Mayer’s “jobs” road to revival
July 2012, only 37 age of Marissa Mayer (Marissa Mayer) as Yahoo company CEO, the has “Silicon Valley first beauty” of said of CEO in took office zhihou on Yahoo for has bold of reform, but company of development momentum is does not so and occurred fundamental of change, so radical investors began have on Mayer of led force said suspected, even mobilization its sold by holding some Ali shares, and and AOL seeks merged.
Times recently released has technology media Business Insider chief reporter nigulasi·kaersen (Nicholas Carlson) wrote of long articles save Yahoo: Mayer of “jobs type” revival of road, Carlson think, despite records save high of Mayer dedicated, and to when help Apple tide of jobs for example, but she in talent management experience aspects of lacks became its led Yahoo achieved revival of main obstacles. The following is the main content of the article.
Activist investor grievances
On July 21, 2014, Yahoo a long-term investor in the island resort of Georgia, a prominent hedge fund manager Eric Jackson (Eric Jackson) in Forbes published a column on the Web site, he does not look good again in the article Marissa Mayer (Marissa Mayer), carried out in-depth analysis of Yahoo. When Mayer as Yahoo’s CEO for two years, in the past two years, Mayer to overhaul Yahoo’s product architecture, and bought 41 startups, even hired a United States television news anchor Katie Couric (Katie Couric) as Yahoo’s global news anchor, specializing in exclusive interviews of celebrities and executives. But there was here a week ago, Mayer announced Yahoo’s worst quarterly results in nearly 10 years. But Jackson said in the article, current Yahoo is no longer necessary in the form of an independent entity in existence but seeking to be four technology giants (Apple, Facebook, Amazon and Google) acquisitions.
Jackson, this conclusion was not drawn from Yahoo’s disappointing quarterly results, but after extensive calculation results. Yahoo’s market capitalization was as low as US $ 33 billion, largely thanks to its holding of company shares. According to his estimates, Ali held Yahoo stock has a market value of $ 37 billion, so it seems, including Web sites, network products and content of Yahoo’s core assets, valued at $ 4 billion. Therefore a cash-rich company could consider buying Yahoo at this time, and then sell its Asian assets, and its core business into its own product lines, which will also allow Yahoo shareholders to earn a lot, even if it will destroy Yahoo, while Mayer to step down.
In Jackson’s article was published a day after he received an unusual message. This email comes from Yahoo’s major shareholders, he said in the letter, including his many Yahoo investors, as well as a large number of employees, and advertisers are very disappointed with Mayer, judging from the present situation, Mayer of Yahoo’s recovery plan clearly was a failure. Hosted by Mayer to buy start-ups (especially in 2013 for $ 1.1 billion acquisition of social blogging platform Tumblr) does not play a role in reforming business. Despite the many achievements of Mayer at Google, but came to Yahoo after they failed to make any Yahoo access to leading products in the field, coupled with its management made a series of wrong decisions, the large shareholders think the best outcome is to sell Yahoo.
On July 23, Jackson in Forbes published a follow-up article on the website, in which he sort of Yahoo shareholders ‘ views. This article then in United States investment community widely spread over the next several days, Jackson by answering several questions of Yahoo’s major shareholders, including large mutual funds and hedge funds, who encouraged Jackson to sell Yahoo’s views and actions. But Jackson’s mental treatment facility (Ironfire Capital) and do not have the capital to take a relatively aggressive strategy, for instance through large buying Yahoo shares to its internal management leverage pressure formed, but Jackson knows for sure there would be investors to sit still. Sure enough, the Starboard Value aggressive investment institutions Managing Director Geoffrey Smith (Jeffrey Smith) wrote to Mayer, urged Yahoo hands holding large amounts of cash buying AOL, but he also criticized Yahoo spend billions of dollars over the past two years acquired several Internet start-ups do not gain a significant return. Jackson after seeing Smith’s letter to telephone communication, both United States investment community celebrities on Yahoo’s prospects of reaching an agreement.
Jackson on the prompt market validation of Yahoo’s market value forecast. On September 19, Ali was successfully listed on the NYSE, closed at 93.89 dollars a share on the day. As Yahoo’s shares soaring value of our business, Yahoo’s share of the total market value is declining, verify before Jackson’s “core business of Yahoo’s value is negative” conclusion of the trend. A week later, Smith issued an open letter to Ali called on Yahoo to stock glass out, and return the proceeds to shareholders, then merged with AOL seeking. Such do will will in two home company among set off a unit layoffs tide, tens of thousands of people may will was CD off, both Zhijian compared similar of business (like news, and blog and electric mail, and map and weather, network products) will will was merged, “We believes Yahoo Board will for general shareholders made right of decision, even this may means with to accept was AOL merger of results,” Smith in letter in the wrote.
