SWOT analysis of Yahoo
This detailed SWOT analysis of Yahoo aims to provide the readers with a comprehensive insight into the strengths and the weaknesses of Yahoo. It also aims to examine the opportunities the company should explore and the threats it should keep an eye on. Yahoo is a global Internet services provider based in California, the USA. It was founded by Jerry Yang and David Filo in 1994. Both founders were graduate students of Stanford University – one of the best and most recognised universities in the world. Yahoo stands for ‘Yet Another Hierarchically Organized Oracle’.
Strengths of Yahoo
Yahoo is one of the greatest names in the world of the Internet. It was in fact one of the pioneers in the early Internet era in the 1990s and has provided some brilliant services. Perhaps most people would know Yahoo for its web portal, search engine (Yahoo! Search), Yahoo! Directory, Yahoo! Mail, Yahoo! News, Yahoo! Groups, Yahoo! Answers, online mapping (Yahoo! Maps), video sharing (Yahoo! Video), and advertising services. Verizon Communications (US telecom giant) bought Yahoo in 2016 with approximately $4.8bn in cash.
Yahoo Mail is available in 46 languages and 70 markets. It has 227.8 million monthly active users with around 26 billion emails sent daily. In 2018, Yahoo introduced two new versions of Yahoo Mail, optimised for mobile web and an app for Android Go (Lunden, 2018). It has been providing unlimited storage for its email services since May 2007.
Yahoo is one of the most widely read news and media websites. It is also the 2nd most popular search engine in the world. As of May 2019, it has 8.35% search engine market share in the USA, and 1.72% in the United Kingdom. Its global market share is 2.67% (StatCounter, 2019). Yahoo also ranks 9th in global Internet engagement with 458,999 sites linked to it (Alexa Internet, 2019).
Weaknesses of Yahoo
Yahoo has failed to protect its users’ accounts and data at least in two big occasions. For instance, the personal data of 500 million user accounts worldwide was hacked by a cyber attack in 2014. The stolen data included names, email addresses, telephone numbers, passwords and encrypted security questions and answers (Gibbs, 2018). The same hacking affected more than 515,000 UK email accounts. Yahoo was also attacked by a far greater hacking in 2013 which affected approximately 1 billion accounts. What perhaps shocked most people is that Yahoo did not disclose these breaches until 2016. It is worth mentioning that Yahoo was fined £250,000 over the hack in 2014 by the Information Commissioner’s Office in the United Kingdom.
Yahoo has been struggling financially for the last few years. For instance, it made net loss of $4.4 billion in 2015 (BBC, 2016). Weak financial position is perhaps the main reason as to why Yahoo decided to be taken over by Verizon Communications. Interestingly, Yahoo valued at $125 billion in 2000 and it turned down Microsoft’s $44.6bn offer in 2008.
Opportunities for Yahoo
Yahoo can explore many different opportunities for growth that are available out there. For instance, its Android Go can help Yahoo Mail grow among new categories of users as it is a version of Android that targets specifically cheaper handsets. It is widely observed that many people now-a-days use lower-end devices in both developed and emerging countries; hence good opportunities for Android Go!
As mentioned above Yahoo is the 2nd largest search engine in the world. However, Google is the global market leader with 92.04% % market share (StatCounter, 2019). Yahoo has great opportunities to gain more search engine market share in global arenas. Likewise, introducing new services is also worth exploring.
Threats to Yahoo
Threat is the last element to explore in the SWOT analysis of Yahoo. Yahoo has a number of competitors in the industries in which it operates. For instance, Google dominates the search engine industry with an iron fist with 92.04% global market share. However, combined efforts of both Yahoo and Bing are likely to put considerable pressure on Google. Other major competitors of Yahoo in this industry are Baidu, Yandex RU, and DuckDuckGo.
Yahoo Mail competes with a number of free email providers. Gmail, Zoho Mail, Outlook.com, Mail.com, GMX, Yandex.Mail, Tutanota, iCloud Mail, and ProtonMail are some of the most popular email providers in the world. Yahoo also faces some powerful competitors in the field of advertising. The advertising industry was once dominated by Yahoo; however, it has already been overtaken by social networking sites such as Facebook.
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Last update: 21 June 2019
Alexa Internet (2019) yahoo.com Competitive Analysis, Marketing Mix and Traffic, available at: https://www.alexa.com/siteinfo/yahoo.com (10 June 2019)
BBC (2016) Yahoo sold to US telecoms giant Verizon, available at: https://www.bbc.co.uk/news/business-36879831 (accessed 01 June 2018)
Encyclopædia Britannica (2019) Yahoo, available at: https://www.britannica.com/topic/Yahoo-Inc (accessed 16 June 2019)
Gibs, S. (2018) Yahoo fined £250,000 for hack that impacted 515,000 UK accounts, available at: https://www.theguardian.com/technology/2018/jun/12/yahoo-fined-hack-ico-uk-accounts-russia (accused 17 June 2019)
Lunden, I. (2018) Yahoo Mail aims at emerging markets and casual users, launches versions for mobile web and Android Go, available at: https://techcrunch.com/2018/06/19/yahoo-mail-go/ (17 June 2019)
StatCounter (2019) Search Engine Market Share Worldwide, available at: http://gs.statcounter.com/search-engine-market-share (accessed 18 June 2019)
Photo credit: Pixabay
Author: M Rahman
M Rahman writes extensively online with an emphasis on business management, marketing, and tourism. He is a lecturer in Management and Marketing. He is a graduate of Leeds Metropolitan University and London South Bank University.