Navigation Shakeup

Posted by on Oct 29, 2009 in Blog, Marketing, Thinking | 2 comments

Google Disrupts the GPS Turn-by-Turn Navigation Market

tomtom_garmin

Yesterday, Google announced its new Google Maps Navigation product which will be available for free. The news has been devastating to navigation giants Garmin and TomTom, with their shares falling 16.4% and 20.8% respectively. Billions of dollars of market capitalization just evaporated in one day.

At first blush, the new product offering from Google, and the resulting market reaction, seems like a disruptive innovation. Google’s new navigation offering is going to cause some serious changes in the turn-by-turn navigation industry but is it truly a disruptive innovation?

Didn’t They See This Coming?

To be considered a disruptive innovation, an innovation must improve a product or service in ways that the market does not expect. Even I expected that one day this would happen, somebody working at Garmin or TomTom had to have seen this coming from miles away. Perhaps they did, but where was their response to shareholders? Why weren’t they prepared for damage control?

Now I just have to wait for Apple to let Google create the Navigation App for the iPhone…

2 Comments

  1. 29-10-2009
    Mike Mesh says:

    This is cool. Will be interesting to see how it pans out over the next month, year etc. How are Tom Tom and Garmin going to respond?

    reply
  2. 29-10-2009
    Rationally Creative says:

    We should hopefully find out in the next few months what companies like TomTom and Garmin are going to do in response. If they are any good at market research they should have seen this as a possibility in the future and have prepared some ideas to remain competitive. Lower prices, increase features, diversify, etc.

    reply

Leave a Comment