As Chief Yahoo Resigns, Can Big Data Save Stumbling Company?

Author: Linda Rosencrance
Spotfire Blogging Team

Author: Linda Rosencrance
Spotfire Blogging Team

Yesterday, Yahoo co-founder Jerry Yang resigned from the board of directors and all other positions at the troubled company. This comes on the tail of Yahoo recently naming a new CEO, Scott Thompson. What may save this stumbling company is the new CEO’s belief in big data. So much so that he says big data is the “key to Yahoo’s long-term health.” In fact, Thompson is counting on big data and analytics to help Yahoo compete with Facebook and Google.

For Thompson, formerly the president of PayPal, making use of Yahoo’s data is crucial to building the best products for consumers and advertisers. In his interview with AdAge, Thompson explains that PayPal was able to harness its data to create “an unbelievably compelling business because the company used data to understand risk and fraud better than anyone on earth.” 

Thompson says he’s even more convinced that the same opportunity exists for Yahoo to use the data that’s at the heart of its business to make the company successful. According to Thompson, the winners in the battle of the next generation internet companies will be those that have the most data and use it better than their competitors.

“If this business is going to be really successful five years from now, we’ll get this right better than anyone else,” Thompson told AdAge. “As a result, the consumer experience will be better than anyone else’s and the advertiser ROI will be, too.’

Larry Dignan, Editor in Chief of ZDNet, agrees that the successful companies will leverage analytics, customer data and predictions to serve their customers better – in much the same way retailers do to figure out where to locate their stores and how they affect consumer spending. Dignan says Yahoo’s biggest asset is data and if Thompson can harness that data, Yahoo might be able to save itself and create value for its shareholders without having to go private, break up or sell out.

In a conference call announcing his appointment, Thompson says . . . “[T]he data that these internet businesses create and the analytical ability to understand what that data tells you, and the ability to use technology and analytics to drive a better outcome for your customers is in almost every business I’m familiar with, today, online and offline is becoming more and more critical.”

Thompson says the technology is there and Yahoo has to take advantage of it. “[T]here is tremendous value if you can organize and interrogate data at the scale Yahoo has,” he says.

Words to live by for any business that wishes to remain competitive.