Although the likes of Facebook and Google lively, with strong profitability of Internet companies have always attracted people’s attention, but in fact there are many companies in Silicon Valley is doing the same thing year after year, such as the search engine Ask.com has been also could achieve $ 400 million in revenue a year. Mr Mayer, 39 two years ago will be Yahoo’s Board of Directors took is nothing that she can, with his iron-fisted Yahoo out of mire, but Mayer believes Yahoo can once again become a high-speed growth, with a large number of outstanding talents of top technology companies. In two years at the helm of Yahoo, Mayer himself and then save Apple’s Steve Jobs has been compared and stubbornness to adhere to his revival of the Yahoo plan. On October 21, Mayer released quarterly earnings exceeded analysts ‘ expectations, which also questioned a powerful response to Starboard of Mayer and Yahoo, but Mayer said in a conference call she “very have information to rejuvenate Yahoo’s business”.
Whether in the public or private occasions, Mayer’s determination to revive Yahoo is well-known, and she is also constantly emphasized that Yahoo is moving on the right track. Yahoo’s mobile business, although the scale is still small, but its revenue doubled last year; for example, despite the company’s display advertising revenue fell 6%, but sold out ad volume increased by 24%; Meanwhile Yahoo was attracted to mobile users has reached an unprecedented scale. Mayer did not comment on potential AOL acquisitions being judged because she aims to lead the company back to the top ranks of technology companies. “We believe in Yahoo’s future development potential,” she said, “now we are looking for a suitable opportunity to lead Yahoo back former glory. ”
Troubled Yahoo
In General, the pattern of success is not so much to make money via the Internet. Through the Amazon e-commerce profitability, through the platform Uber trading, and Apple hardware profits, but regardless of which company, in the final analysis are inseparable from advertising. Even such as Facebook and Twitter to be able to contact users directly to the companies, their main revenue is realized by selling advertising, similar to Hulu and profit model of Vox and other creative media company. Based on a search of Google, advertising is occupy a very important position in its revenues.
In fact was invented by Yahoo in online advertising. 1994, Stanford of two name graduate Yang and David Filo (David Filo) found has a can help early of Internet user browse page of method, they will himself like of some links (about has 100 a) finishing and released to a name for “Jerry and David of Web Guide” of website Shang, a years Hou, this website of classification reached has 19 a, day click volume also breakthrough 1 million times. In 1995, the company began selling online advertising, when industry insiders estimate the size of the market for only $ 20 million. In 1997, Yahoo’s advertising revenues had reached 70.4 million dollars the following year, that figure soared to 203 million dollars.
In order to maintain growth, Yahoo’s advertising product quickly overtook its category at that time, the company’s goal is for all Internet users and products, this strategy in the nearly 10 years that followed was a huge success. In 1997, Yahoo added chat rooms, classified ads, and e-mail and other services. In 1998, the increase in sports, games, calendar, file sharing, movies, real estate, shopping, auctions, and the address book service. Even during the Internet bubble of the late 90 ‘s, there are still a large number of traditional advertisers from print ads to online advertising, and Yahoo’s search business during this period of time also get rapid development. In 2002, Yahoo search results and advertising together, when the contractor receives us $ 953 million. In 2003, the company revenues exceeded 1.6 billion US dollars. In 2004, the revenue surge again to 3.5 billion dollars. Yahoo’s market value reached $ 128 billion in boom times the size of than Warren Buffett-controlled Berkshire? Sub company (Berkshire Hathaway) more than the market value of $ 20 billion.
However, this rapid growth masked a looming problem, when Yahoo is busy expanding the product, focus on carefully to create a product of start-ups is quietly emerging. Soon, the area lost to Yahoo Auctions eBay, lost out to Google in search, lost to Craigslist in information classification, while Facebook has replaced Yahoo as the millions of users of Internet browser home page. Yahoo’s ad revenue then plummeted during the 2007-2012 years, for four after CEO of Yahoo, including this last one CEO Scott Thompson (Scott Thompson) after just 5 months in Office resigned because of academic fraud problems at this time (May 2012) are worth less than $ 20 billion for Yahoo.
