Yahoo Inc. believes a lot of its good work has been overlooked by investors and the media so it’s spending more than $100 million to get the word out to consumers directly.
The money is going toward the Internet company’s most expensive marketing campaign since Stanford University graduate students Jerry Yang and David Filo started Yahoo’s Web site 15 years ago. Yahoo provided a peek at the 15-month blitz Tuesday in New York.
The ads will run on television, online and other media in the United States and nine other countries where Yahoo hopes to expand on a worldwide audience that is already approaching 600 million.
Despite its extensive reach, Yahoo’s brand has been bruised in recent years as its profits sagged and many people turned to Internet search leader Google Inc. and relative newcomers like Facebook Inc. and Twitter Inc. — none of which have spend much money on self-promotion.
Yahoo’s financial struggles were magnified last year when Yang and the rest of the Sunnyvale-based company’s board spurned a $47.5 billion takeover offer from Microsoft Corp.
The rebuff alienated many Yahoo shareholders, and the missed Microsoft opportunity has remained a recurring theme in the business press because the company’s market value now is about 50 percent below Microsoft’s last takeover offer in May 2008, before the rivals ultimately agreed on a search partnership nearly two months ago.
Yahoo Chief Executive Carol Bartz, hired eight months ago to steer a turnaround, believes the company has been getting a bum rap — something she hopes to reverse with the new advertising push.
“When you get outside of New York City and Silicon Valley, everybody loves Yahoo,” Bartz said Tuesday during a press conference that was webcast. “Why are you (the media) so cynical about us? Be cynical about frigging Google. If you don’t love us, leave us alone.”
Wall Street’s affinity for Google is driven by money.
Google’s revenue has been rising in recent years, even during the U.S. recession, largely because it dominates the Internet search market and can thus sell more text-based ads that appear on the side of search results. Yahoo’s share of the search market has shrunk in the past few years and, more recently, the recession has made it more difficult to sell the visual ads that have long been its specialty.
Investors have rewarded Google with a market value of nearly $160 billion while Yahoo’s hovers around $24 billion. Shares in Mountain View, Calif.-based Google gained $2.06 to finish Tuesday at $499.06, after crossing $500 for the first time in 13 months earlier in the trading session. Yahoo shares fell 18 cents to close at $16.86.
Yahoo’s new ads will highlight its recent efforts to give visitors more ways to customize the pages that they see on Yahoo, even if it means drawing upon material from other sites.
One ad reads: “There’s a new master of the digital universe. You.”
