GOOGLE'S 4TH ACE

Sometime in 2008, Nikesh Arora, then the Head of Google European, Middle Eastern and African (EMEA) operations, ran into the famed marketing guru Philip Kotler at a seminar in Dubai. Kotler's 4Ps of marketing getting the product, pricing, placement and promotion right is considered a gospel for modern business.

Arora asked him a very fundamental, if not irreverent, question: What happens to the 4Ps principle if three out of the four Ps are zero? Google's products are free, the company doesn't advertise (at least didn't then) and there isn't any specific placement of its products. The only P Google has is the Product. Kotler apparently brushed aside the query.

If Kotler was flabbergasted at Arora's question, he isn't the only one. Google's single P formula to achieve the two most elusive Ps of business Popularity (75 per cent share of the Internet search) and Profits ($4.3 billion in 2008 at a margin of almost 30 per cent) has confounded many.

By Kushan Mitra

Sometime in 2008, Nikesh Arora, then the Head of Google European, Middle Eastern and African (EMEA) operations, ran into the famed marketing guru Philip Kotler at a seminar in Dubai. Kotler's 4Ps of marketing getting the product, pricing, placement and promotion right is considered a gospel for modern business.
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Arora asked him a very fundamental, if not irreverent, question: What happens to the 4Ps principle if three out of the four Ps are zero? Google's products are free, the company doesn't advertise (at least didn't then) and there isn't any specific placement of its products. The only P Google has is the Product. Kotler apparently brushed aside the query.

If Kotler was flabbergasted at Arora's question, he isn't the only one. Google's single P formula to achieve the two most elusive Ps of business Popularity (75 per cent share of the Internet search) and Profits ($4.3 billion in 2008 at a margin of almost 30 per cent) has confounded many.

Arora was perhaps the right person to tickle Kotler, for he is now the man in Google directly responsible for the mother of all Ps profits. After his success in making Europe a cornerstone of Google's business, Arora has recently been promoted as President, Global Sales Operations and Business Development. Incidentally, Google has only three "Presidents the other two are founders Larry Page and Sergey Brin. And here is the surprising bit: Arora has not been a Googler all his working life.

Rather, Arora is more of a journeyman unsurprising, given that he was brought up in an Indian Air Force family. He credits the Kendriya Vidyalaya system for his upbringing, even though he finished schooling at The Air Force School in New Delhi's Subroto Park. Electrical engineering at Institute of Technology, Benaras Hindu University, came next, essentially because he followed his best friend there. After that, he took up his only sales job before joining Google selling Wipro computers to the government. But that was only for a year, after which Arora went to the United States to study management and spent 10 years living in Boston as a student and a consultant.

Then, Arora says he got bored, quit his consultancy job and packed off to London where he set up his own firm offering advice to telecom companies among them Deutsche Telekom (DT), Germany's dominant telecom operator. His skills were appreciated and the management at DT asked him to help set up marketing for their newly formed T-Mobile division.

For six years, Arora commuted between London and Germany every week, transforming T-Mobile into Europe's dominant carrier along the way. It was in this role that he first met Sunil Mittal, Chairman, Bharti Group, at an industry conference. Mittal used to ask for Arora's counsel, and later, Arora would join the Bharti Airtel board.

In early 2004, Arora got bored yet again. He was on the verge of setting up a mobile value-added services company when a call came from a friend about an opening in Google. Arora seemed intrigued enough to visit Google's London office, which was in the middle of an industrial park.

He was rather unimpressed, but a few days later, the founders Page and Brin wanted to meet him. Their meeting took place while walking around the British Museum. A few days later, Arora met Schmidt and was soon chosen over 25 others as the new chief of Google's European operations. In four years, Arora took EMEA's revenues from under $1 billion to $8 billion, spread Google's business to over 15 new countries and took the employee count from 1,000 to 3,000.

Google was quick to recognise Arora's contribution. "Nikesh very quickly brought order to our European sales organisation hiring great people in many countries where we operate and building close relationships with our local partners. He's always understood that one size can never fit all, and that you need different strategies in different countries to address local cultural and business nuances, says Chairman & amp; CEO Eric Schmidt.

Arora saw opportunities for Google that the company itself wasn't able to spot. His first boss at Google, Omid Kordestani, who built the Google business model and is now senior adviser to the CEO and the founders, says: "When I first met Nikesh, he was impressed with Google's success in Europe but had bigger aspirations for us. He wanted Google's business success in the rest of the world to match what he saw at Google's operations in Silicon Valley and the US. He focussed on building an impressive team of professionals and establishing operational excellence across all regions under his management. He is passionate, intelligent and hard working, with a tireless commitment to getting things right. He applies the same skills to his golf game, though he should not bank on that as a profession!

A unique strength that Arora brings to the Operating Committee of Google is his global multi-business experience and his "out-of-Mountain View thinking. This is particularly relevant at a time when Google's growth has slowed down in mature markets such as the US and Europe and it needs more diversity and balance in its revenue mix (over 80 per cent of its revenue comes from the US and Europe).

Also, Google is entering new areas such as display advertising and developing whole new technologies to take on newcomers as well as continuing to battle away with Microsoft (not in the least by launching a new Operating System Chrome). This means Arora will have to maintain Google's tremendous money machine. Google generated $5.5 billion in revenues for the quarter ended June 30, 2009, with a net margin of 26.9 per cent and a market capitalisation of $138 billion.

Arora, therefore, isn't all that bored anymore. After all, he has a new job. After finishing his India visit recently, during which he also attended the Airtel board meeting, Arora has moved to Google's headquarters in Mountain View, California, from London. Maybe, that is because there is some great golfing in Northern California.