In financial reports for Yahoo this week, we learned that the once-hot Internet company is still facing a pretty severe uphill climb.
Their advertising business is struggling, and meanwhile, Google and Facebook is grabbing more and more attention (and ad dollars).
To me, no surprise here.
Since I left Yahoo in 2005, the stock price never came back. I remember, I set an alert on Marketwatch.com for $45.00 a share. If it hit that, I was thinking that might be the time to sell some. It never did (and it never will).
While there are many reasons for this failing giant, one is of bureaucracy, poor/mis-management of people and acquisitions.
How can you not make Flickr become a success in the mobile photo sharing market when you could?
How could you allow very popular and awesome bookmarking service Delicious.com go to hell in a hand basket?
How could you waste Foursquare acquisition opportunities? The word on the street about their “secret” company stupidity, leaked over to Dennis Crowley (Foursquare), who walked away from a $100 million dollar bid.
Last week, Google posted a 27% revenue jump, and a 17% profit increase. Sure, Carol Bartz (CEO) at Yahoo seemed optimistic, and did beat Wall Street expectations. But, after months of layoffs and few product announcements, Ms. Bartz has been staying out of the limelight. Yeah, I’d be embarrassed too.
Wall Street is not impressed, and the stock reflects it.
The 10 year agreement with the Bing (Microsoft) search engine may be good for search marketers, but Yahoo is not benefiting, and blames revenue declines on this transition. But, over time it will help save costs, which is a big deal for Yahoo.
Over time, the share of overall Web searches will increase, but hasn’t happened yet, according to comScore – which said that Yahoo’s share of the US search market dropper to 15.7% in March, down from 16.9% a year ago.
Yahoo wants to do more in the $10 billion dollar U.S. online display ad market, but it only projected to rise 0.3% this year to 16.4% (eMarketer). Facebook share of the market in this area is expected to grow to 21.6%, and Google could reach 12.6%, up from 9.6% in 2010.
What does this mean for you and your internet marketing? Keep your diversity in marketing channels going, but make sure to expand in Google and Facebook (and Bing). Yahoo is struggling, you should not.
What do you think?
Yes, I left Yahoo. Learned tons while there, met awesome people. Thank you for that.
- Heck Yeah We’re Turning Yahoo Around, Says CEO Carol Bartz (wired.com)
- Facebook Lurks Behind Yahoo! Earnings, As Portal Needs To Bet The Farm (247wallst.com)
- Yahoo earnings: ad biz jumps, search drops (money.cnn.com)