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MIRANDA CARLA - Yahoo Analysis - Competitive Strategy SEC A
MIRANDA CARLA - Yahoo Analysis - Competitive Strategy SEC A
Although it is a fine value proposition, it does not make the company unique, and is a proposition that can easily be copied by any
competitor. In fact, this is what has happened. Yahoo has been eclipsed by many other companies, in their content , social media,
advertising and search efforts
What can Yahoo do differently or better than others to achieve its goal to make the world's daily habits inspiring and entertaining?
Currently, Yahoo continues to make money mainly because of its large base of users: Over One billion all over the world. And
with such a large base, Yahoo has an asset that It has not really taken advantage of: Data.
Other strong points that we can rescue: mainly the integration of its services, and their easyness of use.
SWOT Analysis
Strengths
Weaknesses
Unprofitable acquisitions. Tumblr has a $1.1 bn price and there has still
not been results
Lack of disruptive / differentiating products.
Some products are unknown or have lost their status: Flickr, Yahoo
Screen was just shot down.
High expenses that reduce profits
It missed the prosumer revolution. Although it had Yahoo Answers as
an user generated content platform, it did not grasp the opportunity to
create a strong social network
It also missed the opportunity to to reach younger audiences.. It had to
buy Tumblr to gain access to millennials
Opportunities
Threats
New Entries
Customers
MODERATE TO HIGH
HIGH
LOW
Competitors
MODERATE TO HIGH
Substitutes
Consumers can get their information and
entertaining from a wide variety of sources, not
only digital / mobile. Although the trends seem to
favor the later
MODERATE
The Internet Media industry is highly competitive and it is also really vulnerable to change and disruption.
Assessment of Industry
+
+ /-
Yahoo has the supplier force under control. In most cases, it produces its own content, and for other
requirements It has established important and lasting agreements with the biggest players in Silicon
Valley: Microsoft, Google .
Yahoo is exposed to many new entries in an industry such as this one. Yahoo has responded to this
threat by acquiring some tech and media companies. However, this is not always easy nor cheap, since
there are many investors bidding for the most promising new companies
Yahoo still maintains a large base of Customers. Its current focus on the development of mobile
services is a great first step to try to remain relevant to the consumer. Also, Yahoo has hinted that it is
developing a new product related to predictive search, that maybe what consumers are looking for
next.
Competitors are an important threat to Yahoo, mainly because Yahoo does not have a strong
differentiating factor, but also because the most important players are offering experiences to the
customers that have an important switching cost. For example people will not leave facebook if their
friends are still using this platform.
Substitutes Thanks to the change of direction proposed by Marissa Mayer, (CEO) by betting on mobile
services, Yahoo is still relevant at least in technology to its users.
8,000,000
6,425,679
7,000,000
6,969,274
7,521,731
7,208,502
6,460,315
6,324,651
6,000,000 5,257,669
4,984,199
5,000,000
2,000,000
4,680,380
3,945,479
4,000,000
3,000,000
4,986,566
1,877,407
731,568
1,000,000
639,155
418,921
597,992
1,231,663
1,048,827
2010
2011
4,618,133
1,366,281
0
2005
2006
2007
2008
2009
Net Income
Revenue
2012
2013
2014
Yahoos Challenges
Challenges
Become
relevant
to
users
Profits
Corporate
challenges
Yahoo has not led neither the search or social media industry and it just
focused on mobile during the last couple of years.
Yahoo is not indispensable for users. Their identity is not strong enough
Find the best way to turnaround the company to achieve once again
profitable growth.
Turn acquisitions into profits. Major investments have been made and results
are still not visible.
Find new ways to monetize, since its display ads revenue is decreasing and the
mobile and native ads are not growing as expected
Once the most important portal on the internet, today the stagnation of
growth has made its investors impatient and they have begun to Marissa
Mayers role as CEO (after 3.5 years on the position).
Yahoos market cap depends mainly on its investment in Alibaba and Yahoo
Japan.