As a company supported by advertising, Yahoo’s method of improving revenues there are only two. First is attracting more and more customers are using its products, so as to enhance ad sales revenue, but it needs to create (or acquire) new products, improving or consolidating the old product. Then you can upgrade their content to increase advertising prices. Thompson later temporarily took over as Yahoo’s CEO Ross Levinsohn (Ross Levinsohn) believes that it is the best positioned to become a “premium” content providers. According to Peter Levinsohn’s vision, Yahoo has been in back-end technologies (such as real-time bidding and search ads) lags far behind competitors, so it’s best to give up the major portion of the business. If you do so, the company is also able to lay off 15,000 employees, more than half of, and put all his energy in the highest quality assets, that is, establish contacts with the users above. Month visits around 700 million when the company’s home page, this is the New York Times, the daily mail and the Washington Post, the three sites visited 7 times the sum of times. Peter Levinsohn that by providing them with better content, Yahoo’s revenue increased by 2 billion dollars within two years.
But in Silicon Valley, to be truly achieves fame and fortune but also upon the product cool enough, as compared with the content business, technology-based products easier for businesses to do large-scale, content business, after all, requires more manual labor involved in the expansion of scale can be achieved. This implementation also reflects a cultural bias in Silicon Valley, starting from HP, Silicon Valley’s leading companies have relied on technical intelligence based. How many executives at technology companies, while hiring engineers and designers very much at home, but not very good at hiring editors and content producer. When Loeb to join Yahoo’s Board of Directors later, he recruited former MTV President Michael Wolff (Michael j. Wolf), followed by two people on Yahoo’s next CEO candidate advisory noted venture capitalist Marc Andreessen (Marc Andreessen), Anderson’s suggestion they elected a product born of Gao Guanlai to this post.
Recruitment of Mayer
Loeb final decisions under the influence of other factors. Google’s market value at that time of US $ 250 million, while Facebook is worth $ 100 million, Loeb wished to proceed along the two Silicon Valley re-packaging the rookies look to Yahoo. So in the spring of 2012, Loeb and Wolfe began looking around for a CEO with a product background. This requires two Board Member Spencer Stuart consultants (Spencer Stuart) Executive-Search jimu·xitelin (Jim Citrin) contact the Palm menmeiyeer Google search engine user interface, Khitrin warned Mayer is one of 25 people when Google was founded in 1999, she’ll never leave Google. Also, when Google went public in 2004 and then, Mayer has earned hundreds of millions of dollars from them, so if not attractive job opportunities, she certainly is not taken into account. However, Khitrin said he will go to contact Mayer.
Khitrin didn’t know is that Mayer was very interested in having some kind of transformation. A few years ago, she lost an internal battle for a strength engineer, and was quietly assigned to be responsible for Google’s maps and other so-called local products. Mayer has tried to adopt a positive attitude towards the work of mobilizing, but company co-founder Larry page (Larry Page) return Google’s CEO, and Mayer after removed from executives of reporting to his, her situation has become considerably more difficult. Mayer’s friends said that Mayer was already concerned about Yahoo’s position vacant for several months now, so when Khitrin contact her, she bluntly said he was interested in the position.
Reposition the Yahoo development is certainly a big challenge, but the next CEO also has a very distinct advantage. In 2005, Yahoo, Alibaba to invest US $ 1 billion are in the development phase, obtained 40% shares, which became Yahoo’s history one of the most prescient bets. In the weeks before the June 2012 Mayer as CEO, Yahoo for $ 7.1 billion price it’s 40% half of the shares sold back to the company, as part of the deal, Alibaba agreed to IPO before the end of 2014, which also makes Yahoo overnight Wall Street investors hot objects.
Yahoo and Alibaba Group also pledged in the agreement reached in the next two years, Yahoo’s stock will no longer be bound in its core business, but is tied to the performance of Alibaba. For the incoming CEO, this is definitely a great news because it means that after two years in Office need not be too concerned about the company’s stock price, which was more focused on acquisitions by Mayer startups, driving product development and strategic change. In addition, she also take advantage of Alibaba cash in the next two years to achieve their vision of development plans. So when Khitrin suggested Yahoo CEO this post when she agreed to come down.
