Scott Thompson, Yahoo!: E-Commerce is the New Content, Yahoo! is the Newest Startup
It seems that most of the mainstream press is befuddled about him and exactly what business Yahoo! is trying to be. Is it a media company? Is it a bulletin boards company? Advertising? Mobile? Marketing? No, not search.
It is a company that has a rapidly scalable identity and a huge community of users that it can rapid test ideas on, as it builds off what it used to be and turns into the next big thing.
This makes Yahoo! just like a start-up, and Thompson just like a budding entrepreneur, except he has skillz. Let me boldly proclaim that Thompson’s role as CEO at Yahoo! will move the company in the direction of social, community-centric e-commerce solutions. Watch out, Jack Ma, Yahoo! is coming for you!
Yahoo! is going to become the first huge scale media content company that is actually an e-commerce company. Think of it as a giant tupperware party where content and e-commerce are mashed together to form a new type of selling content, or a live advertising model where product, seller, consumer, and community are all mashed up into one.
Wal-Mart, but with a huge media engine.
Because I think of things differently, and can’t always depend on people understanding what I am saying, I asked the question to the Quora community — Will the Scott Thompson hire move Yahoo! towards e-commerce and away from content?
Here’s what Edgar Alverson, a writer in Atlanta, said:
Yes. Or at least that certainly seems like what the board wants. I think Thompson’s background and the fact that he was selected at this juncture indicates that his mandate is to move Yahoo! toward e-commerce and away from content.
I think Yahoo! will continue to generate a great deal of content, but Thompson will be tasked to streamline it and focus on the strengths. I, like many of Americans in my younger male demographic, see Yahoo! as an ESPN alternative. It has a decent syndicated sports radio network, excellent sports fantasy hosting capabilities and lots of unique sports content. I doubt Yahoo! backs off on its press to compete with ESPN, and I’m actually surprised that it has not started broadcasting games on the web like ESPN3. However, less successful Yahoo! content ventures (and maybe even sports) will quickly disappear under Thompson.
Some of the most interesting companies today operate from a community-first approach. They take a gap in an existing market, and seeing the deficiencies that market leaders in that market experience in trying to scale their already swollen business model, they jump at the chance to do an end-around, inviting people to be greater and more prolific consumers of that economy through participation as a community.
In a world that is rapidly turning mobile, where companies are growing up around communities, and where traditional forms of payment like credit cards are losing out to mobile and e-commerce solutions, Yahoo!, a huge content and advertising engine, could be set to make a pivot towards being a kind of consumer-generated social e-commerce solution.
Look At Precedent
Airbnb is a huge success in this model. They figured out that the same people who might be wanting to rent a place to stay smoewhere in some city might also be the same peole willing to make more money on their current residence.
Instagram has done this too. Instead of trying to come up with a new camera technology, they decided they arlready knew one thing about camera consumers. They like to take photographs. So, let’s make it easy for a community to form around the avid interest to take great shots, and forget the camera. Just use the phone. The same phone you can use to track, link to and engage with a community.
Do I need to go on?
Look at Fivver, where communities are formed around doing work for five bucks, where many of those people go on to be individually-run companies that hire out their services based on their interaction in a community that consumes their content.
Look at Soluto, which is trying to put the social into the world’s most anti-social profession, IT.
Sales depends on the growth of emotional discovery. Companies that enable this growth enable more sales. It’s the backbone of the Social CRM model being espoused by people like Jon Ferrara, the founder of GoldMine and his newest venture, Nimble. Nimble just got $1 million in funding in an investment round headed by lead investor Mark Cuban.
Where Does This Context Leave Yahoo!
I’d say it leaves them at a great starting off point. E-commerce is the new content.
And content will feed the consumers hungry to do commerce on the phone.
Look at the numbers for Yahoo! in Indonesia, one of the fastest growing mobile audiences on earth, and the country with some of the most prolific social media users through the smartphone.
And in Singapore
|Yahoo! users (P7D)|
45 and above
University & above
|Household income (US$)||$999 & below
$5000 & above
|With/without children||Married with children
Married w/out children
|Personal income* (US$)||Below $999
$5000 & above
Yahoo! have a younger audience, growing in income, who want media. They have a community that is global.
They have a wickedly smart CIO / CEO / CTO hybrid in Thompson, who can help the company rapidly innovate and pitch out new products and service suites to millions of people. Imagine split testing all of that stuff, and then incorporating that knowledge of e-commerce Thompson brings.
I’ll let you think about that for a moment.
All Yahoo! has to do is convince the talent that has stayed to believe in themselves as entrepreneurs, and then bring in e-commerce MVPs that enable people to sell to one another. Maybe they get into a partnership with Square. Maybe they team up with American Express. Maybe they team up with Foursquare. Whatever they do, they feed on existing technologies and communities that will expand their ability to grow in e-commerce at scale.
Yahoo!, Where Every Consumer is the Home Shopping Network
I give this company 18 months, and in 18 months, they will be a new kind of social shopping giant. You’ll wonder what hit Yahoo!
And in closing, keep in mind what current Yahoo! employee and Quora user Gil Yehuda says about Thompson’s character:
I’m sure he was not hired on charisma alone. He has a track record of success. And he led his last organization to compete against some of the largest, oldest, most entrenched, and heavily funded companies in the world. That took guts and a team of people who thought outside the box, delivered fast, and kept customers happy by delivering great products that worked well, internationally, and at internet scale. He lacks certain key experience in some of the most important aspects of Yahoo!’s business. This means that he’s going to have to rely upon the existing senior leadership for their experience. And he’ll be in learning mode. In a sense this is a good thing, it will ensure some degree of continuity in the second and third levels of management. And yet, I don’t expect his first “100 days” to be quiet or uneventful either. As they say: “Always expect change, expect from a vending machine.”
The most successful entrepreneurs have always been the ones who didn’t know enough to worry, and who knew enough about their vision to care.
This is Thompson. Yahoo! is about to be the perfect storm.