASDAQ:AMZN), on the other hand, exists on its own. People go to Amazon to buy stuff. Amazon is the destination. Google is simply looking to be a middleman of information. See the difference? Since Amazon has a huge cash pile and is constantly innovating, Google should fear Amazon more than Facebook. One key area that Amazon competitors should be mindful of is Amazon’s foray into cloud computing. Amazon Web Services is fast shaping up to be the 800 pound gorilla of key segments of the cloud-computing market.

Facebook and Google might be battling each other on content consumption, issues, and advertising models. But all that would be moot if they let Amazon get out from under them. If you are looking for a company that has a high chance of breaking out in the big way in the future, check out Amazon. You might just be surprised.

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