5 challenges Marissa Mayer faces at Yahoo

July 17, 2012

Analysts and members of the tech industry were upbeat on Marissa Mayer’s appointment as Yahoo chief executive as she started work Tuesday.

As the San Jose Mercury News reported, analysts had expected Yahoo to hand the role to interim CEO Ross Levinsohn, but were nevertheless optimistic about the impact Mayer could have on the company that, admittedly, needs a lot of work. Here are five challenges that Marissa Mayer faces as she steps up to the plate at Yahoo.

1) Direction: The 37-year-old Mayer is now charged with steering a ship that’s had so many captains headed in so many directions that she’ll have to work quickly to establish what, exactly, she thinks Yahoo should be.

Mayer is Yahoo’s eighth CEO since the company was founded in 1995 — and its fourth in 2012 alone. She takes over for Ross Levinsohn, Yahoo’s head of global media, who was serving as the interim CEO following Scott Thompson’s resignation amid questions about his academic credentials. Thompson, in turn, took over in January 2012 from interim chief executive and chief financial officer Tim Morse. Morse took over the position from Carol Bartz, who was ousted in October 2011.

Each of those executives had a distinct idea about what Yahoo — which has a very diverse range of products — should be. Yahoo could be an advertising company, a media company or a tech company, but picking a path will require some serious reorganization on Mayer’s part. And once she picks that path, All Things Digital’s Kara Swisher noted, she’ll have to figure out who, exactly, her competitors are. Is Yahoo going to take on Google? Will it take on Facebook? Will it become a news site? No one seems to know.

2) Experience: Mayer has a lot going for her as she heads into this position. She’s clearly a pro at search — she was the head of search at Google for years — and is a pro at knowing what Internet users want to do online and how to make it as easy as possible for them. She’s a gifted technologist, with master’s and bachelor’s degrees from Stanford in computer science.

But she’s also never been the CEO of a company before. And while she’s managed a huge chunk of Google’s business in the past and given high-profile presentations for the company, people will still question whether she has what it takes to be the public face of a publicly traded company. There will also be questions about whether Mayer has the marketing experience Yahoo seems to want from its executives.

3) The Yahoo board: They may like her now, but it’s no secret that Yahoo has an outspoken board now filled with people who aren’t afraid to air their grievances with the company in public. Just ask Scott Thompson, whose fudged CV came to light after then- activist investor and now-board member Daniel Loeb got wind of the discrepancy and didn’t let go until Thompson was out. After Thompson resigned, Loeb and two of his nominees — Harry J. Wilson and Michael J. Wolf — were all given the nod to join the board. While it’s unlikely that Mayer, who actually taught at her former university and is mentioned frequently in its alumni magazine, will run into an identical problem, it’s clear that Yahoo’s board has some members who aren't scared to go after what they want.

4) Existing perception: Any discussion of Yahoo has to address the elephant in the room — the company just doesn’t have a good consumer reputation. When a security firm unveiled that a part of the company’s username database had been hacked, there was a lot of chatter that amounted to two words: “So what?”

Much of commentary online centered around making fun of anyone still using Yahoo, despite the fact that there are plenty of people out there who read Yahoo News, use Flickr, and still, yes, use its Webmail system. Part of turning Yahoo around will be rehabilitating this public image, as well.

5) High expectations: The flip-side of Yahoo’s public image problem is the hope that Mayer will be able to single-handedly turn Yahoo into a relevant, innovative, exciting company again, and quickly. As the Mercury News noted, this appointment has completely changed the conversation about Yahoo overnight. The report pointed to a tweet from Guardian technology editor Charles Arthur saying that he had been “wondering about Yahoo sliding into irrelevance” ahead of the announcement. “Now: different,” he wrote.

That’s a lot for Mayer to live up to, and while folks probably won’t expect her to have a new plan by Yahoo’s earnings call Tuesday, she won’t have long to puzzle out her best strategy.

Related stories:

Who is Marissa Mayer, Yahoo’s new CEO?

Yahoo names Marissa Mayer as CEO

Thompson stepping down as Yahoo CEO

Hayley Tsukayama covers consumer technology for The Washington Post.
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