Leading technology companies realize a counter attack in the history of science and technology is a relatively rare occurrence. While the technology company has invented a new way of doing things, but with the continued expansion of the company, their personalities often vary, not to pay attention to those who can bring the subversive operations, but to protect those who are developing business, it also makes some financially strong venture capital-backed company has defeated conservative old new business opportunities. Of course, this “survival of the fittest” the cycle occurs in all industries, but faster in the technology industry. Jobs may has let Apple again station has up, IBM is will himself from a PC manufacturers into a home commercial advisory service company, and Xia a success of case is may will is Jeffrey Boyd (Jeffery Boyd) on C2B tourism service website Priceline of remodeling, despite it does not completely is industry of giant enterprise, Boyd on Priceline for has outright of again planning, including control on “user bid (name your Price) “policy advocacy, as well as the company’s main development strategy on the shift from air travel to hotel reservations.
Mayer’s revival plan
In order to get Yahoo back “products” list, Mayer tried to think of Yahoo as a massive start-up. On July 17, 2012, in Office buildings within several hours after she moved into the Yahoo, she used her computer to log in to the company’s code base to facilitate personally modify it, it looks like is the founder of a small tech company to do things. In the second week of taking office, Mayer has designed a program called “FYI” full weekly meetings, this meeting was held at the URL’s Cafe at Yahoo headquarters. Meanwhile, Meyer also tried to turn the company into a more flattering you like Office space. Yahoo’s employees at that time were limited to BlackBerry, but Mayer as iPhone and Samsung mobile phone company with mobile phone. URL’s to all employees free meals since then starts. In addition, there is one detail, Yahoo’s bathroom stall partition is not completely against the wall for years, you can hang up your toilet paper to cover the gap, Mayer soon after, shower and change up the new Division, showing degree of Mayer’s careful.
In a sense, Mayer sees her plan as a a return to Yahoo’s original mission. Yahoo’s popularity and market capitalization has increased in the late 90, is because it is the best Web site user experience. Mayer believes Yahoo can get on the Internet from the PC side user in the process of shifting to mobile, Yahoo’s mobile Web browsing experience is improved so as to attract more users. In other words, it needs to become a truly great company (app company). Mayer line of products from more than 100 companies reduced to under a dozen. She and the company’s Chief Marketing Officer, kaiqian·saweite (Kathy Savitt) after the conducted market research, found users often do things on a mobile device, Meyer turned her these things called “daily habit (Daily Habits)”, including the weather, read news, queries, such as reading e-mail and photo-sharing. Mayer was determined that in all of these areas can have the best of Yahoo mobile application.
To do this is obviously very difficult. Yahoo’s CEO did not previously invested too many resources in developing mobile applications, they are more concerned about advertising technology and Web tools for research and development. Meyer became CEO a few days later, one day she was having dinner at URL’s, an employee walked up to her and said: “I look forward to, the company’s mobile teams of engineers. ”
Mayer said at the time: “Hey Tony, how big is the current size of our mobile team? “After the iterated several times, Tony replied,” about 60 engineers. “Mayer had been struck by the end of this data. Take Facebook as an example, the company has thousands of persons engaged in work associated with the mobile terminal. When Mayer consulted the company’s Engineering Department and then get back to Yahoo there were around 100 mobile engineer, Mayer then asked: “is it true there are 100, still rounded into a 100-604 so I feel better? “It does later responded that the section is only about 60 engineers.
Companies like Facebook and Google were well known for fast-paced product update, while Yahoo has quite a lag in this respect. Yahoo’s email system to 30 billion messages a day, which is arguably the company’s most important product, but in desktop PC processing e-mails has decreased significantly as the number of cases, Yahoo also failed to launch for Smartphone and tablet devices mobile messaging applications, and simply do Yahoo mail websites can be used on the small screens of mobile phones. Today, Yahoo mail application is based on a visit four different mobile platforms like Android and iOS. With Gao Guanwei company responsible for mail and Messenger weike·xiaerma (Vivek Sharma) met for the first time, Mayer said she wanted to make this app can be released before the end of December, but she declined to comment.
Mayer subsequently devoted to Yahoo’s redesign. Months in Office, she regularly met with Sharma’s team in a conference room, the room looks like a Design Studio and projectors suspended from the ceiling, a screen cast on the wall, surrounded by dozens of pieces of foam core Board studded with everyone’s ideas. Meanwhile, Mayer periodically to ask the designer interface and user experience-related details. In early December, Yahoo mail applications published one day when she also Phish Food on the Yahoo Campus executive floor room had a meeting to discuss the subject of this application. Months research and development team has identified the use of blue and gray as primary colors, they think that if users view email on the phone every day, the best choice for some of the most difficult to cause users distracted contrasting tones. But Meyer said that she wants to change colour as the different levels of purple, she considered that the color theme color close to Yahoo’s brand.
