How Yahoo can regain its lost relevance in mobile

The ouster of CEO Carol Bartz last week punctuated a disappointing couple of years for Yahoo, and nowhere is that disappointment more glaring than in mobile. Yahoo’s presence has waned as the iPhone and Android have fueled a surge in mobile data consumption. Meanwhile, Yahoo’s traffic on the fixed-line web in the U.S. is second only to Google, according to ComScore, drawing 178 million unique users in June alone. The company is missing out on a huge opportunity to convert its traditional users to mobile users.

But there’s still time for Yahoo to regain its lost relevance, because our appetite for mobile data will continue to ramp up dramatically in the next few years. That increased demand will need increased supply of content, applications and services. Yahoo’s online traffic and content could be potent weapons in mobile if the company were to focus on a few key areas.

The web

Browsing Yahoo’s mobile site is like walking into a Wal-Mart store: It’s overwhelming, confusing and difficult to browse. There’s simply too much content to be presented immediately on a mobile phone, where less is often more. Instead of trying to duplicate the desktop experience, Yahoo should take a page from Costco’s playbook and present a few broad topics on its mobile home page — news, messaging and social networks, for instance — and enable users to drill down for more information.

Apps

Yahoo has developed a wide variety of apps for the iPhone and Android devices, but it’s done a poor job of marketing those apps online. I’ve played fantasy baseball in a Yahoo league for years, but I have never noticed an ad for its fantasy baseball mobile app. That’s a big reason apps from Facebook, Skype and the Weather Channel are so popular among iPhone and Android users, while Yahoo’s offerings are nowhere to be seen.

There are other ways Yahoo could tap the booming mobile app space, also: It should add some long-overdue innovative new mobile features to Flickr, such as the optical effects and social integration that have made Instagram so popular. And while Yahoo has teamed with Appolicious to help gamers and other mobile users find what they’re looking for in Android Market, it could follow Amazon’s lead and build its own app store for Android games. That would not only build Yahoo’s brand for mobile and online gamers but also create an entirely new revenue stream.

Local mobile advertising

While Google and Apple have aggressively pursued the growing mobile-ad market through blockbuster acquisitions of vast ad networks, Yahoo has largely been content to sell ads only on its own mobile properties. But Yahoo has built an impressive database through its Yahoo Local Listings, which helps online users find what they’re looking for nearby. Yahoo should leverage that by developing a local ad network, just as WHERE and several competitors are doing. That ad network could deliver location-aware, highly targeted ads to users as they search on their phones. Those kinds of ads will become highly lucrative as mobile search takes flight.

Yahoo has paid little attention to mobile over the past few years, and there’s not many reasons to believe the company will step up its game now. But our world is an increasingly mobile one, and mobile connections are expected to outnumber fixed-line connections by 2015. Yahoo’s prospects hinge on mobile, not the fixed-line web. If it moves aggressively, it could ramp up its mobile traffic — and its mobile ad dollars — in a big way. If it doesn’t, it will continue to lose ground while the Apples and the Googles of the world dominate.

Question of the week

Can Yahoo regain its lost relevance in mobile?
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Colin Gibbs

Colin Gibbs

Mobile Curator Gigaom Network

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2 Comments Subscribers to comment
  1. The note about Yahoo paying little attention to mobile recently misses out on an important development – the announced partnership between Yahoo and Mediatek to provide integrated Yahoo content offerings on Mediatek chipset-powered mobile devices.

    The market opportunity this partnership aims to tap is, to say the least, huge, considering the emerging markets Mediatek already has a presence in.

  2. Thanks for the comment, Manish. You’re right that the MediaTek deal shows promise considering the company’s presence in emerging markets. But if Yahoo is going to regain its lost relevance worldwide, it must find a way to tap smartphone users in more advanced markets, too.

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