It doesn't really matter what Mozilla did. They never had the budget to compete with Google on browser advertising anyway.
If you look at the market share progression of the old opera and mozilla vs. internet explorer, and you compare it to the stellar rise of Chrome when it came out, it's really obvious that Chrome's success is due mostly to advertising.
Blows my mind that people think that there’s some magical way that Firefox could have competed. Chrome had ads on google.com, like the home page. No one except Google gets those ads. 90-second prime time tv spots. And they also scattered nudges throughout their entire website. Google ran a relentless ad campaign to get people to switch, and no browser on Earth was able to compete with that.
I agree Firefox never had a chance, but there is losing a battle and there is diving head first onto the floor. Mozilla played the few cards it had not that well.