Yahoo: How to stay alive.

In My Humble Opinion.

Firstly lets make this clear, I struggle to run a small business in Yorkshire so I won’t pretend to be a Silicon Valley hot shot business guru who is going to take over from Marissa Mayer, however that said it doesn’t mean I haven’t wondered what Marissa and team should do about Yahoo.

Back in the heady days prior to the dotcom boom and bust of 2000 I was building website and using the fairly ubiquitous search engine Yahoo. I still remember scoffing at my colleague Nick when he asked had I used Google, ‘Google’…who is that? Fast forward a lot of years and a lot of people might say ‘Yahoo’…who is that? What a fall from grace.

In those 10 years from 1996 to 2006 the battle was won, in my opinion, through some branding genius on Google’s part, possibly unintentionally.

I think the problem is one of perception, for me, Yahoo is seen as a ‘corporate’, but Google has retained it’s ‘startup’ youthfullness, even though it dwarfs Yahoo. GOOG $370B to YAHO $49B. Maybe part of that comes from the fact that Yahoo had it’s IPO in 1996, one year after being created in 1995, on the other hand Google had time to stay young, it was founded in 1998, but didn’t IPO until 2004. Maybe Yahoo grew up too soon and was pressurised to be a profit centre far too early. Whereas Google, had time to play and discover what it wanted to do… and it decided it wanted to do EVERYTHING!

I’ve moved from being a staunch Yahoo user to a Google lover because of the cheery-fun way Google does business, and the eco-system is so well structured to allow me to join up my professional activities like adwords, analytics and webmaster tools and my personal worlds like photos, hangouts and email all on my phone, it just makes me want to use them more. And Google have given us so much for free, yes I know they are an ad-machine, but I don’t often see the adverts, I rarely click the sponsored links. The success of Google is spellbindingly good, because they allowed us to own Google and be part of that startup growing into adulthood. That spring in Googles step, sadly is an enditement on Yahoo, with it’s weird corporate approach that seems to have been marketed by Corporate-Americas finest(read: stiffest) marketing guys, how could they, with such a head start, let the new boy beat them so thoroughly?

And I guess that is the cloud that hangs over Yahoo.

So how do they move on? Forget the past, throw it all away? Chase past glories? Or try and be Google?

As I started this post and researched my thoughts I started to get a little worried for Yahoo, I mean how do you beat Google? Google’s market share is so massive that Yahoo cannot hope to better them, or can they. Lets rewind to the days in the 90's when only designers used Apple products, Apple had about 1–3% market share in the computer world and virtually everything else was Microsoft powered. Yet Apple is now worth $679B and Microsoft is worth $394B. So how did Apple overturn Microsoft? By being Apple. Steve Jobs didn’t change his way of doing things to try beat Bill Gates he just kept doing what he was doing and that single mindedness paid dividends, he thought hardware was the way and with the Macintosh and the iMac, iPod and iPhone he was proved right. Yahoo need to focus on what they do and do that to the best of their ability and leave the Google chasing to the startups. However because Yahoo brought in a Googler, Yahoo has signalled it wants to be like Google and they are chasing the impossible dream, there is no way they can out-spend Google on acquisitionss or out-hire Google, the Yahoo pot of gold is a 7th of Google’s.

What’s the answer?

I have just read that Yahoo is trying to be the preferred search partner of Apple, they are trying to get on the is platform which has 11% market share to Androids 84% …for anyone who has been asleep Android is Google. So no matter where Yahoo turn they are the ‘also-rans’, and that is not the answer, America is not the answer.

What would I do if I was Marissa Mayer, I’d spend on mobile because if Yahoo doesn’t they are another step removed from success, mobile isn’t going to revive their fortunes, it’s just going to keep them in the game. Spend on non-US/European markets, buy South American, African and Asian platforms. Dominate in search outside of the US before it is too late. The UK uses 89% Google to 3% Yahoo… unless Google screw up something really big with all our data, that is passed recovery, I’d say. Do not build a mobile OS or a Phone (Amazon!), that ship has sailed. Create a non-Yahoo brand that the kids can use without feeling uncool, and stop branding everything with Yahoo, your brand name as stated above is dead to anyone younger than 35, you need Tumblr and Flickr to retain their identity.

Create the skunkiest of skunkworks and chuck millions at it, go for software and related hardware, let someone else do driverless cars, protect the skunkworks from the finance department and shareholders. And something a little leftfield, invest in Bitcoin, move that baby forward, create your own teams to build on it and embrace it.

I think that Marissa is doing all that she knows best, she probably has lots of information I don’t so has aquired what she sees as the best solutions for Yahoo. So this is not a piece bashing her, the issues at Yahoo are older than the last few CEO’s before Mayer, I think they are deep seated and unless she can foster the innovative youthfulness of Google inside Yahoo, she may well be the last CEO at Yahoo, ever!

Because if she fails it will be seen as a sinking ship. Which will make me sad.

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