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History of YAHOO!
Yahoo! began as a student hobby and evolved into a global brand that has changed the way people
communicate with each other, find and access information and purchase things. The two founders
of Yahoo!, David Filo and Jerry Yang, Ph.D. candidates in Electrical Engineering at Stanford
University, started their guide in a campus trailer in February 1994 as a way to keep track of their
personal interests on the Internet. Before long they were spending more time on their home-
brewed lists of favorite links than on their doctoral dissertations. Eventually, Jerry and David's lists
became too long and unwieldy, and they broke them out into categories. When the categories
became too full, they developed subcategories ... and the core concept behind Yahoo! was born.
The Web site started out as "Jerry and David's Guide to the World Wide Web" but eventually
received a new moniker with the help of a dictionary. The name Yahoo! is an acronym for "Yet
Another Hierarchical Officious Oracle," but Filo and Yang insist they selected the name because they
liked the general definition of a yahoo: "rude, unsophisticated, uncouth." Yahoo! itself first resided
on Yang's student workstation, "Akebono," while the software was lodged on Filo's computer,
"Konishiki" - both named after legendary sumo wrestlers.
Jerry and David soon found they were not alone in wanting a single place to find useful Web sites.
Before long, hundreds of people were accessing their guide from well beyond the Stanford trailer.
Word spread from friends to what quickly became a significant, loyal audience throughout the
closely-knit Internet community. Yahoo! celebrated its first million-hit day in the fall of 1994,
translating to almost 100 thousand unique visitors.
Due to the torrent of traffic and enthusiastic reception Yahoo! was receiving, the founders knew
they had a potential business on their hands. In March 1995, the pair incorporated the business and
met with dozens of Silicon Valley venture capitalists. They eventually came across Sequoia Capital,
the well-regarded firm whose most successful investments included Apple Computer, Atari, Oracle
and Cisco Systems. They agreed to fund Yahoo! in April 1995 with an initial investment of nearly $2
million. Realizing their new company had the potential to grow quickly, Jerry and David began to
shop for a management team. They secured a second round of funding in Fall 1995 from investors
Reuters Ltd. and Softbank. Yahoo! launched a highly-successful IPO in April 1996 with a total of 49
employees.
Today, Yahoo! Inc. is a leading global Internet communications, commerce and media company that
offers a comprehensive branded network of services to more than 345 million individuals each
month worldwide. As the first online navigational guide to the Web, www.yahoo.com is the leading
guide in terms of traffic, advertising, household and business user reach. Yahoo! is the No. 1 Internet
brand globally and reaches the largest audience worldwide. The company also provides online
business and enterprise services designed to enhance the productivity and Web presence of
Yahoo!'s clients. Yahoo! is more focused on keyword density and keywords in the URL and title tags
than other websites such as Google and MSN. The Yahoo Search index captures the full text of web
pages, which has a limit of 500K. Included in this 500K limit of text is a broad range of file types that
also appear in the web pages such as HTML, PDF, and Microsoft Office documents. To index
websites, Yahoo! uses a software program which has been given the term Robot Crawlers. The
specific robot crawler that Yahoo! uses in its search engine is called Yahoo! crawler, which is only
half as active as Googles robot crawler. The Yahoo! crawler attempts to understand how often
documents change. The more often documents are crawled, the more frequently documents are
changes. Although Yahoo! has not specified how big its index is, some research has been done to
determine Yahoo!s index size; one Yahoo search result reported more than 2.1 billion documents
found, which is only half as large as Googles index. Yahoo! also has an advanced search option,
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where one can specify and refine their search so that the results will be more accurate. Although this
option is offered by Yahoo!, it is quite difficult to actually find this search option as it is not on the
main page of Yahoo! Search. Yahoo also offers three paid inclusion programs, which are Inktomi,
Altavista, and AlltheWeb. Although all three have played an important role in assuring a broad range
of coverage for the search engine, the new Yahoo Search Index has only included Inktomis search
submit and index connect as the paid inclusion programs
Decline of YAHOO!
