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Yahoo reveals a glitzy array of new content and advertising plans, but can they succeed?

Yahoo threw in everything but the kitchen sink in its hour long keynote at CES 2014 yesterday. Led by CEO Marissa Mayer, the company outlined its plans for the new year and highlighted its efforts in transforming into a full fledged media company.

You can watch the entire keynote here:


Bigger, better Yahoo content

It was clear that Yahoo’s new approach would be driven by creating more engaging content for users, and making it easier and more lucrative for brands to advertise with it. On the content side, Yahoo had already acquired the services of some big name media personalities last year, including tech writer David Pogue of the New York Times, and of course Katie Couric, who will serve as the company’s global anchor. Yesterday, Yahoo finally told us what they will be doing.

Pogue will head a new Yahoo tech news vertical, part of Yahoo Digital Magazines, which are Tumblr-powered sections of Yahoo news. Another vertical expected to launch soon is Yahoo Food. Both the digital magazines will be utilizing photos from Flickr, which is a nice way for Yahoo to integrate its properties.  

Speaking of integrating properties, remember that 18-year-old wunderkind who sold his app to Yahoo for $30 million? Summly’s Nick D’Aloisio joined Mayer on stage to announce Yahoo News Digest, Yahoo’s version of a twice-a-day newsletter, which summarizes the day’s top stories from multiple news categories.

A new, unified advertising solution and native Tumblr ads

It was a surprise to see Tumblr founder and CEO David Karp take the stage to extol the virtues of ads on his social network, something he had been loathe to introduce to Tumblr. It looks like the economics couldn’t be ignored any longer. Karp talked about how Tumblr will now have native ads, in the form of sponsored posts. Advertisers can create these using the new and improved Yahoo Advertising service, which will give them extended capabilities in targeting audiences by gender, location and personal tastes. Here’s the full range of Yahoo’s new advertising services:

  • Tumblr Sponsored Posts powered by Yahoo Advertising
  • Yahoo Audience Ads — a better way to buy ads targeted to specific audiences
  • Yahoo Ad Manager and Ad Manager Plus — a new buying platform that gives advertisers direct, hands-on access to Yahoo’s advertising products
  • Yahoo Ad Exchange — a new global ad marketplace that provides premium publishers with more visibility and control over advertising on their sites.

Will it work?

There are plenty of new features to attract the ever-important attention of advertisers, plus Yahoo has the premium content to back it up. But is it enough?

On the content side at least, Yahoo has always been a strong player, with its news, sports and finance verticals getting plenty of traffic. Now with Couric and Pogue, it’s got some big name personalities – who are also video specialists- to give the platform exclusive, engaging content. Unlike Facebook, Google, LinkedIn or Twitter, Yahoo is the one big tech company that makes its own content, which is a huge advantage. It now also has the technology to bring the right content to the right user, through its audience targeting service. Putting all of this together means Yahoo has the potential to be the biggest, most successful media property yet.

The big concern of course is revenue. So far, Yahoo’s ad exchange platforms haven’t been spectacular, with Kara Swisher of Re/code remarking that even AOL offered better products. It will be a challenge to pivot the ad revenues from its core products such as search, to its new content focused plan. Tellingly, the new digital magazines were without any display ads, and are expected to only have sponsored posts and other native ad strategies. The jury is still out on whether unintrusive native ads can make up the entire revenue stream of a publication.

Not that Yahoo’s short on cash. It’s golden goose is still its 24% stake in the Chinese e-commerce giant Alibaba. With Alibaba’s planned IPO this year, Google stands to gain billions of dollars, even if its stake in the company will be reduced by half. This means that Mayer and co. have plenty of cash to play around with to invest in acquiring even better content creators and the tech to make the advertising features more attractive. Let’s not forget that it still owns Tumblr, which is a content juggernaut, even if it hasn’t quite figured out the monetization bit yet. 

With a resurgent stock price and a daring, energetic investment in original news content, Yahoo seems poised to complete its resurrection this year, and if its ad/content strategies succeed, it may become the first company to have the answer on how journalism will thrive in the digital age.

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