Mayer nabbed from Google...will it save Yahoo?

TheKing's picture
Rank: Senior Neanderthal | 5,744

Yahoo, the world's largest internet "portal" made a bit of a splash yesterday when it announced that it was scalping Google's Marissa Mayer to fill its recently-vacated CEO position.

Per Bloomberg, the 37 year old Mayer joined Google in 1999 as its 20th employee. She is credited with maintaining the company's spartan home page for a decade and overseeing such products as Gmail, Google News, and image, book and product search.

The mission she's accepted as CEO will be twofold...

  • To bring back users who ditched Yahoo for Google and other sites
  • To boost advertising revenue

It's on her to fix the fortunes of a company that's seen three straight years of declining revenue and three CEOs in less than one year.

The question I have is, despite the flashiness of the hire, will it really make a difference?

I fail to see what Ms. Mayer could possibly do, regardless of her successful track record.

Let's face it, folks, no one on Earth is going to go back searching with Yahoo after they've moved on to Google. Microsoft pumps millions into Bing and can barely gain any traction. I mean, I'm sure you've all seen MSFT's recent adds for how search on Bing is social. Guess what, that will not move the needle. If I'm going on a trip somewhere and get travel tips from my friends via a Bing search, I'm pretty sure it's time for me to commit that, c'mon man! And honestly, I don't know a single soul who cares about this sort of feature.

I can honestly envision the meeting that MSFT held where Bing Social Search was proposed. I can just imagine some 48 year old middle manager thinking he's got the idea of a generation, the key to search success...when in reality, it's a transparently stupid gimmick that won't do a damn thing. But I digress...

I mean, short of paying users money, what would possibly drive people that use Google Search, Gmail, Gchat, and even Google Finance to leave and use Yahoo?

Nothing.

Google made an innovative product in Gmail at a time where its biggest competition came in the form of clunky desktop-based Outlook, or AOL-esque Hotmail and Yahoo Mail. It was new, innovative, and had a clean design in a world of competitors that looked like they were made with geocities (and were about as user friendly.) You might be able to make incremental improvements on an email system, but nothing that's as big a leap as Gmail was when it arrived, certainly not a big enough leap to overcome the network effects Gmail benefits from. And when you're already using Google for search and email, you're likely going to look to Google's other solutions, including Docs and Finance, before you'd look to something Yahoo or MSFT provides.

If anything, in my view, Yahoo has slowly morphed into another aol-style content site, only it's got better sports coverage and a search bar that gives decent results if you use it. At best, its news section comes off as a mix between Bloomberg and HuffingtonPost, again with better sports writers.

All kidding aside, I feel like Yahoo's mail and search businesses will continue to bleed users to better services and, in my view, it'll turn more and more into a content focused business. It's really a matter of how quickly they do this and how concerted the effort is.

Am I way off base? Is there something I'm missing? Obviously, I've tackled this from a pretty high level, but intuitively I just don't see how Yahoo ever competes with the likes of Google again. That day has come and gone and Google blew right past them.

Comments (20)

Jul 17, 2012
Jul 17, 2012

I think they should first look to recapture people who use Yahoo! as a homepage or frequently check Yahoo! for news, but who use another search engine as their primary internet search medium. If those people could be recaptured, by making Yahoo! search suck less, then that would be a huge step in the right direction. First order of business, make the search feature more prominent and closer to the center of the page; Second order of business is to simplify the website. Yahoo! is cluttered and I hate those godawful ads that emerge from the right side ad space and cover half the homepage when you first open it up. They need a more tasteful way of advertising.

Bing and Yahoo! aren't really analogous, in my view. Bing is a standalone search engine, therefore it would be directly competing with Google (dumb move). Conversely, plenty of people still visit Yahoo!- it's just that most don't use it as a search engine. Yahoo! is more analogous to Facebook than Bing in that a lot of people use the site- it's just the issue of monetizing all that traffic.

Jul 17, 2012

Unless she is bringing a significant team over I doubt she can do much.