Mayer announced that unless she can fully satisfied on the spot, or Yahoo will not release this product, some of the people in this room were encouraged, after all, if you can allow user modifications to a few pixels 0.01% increase in the number, then it will increase by millions of dollars in advertising revenue. But there are a lot of people showed a visible anger, according to a Yahoo executives who participate in the meeting, was Sharma’s body language let Mayer changed her address change requires time, Sharma was looking very weak. In order to change the theme color of this complex product, his team needed overnight resize thousands of local color, but in the end he had to wonder how hangdog gave his team the bad news.
Objectively speaking, Yahoo really needs to take more rapid action, and have 6-months-pregnant after Mayer takes over the post of CEO did set an example. She usually only 4 hours of sleep every night, and enjoys the fast pace of work. In the first six months in Office, she launched Yahoo’s Flickr photo sharing social networking sites new version, also on Yahoo’s homepage has been updated. Yahoo also released as new applications such as Yahoo and Yahoo Weather News Digest, but Mayer continues to strive for excellence, once again adjust Flickr and Yahoo’s home page. In addition, she also had to bid higher than Facebook’s social-networking light blogging Tumblr. Mayer in the first 3 months of taking office, Yahoo’s home page team has tested 5 new look, while Mayer within two months of taking office, she reviewed a total of 37 appearance prototypes.
Meanwhile, Meyer also said she hopes to improve the Yahoo search engine, in Google and this is what she is good at it. “I think Yahoo’s search engine market share should not be lower than 15%, this is where we share now,” she said in an “FYI” activities and employees said, “I think we have no reason not to return to the 20% of the market share. “According to a Yahoo Executive vomiting road, she told Vice President of the company’s 6, she hoped that before the end of the year saw a redesigned search product,” If you can do that, just tell me, “she said at the time that” If you can’t do that, I went to look for people who can do it. ”
In Mayer just in the first few months of taking office, the media response has been generally positive, this is to a large extent associated with her age and experience at Google. Technology media ReadWrite prominent journalists Dan·fuluomo (Dan Frommer) said in an article: “Yahoo who for many years have been mediocre, hired Mayer is a good move. “But by early 2013, that is, Mayer took office about six months, her recovery plan seemed to have worked. In March of that year, Yahoo’s shares rose to $ 22 a share, while Mayer was also added to the company’s intranet a tool that lets employees could see their stock compensation.
In April 2013 and every Board meeting, Meyer admits that she does not bring a Yahoo “breakthrough product,” but she cautioned that jobs was until the second time in 5 years after Apple as CEO, was born the idea of developing iPod. In that segment time of once “FYI” activities Shang, she to here of hundreds of bit employees reading has a jobs in began revival Apple Shi published of a incentive speaks, “we of target is encourages and please we of user, build out excellent of service and products, let people daily are can enjoy to using they of fun, this is we of opportunities where,” Mayer said, “we is world Shang maximum of venture company, we annually has 5 billion dollars of income, but if we cannot do himself of work, These moments will vanish. ”
Mayer at Google is an Executive in a dedicated product appearance and mode of operation, as to how to rely on profitable products, she’s really not good at it. After coming to Yahoo, she was going to do the most important job is to find who can help her figure out the problem, while also managing Yahoo over more than 1000 person sales team. Mayer did not look for too long, as Yahoo’s CEO a few weeks later, she received the henglike·dekasiteluo (Henrique de Castro) messages. Noli de Castro was head of Google’s Vice President of media, mobile and platform operations, as well as an often quite decent clean Portugal people when he asked Mayer had no time for dinner and to recommend a restaurant, Mayer finally chose a restaurant that is more secluded, specially in the booking of seats in place.
Noli de Castro during dinner with his knowledge of Yahoo’s business and specific recommendations for the number of high feasibility impressed Meyer. Over the next few mornings, two men negotiated a salary of noli de Castro by mail. Every night, Mayer gave a price, the next morning, she receives a list more terms reply, and eventually the two sides hammered out a contract about $ 60 million, while contract prices will fluctuate as Yahoo’s stock price. Stunned by Yahoo’s Board of Directors on such a high level of personal emoluments, but Meyer, noli de Castro gave up his Google does not take ownership of the stock, in Yahoo that he should be compensated. But she believes that noli de Castro Yahoo made several times his salary in return.