Recently, on September 6th, Yahoo! fired its latest CEO, Carol Bartz, in what has become an endless stream of attempts to pick itself up and redefine itself. I liked Carol and I like Yahoo! As I write this piece, I feel sadness. You see, I loved Yahoo! I loved their story. I loved what they stood for in 1996. Fast forward 15 years and we have a story about a company that has lost its story and its way.
By the time Yahoo! hired Bartz in early 2009 in hopes of a turnaround, it was too late. Yahoo! lacked a strategic vision, and an overarching story of who they are. Who it was no longer matters.
Who is Yahoo! today? What do they stand for? What’s their strategy? I don’t think the company knows. And neither does the market. It wasn’t always that way. Yahoo! had a great story.
As a native of Silicon Valley, I loved Yahoo! from the beginning. There were Chief Yahoo!s (Jerry and David) and a whole army of believers. We were Yahoo!s too. And Yahoo! helped people navigate the Internet by leading people to the best of the web. They were a human value-added directory. They never had their own proprietary search. That wasn’t their story – of course, they didn’t see back then that search would be key to its future. Back then, however, its value and “story” was human editorial – picking the best of the web. They did a great job. They were fun. They changed how we thought about the Internet.
Then came the famous and eponymous yodel. Ya-hoo-oo-oo! The sound joy at discovering something wondrous, as the internet was. Even the name – Yahoo! – was an “uncorporate” acronym: “Yet Another Hierarchical Officious Oracle.” Irreverent, different and innovative – that was Yahoo!, and Yahoo! was emblematic of Silicon Valley and the Internet explosion. The “Do You Yahoo!?” commercials summed it up.
Stories Anchor Us in Vision… and Identity
The thing with stories is sometimes they need to be updated as the landscape changes. Yet, companies must define their own stories rather than waiting for the winds of change to write those stories for them. Stories anchor us – they communicate who we are, where we have gone and where we are headed. You can’t navigate a company through choppy waters without a clear vision.
Stories communicate to ourselves and the world who we are. They rally the troops around a collective idea. And they rally the market and rabid fans – like me. And, like a number of companies that came before, Yahoo! became a victim of myopia, lack of strategic focus, outsourcing its crown jewels (search in this case) and arrogance.
Years later, Yahoo! realized that search was key to revenues. By then it was already too late. Sure, it bought Overture for search and it tried to create a far better ad serving platform. Yet by then, Google had beaten Yahoo! at taming the internet (an ongoing issue given the logarithmic explosion in online content). Hand-selected editorial couldn’t keep up with the growth of content. It wasn’t a scalable strategy. Even search has a “long tail” – yet, search, over time, can adapt. Google became synonymous with search, and Yahoo!, led by Terry Semel, bought media properties and declared itself a media company.
Next, Yahoo! bought social companies when social media exploded. It acquired Delicious and Flickr, among other things. It created Yahoo! Answers, one of the early success stories of social (or crowd sourced) intelligence. Yet, Yahoo! failed to integrate all these properties into one seamless search and user experience. It became a patchwork of disparate properties, often with redundancy in users and code bases. In 2007, as a user, I didn’t care where the data lived. I should have been able to search Yahoo! And see all these great answers and bookmarks from sources I trust float to the top of *my* results. Yahoo’s massive online properties didn’t talk to each other – there was no multiplier effect and there was no cohesive story either. (And much to my chagrin, it later divested Delicious, one of its more compelling social properties).
By then, Yahoo! wasn’t a directory, and it wasn’t quite a media company. It didn’t have its own compelling search – much to its own financial detriment. It had a bunch of disconnected properties and was in a desperate search of an umbrella story to tell itself and the world. Who are they? Not a directory, a media company (sure they serve ads against content) or a social media company. And most certainly they are not a search company.
Where Are We?
Fast forward a few years to the recent troubles (since Jerry Yang served as interim CEO and controversially turned down a purchase offer from Microsoft for $45 billion). In 2009, Bartz was named CEO.
With or without Bartz, Yahoo! has likely waited too late to define itself. Instead, it has been defined by forces outside its control. If you don’t define your story, others will do it for you. That’s never a great place to be. If the executives at the top can’t articulate a clear vision, how are employees supposed to champion a “cause?” And if employees can’t be proud of their company story because it lacks focus, why should the market care?
Do You Still Yahoo?
The saddest part – that loyal fans like me no longer recognize the company. Still, I want the company to succeed because it defined innovation in the valley in the mid-1990s. It was a champion; a beacon of Silicon Valley’s best and brightest. It had ingenuity, grit, and focus. It was one of us. It was the little company that could who became a big company that did – until it lost focus and its unifying vision, evidenced by the lack of a cohesive story in a rapidly changing new world.
Stories have a reflective power that is magical. Fans saw themselves in Yahoo!’s story – that anyone with a great idea, determination and innovation had the potential to make it. We – the loyal users – were “Yahoo!’s” too. That Yahoo! has lost this element of connecting with its fan base is among the greatest casualties in its larger techno-drama.
Can Yahoo! make it in its current form? It’s not likely. Yet, Yahoo! must redefine itself and its mission if it is to survive (and be acquired). One thing is clear, however. The past does not matter. Without a clear defining story to tell the world, a story that communicates vision and focus, a company cannot own its future.
For my part, I still want to “Yahoo!” Let’s hope the company does, too.
Notes: I met Carol when I was running a service at Dataquest Gartner. ADSK was a client. I later consulted for ADSK. I was also at Excite.com managing search technology when Yahoo! was taking off. They were a “competitor” I greatly admired – although Excite had proprietary search technology; Yahoo! did NOT. I later did some consulting work for Yahoo! Thus, my perspective is certainly shaped by knowing people in this industry and being involved in it myself.