Yahoo! is in the news a lot lately—most recently for CEO Scott Thompson’s résumé lie—but what I find interesting about Yahoo! is actually much bigger than that. I’ve found that when you ask people, “What unique advantage does Yahoo! give you?”, most people don’t know how to respond. They know what Yahoo! was back in the 1990s—they were the king of search and later display ads. But why would you choose to use Yahoo! instead of Google or Microsoft today? Few people know anymore.
We hear today how Facebook has over 900 million users. But if we go back in time to 2005, we can see that Yahoo! had over 500 million people in their on-line groups according to former Yahoo! executives I have talked to. This was a goldmine Yahoo! never mined and something that could have defined who they are today.
For example, in 2005 I was working with a company that had a sports drink they were going to launch. The benefit of their sports drink, they claimed, was rapid recovery from physical exercise. They were going to do a national television ad campaign.
I asked, “What percent of all of the people watching that television ad are going to be interested in rapid recovery from exercise?” Of course, the percentage was small, but it was still a good number.
I then asked if they knew about “electronic communities of interest.” They didn’t, so I explained. An electronic community of interest (like a Yahoo! group) is a very focused group of people who are passionately sharing their interest on a particular topic, such as sailboats, 1959 Corvettes, cameras, etc.
Since Yahoo! had over 500 million people in thousands of on-line groups, I asked the sports drink company executives, “Out of all of the Yahoo! groups out there, with thousands of members in each one of those communities of interest, how many e-communities are there for triathlons?” Of course, they didn’t know. But I knew the answer. In 2005, there were 1,072 triathlon e-communities in Yahoo!, with hundreds of members each—and in some cases, thousands—talking and posting pictures about their triathlons because they were passionate about it.
I continued, “If rapid recovery from physical exertion is your benefit, what percent of those triathlon groups would be interested in your product?” Of course, the answer was simple: 100%. “Now, let’s add up a few more groups within Yahoo!. How about baseball, football, basketball, running, volleyball?” Pretty soon we had over 30 million people that would be 100% interested in their product identified, and an easy way to reach them through those groups.
It doesn’t take a marketing genius to see that there’s a goldmine here. Yet Yahoo! has never cashed in on that and never worked at doing it in an efficient and effective way.
No wonder today so few people know what unique value Yahoo! offers. In fact, most people don’t know much about Yahoo! groups, yet they’re still huge and active to this day. I’m even a member of a Yahoo! group right now that has hundreds of members, and I get good value from it. Chances are you’re a member of a Yahoo! group too.
Yahoo! is proof that if you’re not focused on finding and discovering the hidden value of your company, the invisible goldmine that will give birth do many new cash cows, but instead your just continuing to milk your old cash cows, you’ll end up floundering to the point where customers and consumers will simply move on to a more relevant company. It’s time for Yahoo!, Blackberry, Blockbuster, the entire music industry, and all of the cable companies, and many more, to dig a little deeper into their own company and discover the hidden value that will accelerate growth now and in the future.