Saturday, August 11, 2012

How Yahoo Can Get Its Mojo Back (Not With Free Food & Acquisitions)

Read with interest an article in the Wall Street Journal about Marissa Mayer's early moves as Yahoo! CEO. She's got a lot of things right, but the branding element is not there yet.

From a human capital perspective, these good things jumped out:

  • Regular, open Friday meetings with staff
  • Personally vetting all new hires
  • Making cafeteria food free

From a general leadership perspective -

  • Focus primarily on the user, not on selling the user to the advertiser
  • Stop obsessing about the stock price
  • Wait to talk about strategy till you're on firmer ground

The branding part is not there. I wouldn't expect anyone to announce their strategy right off the bat but I get the feeling she is either taking a copycat approach or being mischaracterized that way. Generally it seems to me that technology companies over-rely on human capital and utility and under-rely on the image element (Facebook and Google are both prime examples) so I am not sure what to think.

Obviously Yahoo! isn't going to succeed by literally copying Google...we know that right? (Title of WSJ article: "A Makeover Made In Google's Image") Because to succeed in marketing anything you have to have either a monopoly or a position. Google and Facebook were early monopolies at what they did...Yahoo! has no such luck. Copycatting is not a position, so I winced when I read that she was working on Google's specialties, email and search:

"Since taking over Yahoo three weeks ago, the former Google Inc. executive has talked with Yahoo's product leaders about how to reverse the declining usage of the company's search and email service, said people with knowledge of the matter."

Yahoo! needs a position that it can defend, not better email and search. Already, people use the term "to Google something" to mean searching for it online. Yahoo has to get away from that.

Yahoo! can position itself in one of two basic ways:

  • Demonstrating functional superiority at meeting a need - pursuing the monopoly approach, by finding something new to do. Example: A lot of companies make coffee, but there is no coffee that tastes as good as Starbucks, period. Forget everything else - I just can't drink Dunkin' or Panera. Even illy tastes thin half the time.
  • Convincingly creating an image that people want. Example: Prana T-shirts have that image of meditation, New Age wisdom, etc. that provides me a shortcut to that Zen state of mind. They charge in the $50 range for T-shirts and yoga pants I can get for less than half the price at Target...and although I know they're a waste of money I understand why other people buy.
It seems to me that Yahoo! has all the makings of a good challenger brand. I remember the early days, the funny commercials, the guy yelling "YA-HOO!"

There are probably a lot of people who don't want to be cultish Google-ites and have their entire lives governed by Big Data.

Mayer should take everything she learned about why people loved Google, and turn it into a strategy for appealing to people who hate it, or might hate it, or at the very least what it stands for.

She could pursue the approach offered by Adam Morgan in Eating The Big Fish: How Challenger Brands Can Compete Against Brand Leaders. Remember Avis - "We Try Harder"? That's what Mayer has to do. Convince people that Yahoo stands for something people really, really hate about Google.

Of course the big challenge is accurately discovering and defining what that is, then repackaging it for a buying public. But it could be less of a challenge than people think, especially if one sees Yahoo! as ultimately a niche or accessory brand rather than a direct competitor to Google. From an economical standpoint, it might even be useful to go back to the brand's heritage, maybe take the old Yahoo! commercials from the '90s and put them back on TV.

"Do You Yahoo?" I don't, but can imagine people who would answer, "Yes, I Do!"