Bartz Buying the Wrong Kool-Aid

Last Updated Sep 24, 2009 8:14 AM EDT

So Yahoo is bringing a $100 million advertising campaign to Y!ou. But the attempt at rebranding recreates a classic strategic mistake and has the company buying into its sometimes questionable negative reputation.

As my colleague David Weir at BNET Media said, the campaign seems as much aimed at convincing Yahoo of its worth as it does of convincing consumers. But I have to disagree with David on one point. He says that Yahoo's share of Internet usage "has been stagnant for the past three years" and that "the likes of Google and Facebook flourished." That observation is simply wrong. Look at these U.S. usage numbers (unfortunately, I don't have access to global numbers) from Compete.com:

Yes, Yahoo has slipped a bit the last few months, but there is an overall close parallel between it and Google. When you've got as large an audience as these companies, high growth simply isn't going to happen. They're already at about a third of the entire country. And even at that, over roughly the last year alone, Yahoo's monthly unique visitors have gone up 8.6 percent.

I've noticed at times in the past that Wall Street tends to get particularly dour when it comes to Yahoo, even if the company's fundamental financials aren't all that bad. Granted, there have been plenty of problems in strategic focus and execution at the company. But rather than the Golden Kid who can do no wrong, Yahoo has become the Brass Kid who could do no right.

The problem it now faces is that Carol Bartz, coming from the outside, wants to be the conquering CEO, as new chief executives tend to do, to prove her own worth. Rather than taking the somewhat longer road of understanding what customers really want and making any necessary adjustments to Yahoo's operations, she's going down the road of rebranding.

Can spending $100 million do any good? Microsoft seems to have made some progress in getting Bing accepted as well as pushing back against Apple with large ad spends. But those were tactical. Large rebranding efforts are often like massive reorganizations: a last refuge for those who are trying to paint a pretty picture. And if you're suffering from a bout of self-loathing, no picture is going to be pretty enough.

Image via Flickr user P/UL, CC 2.0.
  • Erik Sherman On Twitter»

    Erik Sherman is a widely published writer and editor who also does select ghosting and corporate work. The views expressed in this column belong to Sherman and do not represent the views of CBS Interactive. Follow him on Twitter at @ErikSherman or on Facebook.

Comments