|It is one and a half years since Yahoo acquired Del.icio.us, the online bookmarking service. Any acquisition goes with a long term business strategy. At most times, one of the primary reason for the acquisition of a company is to integrate the users of both the services. Other times, it is to leverage the audience of the acquired company through ads on the site. Now that sufficient time has passed since the acquisition of one of internet's most loved websites, it makes sense to introspect into what benefits has Yahoo gained out of this acquisition.|
Frequent users of Del.icio.us will vouch for the fact that one reason why Del.icio.us is best is because they have absolutely no ads on their pages. This makes it a pure utility website. That also means Yahoo is not monetarily gaining too much out of this acquisition.
Yahoo is yet to integrate Del.icio.us to Yahoo. Users of Yahoo and Del.icio.us still have different usernames for the two websites. So, Yahoo is yet to decipher how many of the users of these two websites are common and how many new users they have added as a result of this acquisition.
Does this acquisition get Yahoo any closer to Google? No. In fact, ever since Del.icio.us made it to the internet scene, Google has been able to get more relevant results thanks to the concept of tagging on Del.icio.us. Not that Google would have not got better results otherwise, but a huge directory of tagged links to numerous webpages does indeed help. Yahoo too has been able to use this to get search results closer, but nothing more than what Google probably has got. It is after all Yahoo's property.
What can be done?
This blog post comes close on the heels of the launch of SmartAds by Yahoo. SmartAds are aimed at providing more personalized ads to the Yahoo users. Traditionally, when a user searches for a keyword, "Apple" (say), the keyword is taken at face value while delivering the ads. So in this case, it could be a mixture of ads on Apple computers as well as the fruits.
SmartAds tends to infer more about the user through his activity on other Yahoo products, like Yahoo Finance, Sports, Music, etc. So,if Yahoo infers that you follow the stock of Apple computers at Yahoo Finance, the ads that relate to Apple Computer Stocks is displayed thus getting you the most relevant ads.
Yahoo can leverage Del.icio.us for the first time with SmartAds. By learning what kind of webpages a user likes to bookmark, a great deal of information can be unearthed. Added to this, SmartAds will also enable Yahoo to infer why a person is bookmarking a particular page for. If a user is storing a webpage on 'Weather in Mumbai', it can either be because he is interested in Mumbai or the weather. Tags("Weather" or "Mumbai") can greatly help Yahoo interpret the same webpage in different aspects for different users.
Del.icio.us is a goldmine waiting to be tapped. Unlike Google, which wastes no time in integrating user-ids of its hot properties with its existing user base, Yahoo has so far not done it with respect to Del.icio.us. Allowing users to login to Del.icio.us with their Yahoo ids is the primary step in this direction.
Labels: Business Model Analysis
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