The Big Reason for Yahoo’s Woes: Marketers Fleeing to Social Media
September 8, 2011 by admin
Filed under Latest Lingerie News
If there’s a single reason why Yahoo gave CEO Carol Bartz the ax yesterday, it’s that she was unable to recharge Yahoo’s growth. And more than anything, that’s because Yahoo is AWOL from social media, where it’s now becoming clear that marketers are spending more and more of their ad budgets.
According to a new Duke University survey, chief marketing officers said they plan to hike their spending on social media from 7.1% of their marketing budget to 10.1% in the next year–and to 17.5% in the next five years.
The CMO Survey, which polled 249 CMOs of U.S. companies, found that social media still isn’t a huge priority, with relatively few integrating it into their overall marketing efforts. But the trend is clear. In the same survey two years ago, CMOs were spending only 3.5% on social media.
Facebook, of course, is leading the way–in a big way. According to the latest word from Reuters (backed up by my sources), Facebook grossed $1.6 billion in revenues in the first half of the year, double last year. Given that second-half ad spending is usually considerably higher thanks to holidays, that puts Facebook well on the way to the $4 billion in 2011 revenues forecast by eMarketer. And it means Facebook will pass Yahoo in display-ad revenues this year.
All this is doubly threatening for Yahoo, because at this point, it has virtually no hope of developing a social network or even significant social media hooks into its services. It’s simply too late for anyone, perhaps even Google, to create a social network that can compete with Facebook, especially since Facebook seems to be avoiding the kind of fade that virtually destroyed MySpace. And with its management and future now thrown into uncertainty, it has no resources and, soon if not already, little relevant talent left to innovate in social media.
