Although the simple cause of Yahoo’s impending dismemberment is that it failed to deliver the financial results necessary to keep it whole, the more nuanced, and perhaps more instructive reason is that it failed to tell a convincing narrative.
Marissa Mayer never really had a chance, if you look back at the story we heard over the past four years.
At the start, there was the prerequisite blather that passes for vision in our era of soundbites and tweets; the company would be “mobile first,” and build “engagement” via “content.”
Then the company went about spending lots of money.
It bought dozens of companies, large and small, that did everything from run a gaming infrastructure (PlayerScale) to blog posts (Tumblr). It hired Katie Couric and launched numerous “verticals” to promote articles and interviews. Execs came and went, but the majority of what we heard about what was going on at Yahoo was driven by financial news, or Mayer’s fawning personality coverage.
You see, she was turning the company around. If the financials raised questions about how, when, or why, there were always more blathertastic buzzwords that could excuse away any detailed inquiry.
I have no idea whether or not Mayer’s strategies could have succeeded, if given enough time. But I do know that we learned next to nothing about how they were executed.
Who was working on reinventing Tumblr? How did Katie Couric’s producers pick topics to pursue? What insights led to the mobile homepage redesign, and what were the ups and downs that led to its launch?
And then there were all the smaller, back office projects originating from acquired companies like Xobni, Ztelic, Vizify, and other names that were invented by drunk branding experts. We didn’t hear one word about most of them after they were bought.
No people. No nearby milestones. No ups, and no downs. No details.
The occasional nonsense that accompanied each earnings call started getting stale, though. Stories started to appear in 2014 that evidenced some frustration that the financials weren’t keeping pace with the buzzworthy excuses, but still, Mayer and her team worked in what amounted to an opaque box (the occasional leaks of HR politics and occasional puff pieces about her notwithstanding).
When would the turnaround arrive? Eventually, everyone got too impatient with waiting, and the entire shebang was judged a failure.
And that’s the thing…turnarounds never arrive, but instead they’re works in progress. In fact, once you think a turnaround has occurred, it’s time to upend it and start another one.
Yahoo, like every other large company, was in a constant state of turning around, in real-time, and always would be. There would never be any endpoints, but rather milestones and signposts along the way. Every success needed a next step, as did every failure.
Its narrative should have been rich in the people, processes, stories, ideas, and blow-by-blow color commentary about that journey.
Instead, we were told little more than “trust us.”
The media deserve part of the blame, especially Greek Chorus outlets like Fast Company (which was celebrating Mayer as recently as mid-2015). Nobody seemed interested in challenging the potpourri of strategies and tactics that Yahoo was throwing against the wall.
But the majority of the blame falls on Yahoo, which failed to tell us why any of that stuff could or would stick. Seen in retrospect, it’s surprising how unconvincing its strategies really were.
Which leads back to the financials. When there’s nothing else on which to base a reasoned conclusion, then they’re the only thing that matters.
Financials matter, unequivocally, since they’re what allow employees to get paid, and stock to get traded. But a company’s intangibles — the reasons why we desire its products, trust its abilities, and cut it slack when it misses the mark (i.e. Apple Watch) — are direct influences on our opinions, decisions, and the time we’re willing to grant people and businesses in hopes of seeing their success.
That’s why telling an effective innovation narrative matters, and why Yahoo’s failure to share one helped ensure that its latest milestone might be its unhappy ending.