In the middle of January, Google purchased Nest for over US$3 billion. Nest (nest.com) sells smart thermostats for the home, which learn your temperature preferences and adjust themselves accordingly. However, this article is not about Nest, but its rival, Vivint (vivint.com).
The competitive thermostat landscape changed dramatically with Google’s acquisition of Nest – suddenly Vivint found itself competing not against Nest, but potentially the giant that is Google. Just a few weeks after the purchase of Nest, Vivint found itself delisted from all but three of the 3,300 search terms in Google’s organic search results.
Google has been known to penalise websites which do not follow the guidelines, by dropping their position on the organic listings, but removing the listing entirely was deemed by SEO experts at the time as ‘unusually harsh’.
Google was not forthcoming on why Vivint was so severely delisted, but, after a lot of investigation by Vivint and with minimal cooperation from Google, they managed to find that the error was due to improper linking on their website. For such a small technical mistake, Vivint’s listings in Google’s organic search engine were wiped out for a period of four months. During that time, their only option for presence on Google was by paying for advertising through an Adwords campaign.
Vivint managed to survive this delisting debacle by having good relationships with other search engines and a strong door-to-door sales force. But that did not mean that their productivity was not affected. After a while, their organic listings were reintroduced to Google, but their rankings in the search engine took some time to recover.
When I read this article, my mind quickly assessed how this lesson could be applicable to businesses in Australia. I have come across many companies where the model is heavily, if not solely, dependent on one particular party to be successful.
If you take a close look at your business model, from order taking, to product acquisition and fulfilment, you could potentially face the same situation as Vivint if any part of your model is dependent on one party, with no alternatives.
Is your business dependant on just one supplier? Just one major client? Just one third party to deliver your products to your customers? Just one staff member who is ‘irreplaceable’?
If it is, you would be wise to put contingency plans in place so that your business will not suffer if, for some reason, that party fails to deliver. Vivint survived because it had alternative sales channels to bring in the cash flow while they sorted things out with their Google rankings. Likewise, having more than one way to fulfil your business model will serve your business well when the unexpected happens, which is the case for most businesses from time to time.
“We do not need to make the mistake in order to learn the lesson. Learning it from other parties is a less painful way to be better.”