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Yahoo?: Business on Internet Time. By. Girotte and Rivkin. Timing is now everything ... classified Web sites like libraries classify books (Yahoo! & Excite) ...

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Presentation Transcript
timing is now everything
Timing is now everything
  • What is the difference between strategy and tactics in Internet time?
  • Strategy used to be long term, maybe 3 to 5 years. Can you keep a strategy that long when competition changes their offerings weekly or monthly?
competitive landscape
Competitive Landscape
  • @Home acquires Excite (Yahoo!’s arch rival)
    • Offered high-speed cable access to the Internet
  • AOL acquired Netscape
    • Netscape owned a browser
    • Netcenter was popular portal
  • Disney took stake in Infoseek
  • NBC allied with SNAP
  • Lycos was in merger talks
when do you change strategy
When do you change strategy?
  • When KSFs change.
  • When customer requirements change.
  • When competitive requirements change.
  • When other assumptions/requirments change.
yahoo s strategy
Yahoo!’s Strategy
  • Provide one-stop access to anything that someone might need.
    • Find anything
    • Locate anyone
    • Buy anything
  • Generate revenue from advertising and deliver users to vendors’ sites.
internet the www
Internet & the WWW
  • Started by DoD for military and its vendors in 1960s.
  • HTML standard set in 1991 for describing computer documents.
  • Browser developed in 1994 by James Clark (Netscape founder).
  • By 1999, 100 million Internet users, and 43 million host computers & 367 million PCs on the Web.
portals
Portals

“Second most meaningless word in Netspeak”

  • Search engine spiders found latest Web sites (Lycos, Infoseek & Alta Vista).
  • Navigation sites classified Web sites like libraries classify books (Yahoo! & Excite).
    • News, sports, stocks.
    • Email and personal home pages
    • Auctions, shopping, financial services.
    • Chat rooms and communities
portal customers
Portal Customers
  • Non-paying users of Portals (48% men, 34% women, 18% children).
    • Searching
    • Communicating
    • Exploring
  • Corporations paying to attract sale of products and services (display ads or links).
    • $2 billion in 1998 (52% through portals)
    • $5 to $200, main page vs targeted placement
    • 2% to 30% referral fees
portal suppliers
Portal Suppliers
  • Information providers, like news, get monthly fees ($2,500 to $20,000)
  • Advertising media (50% of revenues spent to build brand awareness)
  • Labor ($100,000 to $200,000 for programmers)
  • Technology for financial transactions, email and instant messaging, & home page development tools.
leading portals
Leading Portals

Yahoo!

AOL.com

Excite

MSN

Lycos

Infoseek

Netcenter

Snap

  • Access
  • Providers:
  • Broadband
  • (Media One, @Home)
  • Dial-up
  • (AOL, AT&T Worldnet)
  • Wireless
  • Direct at Work

Customers

Require:

PC

Modem

Subscription

  • Vertical Sites:
  • Techn news
  • (CNET, ZDNet)
  • Sports
  • (ESPN)
  • Personal finance
  • (Quicken.com)
  • Mass Content:
  • 43 million connected computers

Set default

Portal

Other

Sites

Subscribe to

Access Provider

Go to Vertical

Site of interest

Consumer buy PC

& modem

yahoo results
Yahoo! Results
  • Bring people together for content, commerce, communications, and community offerings.
  • My Yahoo! With tailored ads, chat rooms, and news wires.
  • Country specific portals.
  • 167 million page views per day in 12/98.
  • 50 million viewers
  • 2,225 companies buying ads
yahoo properties common look and feel
Yahoo! Properties Common look and feel
  • Navigation properties to find relevant information (categories of information).
  • Community properties to facilitate contacts and communication (address book, email, chats, message boards).
  • Personalization properties (MyYahoo! for personal links).
  • Electronic Commerce Properties (shop, travel, real estate)
  • International properties (local language and sites)
yahoo operations
Yahoo! Operations
  • Tight space helps communication and keeps costs down.
  • Organization (Exhibit 11) by expertise
    • Property development: (Production, Engineering, Surfing)
    • Marketing and Sales: (Business development, Brand marketing, Sales)
    • International
  • Partnerships for distribution (like AT&T WorldNet, E*Trade, NPR, Fox sports)
yahoo planning
Yahoo! Planning
  • Stay 60 days “ahead of the competition”
competition exhibits 13 14
Competition (Exhibits 13 & 14)
  • Access and Content Providers
    • AOL/Netscape has largest captive market of 14 million subscribers (Netscape had been late to set up a Portal)
    • MSN (2 million subscribers) imitates AOL (deal between AOL to use IE as default, for AOL on desktop)
    • @Home/Excite (330,000 subscribers) accessed 19 cable providers passing 60 million homes
competition
Competition
  • Portals with Media Partners
    • Disney/Infoseek were 8th and 9th most popular sites.
    • NBC/Snap accessed CNET, MSNBC and CNBC.
  • Independent Portals
    • Lycos Network with HotBot search engine
    • AltaVista takes DEC’s search engine public
what future actions exhibit 13
What future actions? (Exhibit 13)
  • What new partners? Suppliers? Customers?
  • What new features?
  • What content providers?
  • What capabilities? Security? Transactions?
  • What acquisitions?
  • What income streams?

What future strategy? When will you know it?