Gist: Yahoo! has a facet of itself that differs it from its competitors, and this gives them somewhat of an upper hand, despite their search business being not up to par with Google. Consumers will still flock to Yahoo! for its content and unique (but obvious) offerings.
TechMeme reported today that Yahoo! Inc. (YHOO)’s celebrity content site Omg! is receiving excellent reception from the public. Yahoo! Inc., who after its snafu with Microsoft Corporation (MSFT) due to a buyout offer (which was declined by then-CEO Jerry Yang, saw their stock price plummet to below-offer valuation.
Now that Yahoo! is under new management under ex-Autodesk (ADSK) CEO Carol Bartz, it’s interesting to see the new direction that Yahoo! may go into. Their search, at 9% market share, still isn’t beating Google (GOOG) at 80% (source). However, they remain the #2 trafficked site on the internet (Alexa ratings) behind Google. Yahoo! has three facets: it provides 1) consumer services, 2) business services, and 3) content.
Google, as well as other monoliths in the web space, provide both 1) and 2), in many areas such as (what Yahoo! currently dominates in, and has done so for years) mail, news, search, and finance. However, Yahoo! has the upper hand on the content area. Their content generation that they employ gives them a different consumer perspective: while Google provides services, Yahoo! provides services, and content. Google, on the other hand, doesn’t do content, for the most part.
The content generation present at Yahoo! include the omg! celebrity news site, Yahoo! Astrology, and Yahoo! Shine, Yahoo!’s lifestyle information site. What else separates Yahoo! from its competitors? Yahoo! Personals, Fantasy Football, HotJobs, and Upcoming.
The main idea is that Yahoo! provides information services for consumers. Their various services are so multi-faceted that consumers have much to pick from, from their selection. They provide more than news; real estate, job search, health, games, and directory.
On the other hand, Google is a data-oriented company. Google’s offerings, such as Docs/Spreadsheets, search, calendar, Gmail, and Reader, are targeted to deal with data, not information. The difference is in the nature of the content: is it generated by you, or is it generated by someone else?
There’s obviously overlap, but the idea is: Yahoo! is a lifestyle company. Their offerings are targeted toward more of a lifestyle approach, such as with omg!, Astrology, Shine, or games, tickets, sports, and the like. Yahoo! is about media. Yahoo!’s competitors, such as Google, are more about getting work done.
The slice of the market that is interested in lifestyle content is not miniscule. There will always be a large market for lifestyle content, and Yahoo! has a multitude of services that make it a monolith of content and services. Yahoo!’s greater flexbility in what exactly they want to offer sets them apart from the rest of the competition.
Yahoo! is a different animal than, say, Google: while search is an important part, it’s not the most important part. Yahoo!’s services allow it to target ordinary people on the web with content, information, and general services. So can it recover? Maybe. They need to focus on what sets them apart, not what makes them the same. And maybe—at some point—they might make a comeback.
Tags: acquisitions, autodesk, google, microsoft, recovery, search, Web, yahoo