Jul 17, 2012

Well, as far as Google Finance vs. Yahoo Finance, Yahoo Finance is already kind of considered the gold standard as far as free stock info goes.

Jul 17, 2012

She always seemed like more of a PR person than a CEO.

Contrast her mild-mannered approach with that of Carol Bartz.

Jul 17, 2012

The mission she's accepted as CEO will be twofold...

To bring back users who ditched Yahoo for Google and other sites
To boost advertising revenue

The one follows the other and I am not hopeful. I've used Google forever but never really understood how different a search engine can be until recently when somehow Yahoo automatically installed itself on my search bar. That's when I came to the horrific realization that Yahoo is like the herpes of the internet -- once you have that shit, you can never get rid of it. It's so vastly inferior to Google that I find it completely unusable.

Jul 17, 2012

So Yahoo is still relevant?

Jul 17, 2012

Doubtful, its hard for one person especially as young as Mayer to drastically turn around a company that is far out of its prime and has fallen far behind Google. As its been mentioned, I cant see myself using anything other than Google as a search engine and the fact that chrome is a great browser and defaults to the search engine makes it even more of an uphill battle for Yahoo.

Jul 17, 2012

She's going to have a sick golden parachute to land with around the same time her kid is out of diapers. Not a bad gig if you can get it.

Jul 17, 2012

Let's face it, folks, no one on Earth is going to go back searching with Yahoo after they've moved on to Google. Microsoft pumps millions into Bing and can barely gain any traction. I mean, I'm sure you've all seen MSFT's recent adds for how search on Bing is social. Guess what, that will not move the needle. If I'm going on a trip somewhere and get travel tips from my friends via a Bing search, I'm pretty sure it's time for me to commit that, c'mon man! And honestly, I don't know a single soul who cares about this sort of feature.

I can honestly envision the meeting that MSFT held where Bing Social Search was proposed. I can just imagine some 48 year old middle manager thinking he's got the idea of a generation, the key to search success...when in reality, it's a transparently stupid gimmick that won't do a damn thing. But I digress...

I mean, short of paying users money, what would possibly drive people that use Google Search, Gmail, Gchat, and even Google Finance to leave and use Yahoo?

Change a few words here and there, and the general strain of this type of criticism (It's hopeless! No one will ever use ___!) could be applied to basically every startup created (Facebook when it was against Myspace, Google when it was against Yahoo!).

The problem is that you're assuming that Mayer's job is to "improve" Yahoo search, and not to innovate in other areas that are not yet dominated by Google/FB/etc. Search is hopeless, in my opinion. However, that does not mean Mayer cannot innovate in other areas. Maybe under her direction Yahoo will rapidly pivot to mobile and cloud computing, areas that have not yet been dominated by Facebook or Google or Dropbox or any of the other companies in those areas (though FB/Google/etc are definitely "ahead" of Yahoo), using its mammoth reserves of content aggregation. Maybe not. Granted, Yahoo is not a startup, but the job of turning around Yahoo is probably just as tough, challenging, and interesting a problem.

I mean, if I were in her position, I'd probably take the job. At Google, she was a senior VP, and would probably not become CEO of Google for another decade or so. Yahoo presents a very interesting challenge, a challenge with a great upside (worked wonders at Yahoo), and only a slight downside if she fails (Yahoo was destined to fail anyway).

Jul 17, 2012

Yahoo! is very popular in Asia and still the #2 search engine in the world. Maybe she will focus on the less competitive territories and build localized products. I mean, Yahoo! is not going away so why not try to revive it? If she is successful, great. If not, she has ~$300 million she made from Google on top of however much she'll make from Yahoo!.

Jul 17, 2012

She should see if Microsoft will take up its old offer of $31/share.

Marko:

The problem is that you're assuming that Mayer's job is to "improve" Yahoo search, and not to innovate in other areas that are not yet dominated by Google/FB/etc. Search is hopeless, in my opinion. However, that does not mean Mayer cannot innovate in other areas. Maybe under her direction Yahoo will rapidly pivot to mobile and cloud computing, areas that have not yet been dominated by Facebook or Google or Dropbox or any of the other companies in those areas (though FB/Google/etc are definitely "ahead" of Yahoo), using its mammoth reserves of content aggregation. Maybe not. Granted, Yahoo is not a startup, but the job of turning around Yahoo is probably just as tough, challenging, and interesting a problem.

