What Next For Yahoo? - Industry Reaction

With the departure of Scott Thompson as CEO and appointment of Ross Levinsohn as interim CEO, Yahoo! plunges ahead with – still – plenty of assets including 700 million monthly unique users worldwide (175 million in March in the U.S.), a healthy, but illiquid chunk of Asian Internet properties, and the company remains a display powerhouse in spite of heavy employee turnover and aging ad tech save the recent acquisition of interclick and best efforts by Yahoo!’s internal dev team.

A third change in leadership in the past 9 months can’t be a good thing. But, oh well. Here Yahoo! is. What to do next?

AdExchanger reached out to several executives in the online ad ecosystem and asked them exactly that – what should come next for Yahoo!?

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Tim Cadogan, CEO, OpenX – formerly Yahoo’s SVP of Global Advertising Marketplaces

“Whoever runs Yahoo – now Ross Levinsohn – has a truly herculean task. They have to get a large, relatively inert, battle-scarred mass moving fast again. The laws of business physics make that very, very hard.

However, the core two elements are relatively clear. First, select and articulate a focused strategic, consumer direction: one or two bets that have a shot at rejuvenating audience growth. Hire (and/or buy) a fresh, new cadre of fantastic product and tech talent that can innovate on top of Yahoo’s assets to create that audience growth. Overpay them gratuitously as that is probably the only way to get them in right now. Second, invest in the underlying technologies that monetize that audience. Advertising is at the heart of how Yahoo makes money and the ad tech space still has the capacity to deliver disruptive upside. By investing in the technologies, partnerships and/or companies that can accelerate innovation, Yahoo can drive and harvest an inflection point in ad revenue growth.

Then clear the internal organizational path for this twin effort: strip out the old assumptions, creaky operating models and management layers that have calcified Yahoo’s dynamism. Buy Yahoo time externally by sharing a clear, crisp and believable turnaround story.

Stick to it – it will take years of raw persistence. A surprising number of people still root for Yahoo and whoever reignites Yahoo will secure a rare spot in business history.”

Bill Wise, CEO, MediaOcean – formerly SVP/GM, Global Exchange at Yahoo!

“Yahoo does not have a CEO problem. They have a business transformation problem. All of their traffic originates from two main sources– 1. Email, 2. Homepage. Without these two starting points, Yahoo cannot afford all the vertical premium content they produce. Facebook and smart phone apps are replacing Yahoo as the starting point for people, and the younger generation are using alternate means to communicate… Texting, messaging, comments within social media and apps are all replacing email. Even within email, an @me and an @gmail are “cooler” than an @yahoo address. Yahoo needs to focus on their COMMUNICATION strategy or else they will lose their scale and distribution of media. Ross is the perfect person to run Yahoo until a private equity firm comes in and completely reinvents the business… The only way Yahoo remains relevant is if they go private. They cannot do what’s necessary as a public company.”
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Greg Coleman, President, Criteo – formerly EVP of Global Sales at Yahoo!

Yahoo is still a great brand and actually having 5 board member resign fast is a great thing for the company. The combination of Ross Levinsohn at interim CEO and Rich Riley as President of the Americas presents a real dynamic duo. The ad community still wants to root for Yahoo and these guys have the chance to make some real cool and fast moves to remind them of what an important marketing partner Yahoo still can be. There should be nothing to hold these guys back and it is prime time now… cut the red tape and GO.”

Ramsey McGrory, CEO, AddThis – formerly Head of Right Media Exchange at Yahoo!

“Yahoo! remains a world class global media company. It’s one of the few digital media companies that measures revenue in billions. It’s only been four months so my original recommendation remains mostly the same. I would augment it with intra-company priorities and one new recommendation.

Fix morale. Morale = productivity and retention. There are still many solid people there, so retention and continuity are key.

Build leadership culture that promotes innovation around owning the consumer experience.

The regions and product must be aligned around what business and product steps to take.

Connecting mobile, display, video/connected TV through the strong 1st party relationship Y! has with consumers. FB, Google and MSFT pushing hard here and Y! must compete there to be independent long term.

Data, data, data….did I say data? Anonymous, personal, online, offline, all for making (b) better.

Remove non performers and bad actors…..It’s good to have disagreement. It’s not good to have undermining behavior once a decision has been made.

Clear the FB patents issues off the table.”

Megan Pagliuca, VP & GM of Digital Media, Merkle – formerly Senior Director of Professional Services at Right Media

“It’s widely known that Yahoo has continuously struggled with its identity and core focus – are they a media company, a technology company or both? Appointing an engineer as the CEO was a statement about the future of Yahoo, that they were going to be a media company AND a technology company. It’s quite ironic now, knowing that Scott Thompson wasn’t actually an engineer. A major ramification of this debacle is that the CEO of Yahoo will not be an engineer, rather a leader that has media running through his veins. Ross Levinsohn will ensure Yahoo is a media company, not a technology company.

Yahoo is still the largest digital publisher with the most marketable inventory for advertisers. With the purchase of Interclick, they now have the people and processes to effectively monetize this inventory. They should sell their technology businesses and get over the need to own the advertising technology. I believe we will actually see this happen soon with Ross taking the helm.”

Kurt Unkel, President, VivaKi Nerve Center (Publicis)

Ross recognized early the important role that addressability / programmatic buying will play in the future of media, and his team has helped drive change in this area within Yahoo that has benefited the Vivaki client base. He’s also led the development of compelling content experiences, such as the Electric City initiative, that offer the branded side of the advertising equation intriguing opportunities to connect with consumers. Yahoo’s very relevant with our clients & teams as a result, so Ross’ tenure has been a good one from our position. We’re eager to see if his new appointment will allow him to continue the organization’s focus on these two areas, as we believe Yahoo has made a strong market leadership position in advertising and we want to see it continue. At the same time, with Google’s growth in display, Microsoft’s focus on display, and many strong established and developing players, if Yahoo becomes distracted, that position could easily slip away. But we believe Ross’ appointment is a good sign that Yahoo’s focus on advertising and the consumer will continue and look forward to continuing our strong relationship.

By John Ebbert

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