What Yahoo Offers The Investor
Firstly, there's little point in buying any internet share if you don't believe and understand the real potential of the net. I'm not talking about what these companies can do over the next few years, rather what and where technology will take us over the next 10-20 years.
The reasons why have we started to like Yahoo so much are:
1 - Yahoo Is A Web Portal
Yahoo is something that Google certainly isn't - a Web Portal. A Web Portal is defined as 'a site that functions as a point of access to information on the internet. Portals present information from diverse sources in a unified way'.
When was the last time you went to Google's website other than to use the search engine? However, a large amount of Yahoo's traffic doesn't use its search facility. Instead they visit the site for instant messaging, read/write emails, read/watch the news, look for jobs, check stock prices etc.
Yahoo therefore attracts plenty of repeat visitors. This is very important as the internet is now a vehicle for information snacking which is discussed in more detail below.
2 - Usability
Usability is something that all web users want from a site. Is the site easy to navigate, can we find what we want quickly, do we easily get lost or confused (web users don't like to think) etc. Yahoo has this general usability because from the company's inception in 1995 it has concentrated on -
- Simple interfaces
- Clean page layouts
- As few clicks as possible to go to where you want
- Intuitive functionality, and perhaps most importantly
- A guiding and helpful presence
But why is usability even more important today and in the future than it ever has been?
Simple, studies now show that the vast majority of internet users practise what's called 'information snacking'. Primarily because of broadband connections, this concept means that internet users quickly flip from one site to the next looking for various little snippets of information. The present and future trend is one of ever shorter visits to websites.
But the kicker to information snacking is that once we find a site we like, and above all is easy to use, we revisit it time and again. This is because it's easier to trust sites we know, know how they work, have received good information from them before etc, rather than have to shift through a load of spam and other useless sites.
This means that users will visit more frequently which translates into more advertising revenue.
Personally I visit Yahoo everyday for just the reasons listed above, I know what I'm going to get and I know how to use the site. But at present it's not my main search engine, that's still Google.
This concept can be summarised in a simple equation :
Time spent with technology = familiarity
It is perhaps better shown with mobile phones. People who own a Nokia are far more likely to upgrade to another Nokia because they understand the software and how all the buttons work. In effect there is little or no learning curve when they first turn on their new phone.
One final point on the usability and structure of Yahoo. In the summer the company ousted the CEO and replaced him with one of the original founders, Jerry Yang. I think that with Yang in charge the company will make further investment into usability and general ease of functionality because he was the one that forged the website's foundations having changed the name of the original site from "Jerry's Guide to the World Wide Web" to Yahoo.
