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So far Wall Street has been enamored with Mayer as a businesswoman and a personality. She has outlined a much clearer vision for Yahoo than her predecessors.
Investors in Yahoo stock are happy – the share price is up more than 80% since Chief Executive Officer Mayer took charge.
That gain looks juicy for thirsty investors, but before buying in, we have to ask the question: Is this run over, or can Mayer keep delivering…?
What Mayer's Done for Yahoo
Here's what Mayer has done right.
Mayer's mantra is, "People, then products, then traffic, then revenue" – a step-by-step approach to turning the company around.
To date she has acquired more than 20 mostly startup companies. The idea is not only to buy the unique applications and products of these startup companies, but also to lock in the creative talent pool of engineers into long-term contracts that keeps them under the Yahoo umbrella.
The largest and most dynamic purchase was the acquisition of Tumblr for approximately $1 billion. Tumblr is a free social media/blog platform that caters to the younger crowd and has a strong mobile presence. Yahoo is trying to regain its standing as "trendy," and its association with Tumblr is one way to combat the stagnation of Yahoo's appeal.
With advertising being Yahoo's focal point of revenue, it is going to be interesting to see how this takeover plays out when Tumblr, which is currently free and offers no ads, re-engineers itself to a make a profit on a group of kids with no money.
There are many doubters (myself included), although supporters will point to Facebook's purchase of Instagram as proof that it can work. But then again I can retort with "Remember MySpace?"
As far as the other smaller companies/products Yahoo has purchased, they run the gamut of various ultra-narrow slices in the technological world.
One thing is clear – they are all geared toward mobile smartphones and tablets.
But, is there room for Yahoo in the mobile sphere when it has to contend with Google and Facebook for every advertising dollar?