The Best Product for Marissa Mayer to Fix

When the board of Yahoo decided to choose 13-year Google executive Marissa Mayer, it was telegraphed that the reason for the choice – over interim CEO Ross Levinsohn – was that the company believed she could lead a “product” renaissance at 17-year-old Yahoo.

Let’s forget for a minute that Yahoo’s two prior CEOs – Scott Thompson and Carol Bartz – were both product people who didn’t have extensive ad sales or ad tech experience. The board decided that despite those earlier failures, it wasn’t the strategy that was at fault, it was those leaders at the helm.

Forget for some more time that, above all, Yahoo has been regarded as a preeminent media property. A destination site. A site that you have to have on your buy. Yahoo ranked number two in site visits in May 2012, just behind Google.

Yahoo has no self-driven vehicles or mobile operating systems, and no social platform or apps framework. It has no app store or laptops or music players, no COTS or server software. What Yahoo has is a lot of ad inventory. A helluva lot.

Yet in the minds of its board of directors, Yahoo is apparently not a media company. To the board, Yahoo is a product company.

I’ll agree with the board for a minute. Yahoo is a product company. And Yahoo’s most important and visible product is email. As in

Until recently, Yahoo was the preeminent email inbox company. It beat Microsoft’s Hotmail more than a decade ago. When Google created Gmail, it wasn’t trying to copy AOL or Microsoft, it was trying to create a sticky platform to sell more ads against. Gmail was out to beat Yahoo Mail. Google realized that far from being uncool, email is actually really cool. As in hot. Everyone uses it. Everyday. Google knew this and it went after the one thing that it knew would pay a big annuity. And it even developed new ways to monetize it.

Marissa, you are going to get pulled in a million directions when you get to Sunnyvale. You’ll be urged to fire people, build “something,” “get social,” focus on RMX, kill RMX, etc. Where do you start? Start by going back to the future.

Your first assignment should be to shore up Yahoo Mail. Why?

Yahoo Mail still has more than 300 million members. Members like my wife and my mother – people who aren’t getting rid of their addresses anytime soon. Their email address is their online identity. It’s also a big reason they come back to sites every day. And it’s a big source of your revenue and site visits.

That’s not changing. email users, like webmail users everywhere, need some way to read notifications they get from Facebook and Zynga. And when they click away to go elsewhere, they soak up a lot of page views from the other parts of the Yahoo ecosystem that aren’t mail-related.

Marissa, when you sit down in your new office and get your new Yahoo-issued laptop, you’ll be faced with the biggest change you’ve probably made in a long time: That’s your new identity. You’ll be joining 300-plus million members of a community of Yahoo mail users. If you play this right you can truly be the product-oriented CEO that the board hired. Focus on a great annuity, Yahoo Mail. And then build what’s next on a stronger foundation.

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