Right Media: Truly Digested?

For this issue, let’s take a peek at what YAHOO did first week of September, about Right Media.  If you have not heard it yet, Marissa Mayer, YAHOO’s new CEO, just rejected the idea of selling YAHOO’s ad tech business in Right Media and instead said that she would be investing in it.

Yahoo! HQ.

So, what makes this move risky as many perceives it to be?  It’s because there were actually a number of buyers that could have eventually netted YAHOO between $500M to $1B aside from being able to cut 2,000 jobs; and two, its operating expenses is just too high to maintain.

But then, how come Right Media is not making enough money?  Simple, because business has gone to Google or other companies.  Now, if you were the CEO, would you sell or not?  What would you do then?  Why?

Here’s what, with all the money floating around the “what ifs”, odds would be against you if you do not sell yet taking a risk like what Mayer did was an opportunity to show one’s foresight, courage, and ability to turn things around.  Hence, risk taken.

Now, having taken the gamble, one would assume that all stones have been turned before coming up with the decision.  Otherwise, it’s suicide.

As it is, it seems that they have also already mulled over several avenues to increase revenue – from increasing rates to improving YAHOO’s ad tech to better Google’s; to considering premium display and video ads.

Still, the biggest question that they should really answer is – What really makes Google better than YAHOO’s ad tech?  Do not ask YAHOO or Google people, or even their clients but their clients’ target audience – more so, ask the ordinary but smart and frequent visitors of the sites.  That’s where you would get the real score.  See, taking a bigger market share is more than simply attacking unserved or underserved areas (unless you think the same) but thoroughly understanding your base and your competitor’s base – then advancing it by a mile.  For once you have fully grasped not just Right Media but YAHOO itself and those of your competitors and improve on them – things like more cash will trickle in.

What’s your take?