Is Yahoo’s Business Model Work in 2011
IntroductionBoth of the financial and non financial strategies and aspects are essential for the sake of an organization; it is the only thing from which an organization takes a commendable position in an industry (Chernev, 2012). Strategic Management functions are more than essential for an entity, and it is the only thing from which strengths can be added in the entities particularly (Gilligan & Wilson, 2003). It is required to select a company, and then analyze its strategic model. The company is Yahoo and the research question is
Analytical Framework
History, Development and Growth
Yahoo is an American based multinational internet Corporation that has its physical location in California, United States (McLoughlin & Aaker, 2010). The company has a great name in terms of Web Portal, Search Engines, and other related services, including the Yahoo Directory, Mail and News. As per estimation, approximately 700 million people visit Yahoo’s website every month for different purposes, and most of them went on the site for financial news. The company reported net revenue of US$ 4.68 billion in the year 2013. In this assignment, it is required to analyze the business model of Yahoo in terms of current scenario.
Internal Strengths and Weaknesses Identification of Business Model
The existences of strengths are extremely important and favorable for the sake of the organization, and it is equally powerful and effective for Yahoo Inc as well (Meek & Meek, 2003). On the other hand, weaknesses are negative aspects that should be on the lower level. The internal strengths of Yahoo Inc’s Business Model 2011 are as follows
- The model has an effective attraction towards the customers
- The model had a perfect pricing strategy
- The model delivers the best promotional activities for the company in their future
- The model was very easy to use and implement
The weaknesses of the company are as follows
- Core dependence of that model was on increasing profitability rather than on customers
- It don’t have any space for any prevention from the economic crisis
Nature of External Environment
External Environment usually includes the expansion opportunities for the company along with external competition. The opportunities for Yahoo Inc is as follows
- Cloud based services are increasing tremendously for Technological companies, and Yahoo Inc can get an added advantage with it with their Business Model
- The stance of mobile advertising are increasing
- The field of finance has now spread in all over the world, and the utilization of Yahoo Finance is increasing too heavily predominantly in the market of the United States
- The probability of growth through mergers and acquisitions are increasing for the company
The threats of Yahoo Inc are as follows
- There is an intensified competition in the Search Engines and development
- The needs of the consumers are changing on a regular basis
- Potential lawsuits and regulations are high pertain to this industry
SWOT Analysis
The acronym of SWOT is Strength, Weaknesses, Opportunities and Threat analysis (Moutinho & Southern, 2010). It is a mixture of internal and external analysis of the company, which is already performed in the above-mentioned analysis. The analysis is proved that the company is strategically fit and financially very strong.
Corporate Level Strategies used by the Company in terms of Business Model 2011
Everything an organization does is to attain effectiveness in their future. There are certain strategies that deem more than important for the organizations attain effectiveness, and among those strategies there is a name of corporate levels strategy is yet another. Yahoo Inc is one of those organizations of the world that had a strong corporate strategy, and it can be used in the current scenario with a little change (Wilson & Gilligan, 2013). The corporate strategy used by the company in terms of their 2011’s business model was to strengthen their current operations is Market Diversification, in which the company diversifies their products accordingly in different segments to increase their product portfolio, as it is the most important strategy for the companies operating in the current competitive and globalized world. The strategy of 2011 will work in the current scenario as well as the company needs to diversify its product and markets accordingly to compete with the peer companies.
Company’s Business Level Strategy
Likewise corporate strategy, there is a name of business level strategy as well that used to strengthen the roots of the business in a specific industry. The Business level strategy used by Yahoo Inc is Market Navigation, in which the company always strives hard for bringing more effective solutions to provide competitive advantage to the company. This particular strategy of 2011 can also be used in the current scenario.
Company Structure and Control System
Yahoo Inc had a perfect control system on the basis of their 2011’s business strategy, and the decision making stance of the company is centralized wherein every decision is been taken by a supreme authority for the sake of the company. However, employees are also empowering to take decisive actions for the company. The strategy of 2011 to empower employees would be extremely essential for the company in the near future.
Conclusion
Strategic well being is essential for an organization, and it is equally beneficial for Yahoo as well. From this critical analysis of the business modeling of Yahoo, it is found that the company is using one of the best models in town, however there were some drawbacks as well of that model which has been defined above. The company can use this model in the 2011 strategic function; however there are certain recommendations that should be acquired by them accordingly
Recommendations
- Though the business model of 2011 can be applied in the current scenario, but the strategy of the company should include the pricing structure of the company or pricing strategy which has a direct linkage with the financial position of an entity
- The world is now a globalized place, and only those companies can survive which has power to leniency, therefore the company should come up with innovative solutions the same as they launched in the 2011’s business model.
References
Chernev, A. (2012). Strategic marketing management. [Chicago, Ill.]: Cerebellum Press.
Gilligan, C., & Wilson, R. (2003). Strategic marketing planning. Amsterdam: Butterworth-Heinemann.
McLoughlin, D., & Aaker, D. (2010). Strategic market management. Hoboken, N.J.: Wiley.
Meek, H., & Meek, R. (2003). Strategic marketing management. Oxford: Butterworth-Heinemann.
Moutinho, L., & Southern, G. (2010). Strategic marketing management. Hampshire, U.K.: Cengage Learning EMEA.
Wilson, R., & Gilligan, C. (2013). Strategic marketing management. London: Routledge.
