Yahoo! - case for a complete transformation

Getting that emotion back to the brand

Today’s brew is for Yahoo!
Brew Date: 13th May 2015
Type: Served Warm – Redesign & Transformational brew

The word "yahoo" is a backronym for "Yet Another Hierarchically Organized Oracle”. It is an American multinational technology company. It is globally known for its Web portal, search engine Yahoo Search, and related services, including Yahoo Directory, Yahoo Mail, Yahoo News, Yahoo Finance, Yahoo Groups, Yahoo Answers, advertising, online mapping, video sharing, fantasy sports and its social media website. 

An interesting thing that hits mind, is that both Yahoo and Google started in a similar manner, in a way, while conventional search engine ranked results by counting how many times the search terms appeared on the page, the Google theorized about a better system that analyzed the relationships between websites, and Yahoo was site consisting of directory of other websites, organized in a hierarchy, as opposed to a searchable index of pages.

I guess for both, each other’s products were fine extension of a full service feature, Yahoo ended up focusing only on the product side of it, however Google focused on the Purpose of its product. The difference in the case being, one was making products, the other was making consumers.
The case is still the same today, though both the firms exist to cater different sets of needs, on a technology continuum, Google and Yahoo have products with similar functionality, however Yahoo still operates as Technology Company satisfying Consumer needs, whereas Google operates as a Consumer Company enabled by technology, (they are not compared here, albeit the purpose to see the distinctiveness in their ideologies.) Infact, Yahoo understood the shifting paradigms well, as it grew rapidly throughout the 1990s and diversified into a web portal, followed by numerous high-profile acquisitions. 

To understand the business model of Yahoo, please refer the following links:

The Brew will analyze Yahoo! majorly in 3 parts:
a) Business Analysis
b) Improvisation to Business Strategy
c) Tactical Moves for Yahoo!

a) Business Analysis:
Though Yahoo! is understood by many as Technology company, its tends to be more of a Product company, while being on a static technology paradigm. Yahoo! currently operates in the areas of Communication (Yahoo Messenger and Yahoo Mail), Social Offerings with User generated content (Tumblr, Flickr etc), Offering Content ( Yahoo Sports, Yahoo Finance, Yahoo Music, Yahoo Movies, Yahoo Weather, Yahoo News, Yahoo Answers and Yahoo Games ), Mobile Offerings ( email, instant messaging, and mobile blogging), E-Commerce ( Yahoo! Shopping, Yahoo Autos, Yahoo Real Estate and Yahoo Travel), Offerings to small businesses (Yahoo DomainKeys, Yahoo Web Hosting, Yahoo Merchant Solutions, Yahoo Business Email and Yahoo Store), Advertising (Yahoo Search Marketing provides services such as Sponsored Search, Local Advertising and Product/Travel/Directory).

Incidentally, if you are looking out for Search as an offering, then it’s Microsoft’s Bing, which powers Yahoo! Search

With respect to business analysis of Yahoo!, following are the pre-thoughts that come to mind,
1) Yahoo! is a product company, with offerings in technology fulfilling consumer needs (and not the other way round). This implies that its core products have remained the same apart from undergoing tweaks, which on an evolving technology paradigm is difficult to achieve

2) Yahoo! has persistently followed Acquisitions as its route to better augment its brand. Its history testifies string of offerings its acquired.

3) Of quite a lot of these acquisitions, a good many have gone defunct as well (for that matter a lot of organic offerings as well have), which highlights that Yahoo! does not understand the synergic values of these, while developing the value propositions.

4) These acquisitions were bought at the near peak of their respective business cycles (they operated independently cos of the business maturity they had achieved, and the brand revamp would have hurted the acquired), and certainly would have added great value to Yahoo! model, had it capitalized on these businesses, Consumerability (Usability + Value + experience + Synergy with other Yahoo! businesses) along with brand Yahoo!

a) Business Analysis:
1) Being established that Yahoo! is a product company, infers that its does not have a vision mapped to Consumerability when it comes to influencing consumer behaviors (enabled by technology), though thebrew recommends it to have one, after putting the house in order, which the other points discussed, but having a vision requires either the mindset change in Leadership or an overall Leadership change at the helm

2) To understand what has worked well for Yahoo, when mapped to the business equation:  Competence + Strategy = Competitive Advantage, Yahoo!’s competence are not their products, neither the technology, rather it’s the Brand Yahoo! and its first mover advantage it had in pioneering consumer trends, where ideally Cues should be drawn to experiment more at Yahoo!, effecting it to be more active in Startup ecosystem, where the unique value propositions can be caught early and taken in Yahoo! fold. Incidentally, this will as well require a visionary understanding of Consumers trajectory for success.

3) Given its strategy to grow inorganically, it should ideally have built a competence in methodology of identifying these acquisitions, integrating them seamlessly with the Yahoo! model (Organizationally, Cultural, Operational, Ideology and Experience delivered to Consumer), and Capitalizing its synergies  to the overall brand and other group offerings, along with Consolidations. (Requires Group Vision & Tech excellence as well)

4) Yahoo! does not have key drivers identified which will drive its future growth, and it wont be long before history repeats with another set of impulsive acquisitions in the continual cycle of its losing business value.

a) Improvisation to Business Strategy:
1) Developing a Strategy (with a view to create scalable competence gradually) on the lines providing Great User Experience for all Yahoo! Offerings, Creating a strong technology, Consumerability & Brand layer within which will optimize the User experience at Product Level as well as Group Level

2) With respect to its strategy for acquisition, developing a competence at a framework level to identify new technology developments early in their lifecycles, acquiring them, consolidating technologically and spreading their competence to other group companies. Experimentation with the Startups will play a key role with a possibility for higher success given the brand association of Yahoo! along with getting better technology at lower cost to experiment is a decent value prop for all stakeholders.

3) Following the Content Strategy of building up ecosystems and opening it to the 3rd party offerings for all the offering models. A mix of Products + Technology + Content will lead Yahoo! to a decent Consumer centric driven brand, and hence pursuing aggressively its Content Strategy with an open ecosystem model to have a continual brand engagement with the Users will be the key.

4) While all these happens in the front end, building a strong Personalisation driven backend will be the key for Yahoo! ‘s growth, to not only get more consumers but as well have a stronger ecosystem with all key stakeholders on it. It as well lays a strong case to over time spread to its proprietary offerings post reaching maturity on the understanding the user behaviors and interests.

Tactical moves for Yahoo!:
1) The problem that stares us in face is there is lack of key drivers on future growth, Yahoo!’s absence in mobility space with strong engagement is definitely a concern, along with the need of creating a great mobile user experience.  

2) Creating a good user experience by replicating the experience of tumblr to Yahoo Communication offerings.

3) Going for an entire revamp of, especially for Content,  by replicating the user experience of tumblr, making it a platform model to host and promote content.

4) Though Web Advertisement module looks strong, there is no presence in Mobile marketing, Mobile advertisements, and hence, building a presence there will be a key along with developing mobility experience.

5) Getting in the Social sphere with the current offerings, where Users can surf any of the offerings, and it comes on MyYahoo (MyYahoo is the Social Personalized spaced of User’s interest along with their activities), from where it can develop further personalization. Merging it along with Yahoo Communications will be a great case for Usability with convergent experience.

6) Focusing on startups in the space of high user engagement on mobility, AI and predictive personalized offerings along with developing open ecosystems for 3rd party apps, information and experience.

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