News

POV: Yahoo Mobile App Moves

Mindshare Point of View

Yahoo announced the introduction of its Mobile Development Suite at its first Mobile Developer Conference in San Francisco last week. Yahoo’s service will combine a comprehensive range of tools with access to its vast consumer data sets, in an attempt to help app developers acquire users, measure engagement, and ultimately monetize their apps. This move is the latest, and possibly most aggressive in Yahoo’s fight to fully immerse itself in the mobile revolution, regain its search market share, and improve the reach of its ads.

Details and Implications

Yahoo has fallen behind its rivals in recent years, generating $768 million in mobile revenues last year, considerably less than Google’s and Facebook’s. However, under CEO Melissa Meyer’s leadership, Yahoo’s mobile department is witnessing a revolution, growing from a few dozen mobile-centric employees to more than 500.

The introduction of its development suite sees Yahoo using its one billion-strong worldwide reach, along with last year’s $270 million acquisition of mobile analytics service Flurry, as a catalyst for engaging app developers.

The new service is comprised of five main products: Flurry Analytics with Explorer (app analytics); Yahoo App Publishing (app monetization); Yahoo App Marketing (user acquisition); Yahoo Search in Apps (Yahoo web search integration + ads) and Flurry Pulse (transmission of data to partners). App developers will also be privy to Yahoo’s consumer insights, including how consumers engage with Yahoo’s digital content such as sports and fashion, their purchase intentions from Yahoo’s search data and their social interactions on Yahoo-owned Tumblr.

For advertisers and brands, the inclusion of the new analytic dashboard from Flurry will increase consumer tracking and improve ad-targeting capabilities. Furthermore, the facility to embed Yahoo video and native ads into apps will significantly increase ad reach on mobile platforms, especially as Yahoo hopes the 630,000 apps currently using Flurry analytics will run its ads – with Yahoo leveraging 40% of the revenue from ad sales.

The implementation of ‘Yahoo Search in Apps’ is also a poignant development for advertisers as, if successful, it has the potential to see Yahoo gain greater share in the search space; a similar tactic was used when Yahoo successfully integrated a search element into its Aviate application late last year. Yahoo’s search share is currently at its highest since 2009 after Mozilla's decision to replace Google with Yahoo as the default search engine on its Firefox Internet browser.

Summary

For advertisers, Yahoo is certainly providing the tools necessary to increase ad reach and targeting capabilities in the mobile space. However, whether Yahoo has ultimately left it too late to catch up with Google and Facebook remains to be seen, especially as unlike Google it doesn’t actually possess its own mobile operating system. Yahoo does however appear to be making strides towards regaining its search market share, which could be particularly pertinent as Apple’s contract naming Google as the default search engine for its devices is due to expire this year.