3 Key Factors Driving Yahoo’s Resurgence

July 23, 2013

3 Key Factors Driving Yahoo Resurgence

What are the key factors driving the Yahoo resurgence? Is it Marissa Mayer’s leadership? Or it is part of a broader change in strategy?

When you think of Yahoo, you’re likely to think of a company that has seen better days. Just over a year ago their last CEO was fired for lying on his resume, their stock was reeling, and rumors of their demise abounded in media articles.
But recently, their fortunes appear to be on the upswing. Their stock has risen appreciably, they’ve been active in M&A activity, and employee satisfaction is rising (see chart above).
So what are the keys to Yahoo’s turnaround?

1) The Marissa Mayer Factor

3 Key Factors Driving Yahoo Resurgence
Love her or hate her, Marissa Mayer is definitely changing things at Yahoo. She became a lighting rod for bad press when she revised the company’s Work from Home policy and compelled employees to come into the office. But given Yahoo’s moribund status, she pushed for change to get the company back into gear.
Great leaders are often polarizing, whether it be Jack Welch at GE, Alan Mulally at Ford, or the late Dr. Amar Bose, the founder of the Bose Corporation. All of these leaders had a clear-cut vision for their company, imposed their own corporate culture, and were unapologetic for doing things different. While Marissa Mayer is just getting started, she’s definitely instilling her own vision on the organization.

2) Focus on Keeping Core Products Relevant

Yahoo under Mayer’s leadership has redesigned many of its core products to give them a fresh look. A recent Washington Post article highlighted some of changes and their impact:
Since early in her Yahoo tenure, Mayer has redesigned many of Yahoo’s core products, including mail, search, and photo site Flickr, and killed off the search relic Altavista. In February, the site saw its first homepage makeover in four years — a change that doubtlessly contributed to a steady year-over-year increase in the amount of time people spend on the site, according to research firm comScore, and increased traffic on several Yahoo properties.

3) Focus on the Corporate Culture

As the graphic at the top of this blog shows, employee morale is improving. While some of the changes Mayer has brought haven’t been popular, she is leading a change in the corporate culture. Yahoo reports job applications are up and turnover is slowing down. Through its acquisitions of startups the company has also infused some new talent that brings a new perspective to the table.
Essentially every company needs strong leadership, with engaged employees embarking on a mission that they all feel has value. While the jury is still out on Yahoo’s turnaround, Marissa Mayer’s strategy appears to contain the ingredients of a successful turnaround.
What do you think? Is Yahoo on the way back up or are Mayer and Co. still not out of the woods?

Corporate Strategy, Sales Operations

Sudip is in charge of Corporate Strategy, Sales Operations at <a href="http://www.alegeus.com/">Alegeus Technologies</a>. Previously, he worked at OpenView from 2012 until 2014 with portfolio companies to provide insights on the markets they operate in, their customers, and drive development of business strategies.