I would love to see Yahoo prove everyone wrong and become a power player in tech again. I think that for Yahoo to do something exceptional, it will have to be in new/emerging technology.

But could it be, that at this point in the game, Yahoo's problem is not merely a corporate executive/governance issue, but a broader problem of stagnation that has enveloped the entire company? I'm not a Yahoo follower by any means, but when was the last time you heard something truly exciting from the company? While executives may be the people with a plan and a vision, if the workforce can't build interesting and innovative products, can we really expect great things from the company's leaders?

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Jul 17, 2012

I don't know anything about her, but I still think Yahoo has a chance. The search is inferior to Google, but I think they're still second in search and second or third in email. I also don't think "search" is their turnaround play. I think they are still a one stop shop for many people on the internet.

They still excel in the Finance space, as well as sports. I've always been curious to see if they can monetize their sports content because it is top notch on a national level. It will never be ESPN, but that's not necessarily a bad thing. Plus, I assume they're #1 by a wide margin in Fantasy Sports.

Also, while I rarely seek out news on Yahoo, I probably get 50% of my headlines from their because it is my homepage at work.

If they could cleanup the homepage a little, focus on their core competencies and develop a mobile strategy I could definitely see Y! coming back.

twitter: @CorpFin_Guy

Jul 18, 2012

But could it be, that at this point in the game, Yahoo's problem is not merely a corporate executive/governance issue, but a broader problem of stagnation that has enveloped the entire company? I'm not a Yahoo follower by any means, but when was the last time you heard something truly exciting from the company? While executives may be the people with a plan and a vision, if the workforce can't build interesting and innovative products, can we really expect great things from the company's leaders?

Writing software is easier than you think. It's very routine. Designing a vision for the products you want to make is much harder and is something that Yahoo lacks and which Mayer might bring. A leader can engender innovation: just ask Steve Jobs, who was notorious for being a control-freak and a micromanager.

Jul 18, 2012

Honestly in fairness to her incoming kid, seems pretty selfish to nab the CEO spot at Yahoo! if you are supposed to be caring for a new born pretty soon. Who knows maybe the father will be handling that end?

When I was listening to this on NPR I was thinking that if I were this woman the thought I would have in my head would be: "Well I probably won't be able to fix it, so it won't be a surprise if I don't, but if I do, I'm a genius, but regardless I'll be a female President and CEO of a huge tech firm."

The woman has about $300mm and is on the board of Wal*Mart, so this has got to be strictly an ego move by her IMO.

Last point, I read Yahoo! news and their demographics are skewed to a lower income/education demographic, but as someone else mentioned, I like the sports news more than reading ESPN.

Jul 18, 2012

The sports section of Yahoo! is awesome, especially when Fantasy Football rolls around. They recently started updating the page and it looks like ass so I hope they roll back the changes. As far as Yahoo! goes as a whole unit, everything they touch turns to shit. I don't think they will pull out of their downward spiral and will end up like AOL as someone said before.

Jul 18, 2012

Marissa Mayer finally gets to run a non-profit

Jul 18, 2012

Yahoo! just dicked me pretty hard because my username and password was among the 450,000 that were uploaded to the web last week (I'm a former Yahoo! contributor). There is a lot - A LOT - of structural shit she's going to have to fix to get that house in order, and I'm not optimistic.

Jul 18, 2012
Edmundo Braverman:

Yahoo! just dicked me pretty hard because my username and password was among the 450,000 that were uploaded to the web last week (I'm a former Yahoo! contributor). There is a lot - A LOT - of structural shit she's going to have to fix to get that house in order, and I'm not optimistic.

Chris Chase is that you?

The answer to your question is 1) network 2) get involved 3) beef up your resume 4) repeat -happypantsmcgee

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Jul 18, 2012
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