Thought there is no singular incident to which the failure of YAHOO! can be attributed, rather there
were a host of events, mismanagement and oversights which led to the decline of this once internet
giant. Numerous research, analyses and expert opinions show that yahoo was on the path of doom
since the year 1996 itself, as they were mostly concerned about money and milking their clients to
the maximum extent possible with lesser focus on quality and technology.
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Brand Equity
David Aaker said, Brand Equity is a result of Brand awareness, loyalty and brand
associations. Where Yahoo failed is Brand association.
Yahoo was never a technology leader. It was merely the first in the market. With Googles
emergence Yahoos downfall was inevitable, since Googles offering were technologically
superior and also captured the unstated needs of the growing inte rned audience. Yahoos
strength was its personal appeal, cheerfulness and wholesome look. These were also
getting dusty and hence Yahoo lost its lustre when competitors like Google and MSN began
to grow. Hence a rebranding effort was needed to build back t he lost glory of google, based
on its strengths of the personal appeal.
Brand Associations
1. Quality/Values Yahoo was slower in comparison to Google
2. Uses Smaller tools/services package as compared to Google
randE uity
wareness was there
L yalty Tec
l gy
s
isticati
ase
Ass ciati
s reasons for
Brand Failure
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Googles gamut of features are vast compared to Yahoo. But Yahoos catching up gradually. But the
impetus should be on focussing more on the available tools & core competencies like messenger,
finance tools, directory, Flickr etc. and enrich user experience through richer aesthetically more
appealing media.
Users Research by Hitwises Heather Hopkins
1. Yahoo Search users skew younger than Googles
2. Aspiring Contemporaries are over-indexed on Yahoo, whereas Affluent Suburbia is over-
indexed on Google.
3. According to Nielsen figures, Googles share of searches was 62%, compared with less than 18%
for Yahoo
4. Bottom-line : Google has a more varied set of users vis--vis Yahoo.
Organizational attributes
1. Yahoos a lot more conservative. Traditional investments, technologies while
Google is open, entrepreneurial & a laboratory
2. Here are figures from UBSs report on Yahoos & Googles hiring trendsa. Both are advertising for positions focused on video. Google is looking for online
video advertising, video advertising and search and television initiatives. Yahoos
focus for video seems to be on a better user experience, rich media and using video
throughout the network.
b. Yahoo is hiring folks for behavioural and geo-targeted ads.
c. 70 % of Yahoos open positions relate to operations and research and development,
up from 61 % a year ago.
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3 Botto -lin : Yahoohas ri h r media, for the lo ali ed, personali ed content vis- -vis
Goo
lestechie tools andspeed
hi
hfunctionalit
features
Br
d Perso
lit
as wasbefore t e It
s You Campaign
The proble with Yahoo was that itscore appeal of Sincerity!
& Excite ent which were the initial
brand associationss " ffered as they did not evolve with the growing industry # With respect to
competitors$ the industrystarted seeming dull and not powerfully positioned on anyspecific
personality- association. The Itsyou campaign had much revitalized the look of Yahoo and brough
back life into the brand.
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Whats requiredto Resonate with customers??
Voice of customers = Stated + unstated needs
1. Charming & cheerful2. Ease of usage3. Simple and clean user interface4. Relevant search5. ID space requirements
6. Speed
7. Suggestions and User-adaptive search
8. User friendly: Intuitive tools
9. Package of services: maps, analytics and docs, picture sharing etc.
The above 4 highlighted points were where Yahoo was strong and had its core value proposition.
These were lost as Google came in with both superior technology and also a fairly aesthetic appeal.
Yahoo lost out on all grounds and so began its decline.
Parameters Google Yahoo
Variety
More tools Many intuitive & user-friendly tools Fewer
Creativity
Creativity Ad campaigns using Ad Sense do better than
Yahoo Ads
Not as creative
Wholesome Minimalistic text
:Home-page less cluttered
Very cluttered
Brand elements not very
likable, memorable
Competence
Relevance of
search
More relevant
User Adaptive
searches
Related suggestions on Google None
Inbox Space and ID
variability
1 GB when launched and increasing 250 MB
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Lac%
ingcompetence Creativit&
Creativity is a verycrucial factor especially in the dot com business' where thesole purpose is to
attract and retain customers and users. Yahoo lagged far behind on this front than ( oogle' as it had
just one fixed look which it carried, where as(
oogle wasconstantly putting efforts to give the usersa new experienceeach day. This drove a lot of traffic towards ( oogle, drawing clients and
advertisers as well.
