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November 19, 2006

Can Peanut Butter Help Yahoo! Stop Shooting Itself In The Foot?

By Li Evans

Yahoologo Normally it's Google that has the blogosphere churning, but this weekend Yahoo!'s at the center of the bubbling cauldron of user generated content (ucg as blogging is being termed).  First it was firings, then it was voluntary "leaving", then acquisitions and then not acquisitions, and now leaked memos talking of peanut butter.  It is probably leaving a lot in the industry scratching their heads and wondering what the heck is up with Yahoo! and how long before its CEO, Terry Semel either addresses the issues publicly, voluntarily leaves or is ceremoniously booted to the curb for someone else.

Garlinghouse Probably the most damning of all the hub-bub going on right now is what's being dubbed by the Wall Street Journal as the "Peanut Butter Manifesto."  Yes, as bizarre as it sounds, a leaked internal memo written by Brad Garlinghouse, a senior VP at Yahoo!, has him comparing Yahoo!'s use of its internal resources to spreading peanut butter too thinly over a slice of bread.  Although only the insiders within Yahoo! can be the ones who can really attest to that, I found something further down in the memo that hit home.

Back in October, Yahoo! announced a new bookmarks tool, and that's when it really just hit me as I thought "But What About de.licio.us?"  I wasn't alone in that thought - Rand over at SEOMoz.org was thinking the same thing too, of course I had to ask him if he was reading my mind.  The point is, people were already starting to ask this question - "Why Does Yahoo! Compete With Itself?", maybe it's better stated as "Why Does Yahoo! Constantly Shoot Itself In The Foot?"  Garlinghouse goes on to point out the following internal Yahoo! competitions:

  • Shootyourfoot YME vs. Musicmatch
  • Flickr vs. Photos
  • YMG video vs. Search video
  • Deli.cio.us vs. myweb
  • Messenger and plug-ins vs. Sidebar and widgets
  • Social media vs. 360 and Groups
  • Front page vs. YMG
  • Global strategy from BU vs. Global strategy from Int'l

I'd compare a few different ones to each other, but I think the point is made that Yahoo!'s really got some identity issues it has to fix.  Those identity issues as a whole are probably the biggest factors holding it back from gaining any market share from Google.  With Google - you know its a Google product, and its rare that it does what Yahoo! has, where it makes acquisitions but doesn't integrate them as Yahoo! branded products.

The senior execs at Yahoo! would really benefit by taking a closer look at what Garlinghouse is  detailing - maybe if they stopped competing with own internal teams, it could pull it all together and actually truly compete with Google instead of themselves.

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Comments

This memo suggests that much more clarity is needed from Yahoo's CEO. It appears to be time for Terry Semel to retire and I would suggest that Susan Decker take over.

Jerry Yang and David Filo are critical at this crossroads for Yahoo!:

http://breakoutperformance.blogspot.com/2006/11/open-letter-to-jerry-yang-and-david.html

Cheers,

Eric

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