Monday, January 28, 2008

What is the problem with Yahoo?

Some people would answer that question with these five words: 'it', 'will', 'never', 'be' and 'Google'.

One of the first sentences of an excellent article on ZDNet, written by Stefanie Olsen, goes like this:

If Yahoo could be placed on a psychiatrist's couch, the internet giant would be told it was suffering from an identity crisis.

Here in Europe the problem is even worse, with the site languishing even further behind the dreaded Google in terms of search traffic.

As the ZDNet article explains, Yahoo and its reasonably new CEO Jerry Yang - one of its co-founders - have a tough job on their hands.

In the meantime, employees are waiting anxiously to see if the widely rumoured job cuts are coming their way.

All is quiet in the UK. Tim Frankcom, who used to run travel for Yahoo and Kelkoo across Europe, has moved upwards in the Yahoo foodchain and has not been replaced.

Any questions about Yahoo and the fate of Kelkoo - a hot topic considering that Yahoo in the US has recently intergrated its highly rated Farechase into its travel channel - are met with a line about no comments ahead of financials.

Fair enough. The problem with not saying anything is that speculation mounts. And the market is talking a plenty...

Kevin May, editor, Travolution

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Richard Hartigan said...

Last year promised to be a big year for Yahoo! They finally implemented their much anticipated new Panama advertising system and rolled out changes to their main search product including ‘search suggest’ functionality. However these changes have clearly had little impact on market share. Here are three potential reasons why:

1. As an advertiser, we have found that since the move to Panama, our costs have risen significantly. The system is also far less user friendly and the support and problem resolution offered is lagging behind the other engines.

2. Yahoo's key differentiator has always been behaving as a portal rather than a search engine. But as Google increasingly marches into this area with products such as the personalised home page and Gmail, this selling point diminishes.

3. In my opinion, the changes were not supported with adequate marketing. When made their changes, this was backed up with a through the line marketing campaign including television, press and even advertising on Google.

Potentially one encouraging factor is that with many organisations continually investing in SEO in order to gain traction in the organic rankings on Google, there is the potential for Yahoo! and MSN to begin to display comparatively more accurate search results.

All of this amounts to Yahoo! having to make some big strategy decisions early in 2008, particularly with regard to the European search market as advertisers such as ourselves are continually reviewing the amount of marketing budget they are prepared to invest.

The biggest problem is that with Yahoo! clearly floundering and MSN failing to make any significant impact, the bargaining power of Google can only get stronger.

Darren Cronian said...

‘The power of Google can only get stronger’

Don’t you think that is worrying though? As someone who writes on a travel blog I rely on Google to refer visitors and the thought Google being in control of my business is quite a worrying thought.

I realise you shouldn’t build your business on one search engine, which I don’t, but the traffic from other sites counts for only 2-3% of traffic that hits the blog, and I have links on a number of authority travel sites including USA Today, and of course Travolution.

I spend a lot of time networking, and promoting the blog so one of my aims for this year is to increase traffic from non search engines.

Anonymous said...
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Travolution Blogger said...

lijialefw: Spam!