Man&
more toolsin Googlesboot&
andt) eyre FREE
An excerpt from a blog:
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Us: Yahoo maps sales called us up to tell us that our free 6 month
listing has been removed and if we wish to re-activate the listing, we have to pay.
Our response was as follows:
Us: But 0 listing on Google M 0 ps/Pl0 ces is free
Y01
oo M 0 ps: A1
yes, but t1
ere 0 re so m 0 ny fe 0 tures 0 v0 il0 ble 2 it1
Y01
oo M 0 ps Listings
Us: Yes, but Google M 0 ps/Pl0 ces listing is FREE 0 nd it1
0 s so m 0 ny fe 0 tures, not interested t1
0 nks
Y01
oo: But, bl0 de bl0 .
Us: Sorry, 2 ere not interested t1
0 nks needless to s 0 y 2 e1
ung up.
Furt1
er to t1
e p1
one c 0 ll 2 e delved into Y01
oo M0 ps 0 little to see 21
y 2 e s1
ould p 0 y for 0 listing.
Heres 21
0 t 2 e found out.T1
eres more fe 0 tures 0 nd 0 n 0 lytics tools 2 it1
Google Pl0 ces (0 nd its
FREE)
Goo3
les Simple and Clean4
s. Yahoos clutteredpage
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Rele5
ance of search & Reliability
Categories like Sports, Entertainment and Travel where richer media is required for viewers as the
audience wants more emotional appeal than functional appeal, Yahoo has a better share.
Yahoonotas competent:Search capabilities
Yahoos weakness was mainly the speed and relevance. Whereas Google also gave user adaptive
searches or suggestion to users which were a big attraction for the working class and those looking
for quick and relevant searchers. Yahoo hence needed to capitalize on the user category which were
looking for the fun, rich media look and not the functional usage and speed.
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Brand elements - Revitalized
Brand Elements
Name Yahoo
Logo/symbol Itsyou (purpleyvs. old)
Slogan Its You
Jingle (current) Yahoo~ooo~oooo
Likable?very
6 eaningful Yes
6 emorable? yes
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Segmentation Aspiring contemporaries
1. Yahoo is preferred by aspiring contemporaries, mostly the youth
2. Hence Yahoos marketing efforts and tools must be directed as to retain its youthy appeal
3. Yahoo must refine its search capabilities4. Build on its messenger, since that is very directly in-line with the personalization approach
a. Build using cultural and local content
5. Its not been known as a lab of geeky tools
a. And its hard to displace Google in some of its deeply established domains
6. The Its You campaign is directed exactly at this. A more sincere, exciting & personalized
Yahoo
a. The ads are heavy on images of dancers, Dalmatians, soccer and kids blowing
bubbles, and highlights the Internet companys array of services and customization
options
Sincerity & Excitementthrough Personalisation Yahoos Its You marketing campaign
1. Elisa Steele, the companys marketing chiefDont 7 e 8 ll just expect t9
e Web to be our o 7 n?
she said, explaining the idea behind the campaign. T9
8 ts 79
8 t consumers s 8 y t9
ey feel, 8 nd
t9
8 ts 79
8 t t9
ey7 8
nt more of.
2. The rebranding effort includes a modified version of Yahoos well-known yodel, new tag-lines
and the new campaign ends with one sung by a choir that ends with childrens laughter
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Competency: Tech E @ olution
y Leadership: Yahoo is trying to rope in the leaders of the industry to work for them. E.g.
Ask.coms CEO
y More user friendly
y Regional content and language
y More tools in the package
y Less cluttered, better web designs
y We suggest: Tie-ups with sites requiring search functions, still missing. Also sites where
personalized, local content like Mouthshut.com, city news etc. should be tied up with