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Summary:

Yahoo’s investment in big-name journalism isn’t about selling home page takeovers, but about convincing users to share more about themselves in exchange for high-quality content.

Katie Couric Pinterest
photo: Photo courtesy Pinterest

When Yahoo! announced that it hired Katie Couric as its Global Anchor, the industry consensus was that Couric’s multi-million dollar salary would eek out a small profit through the increased value of expensive ad units, like homepage takeovers.

But, the real value in the brand name journalists that Melissa Mayer has been hiring is that, collectively, they give end users something valuable, inspiring and delightful that makes them want to come to Yahoo every day. And by doing so, gives Yahoo the opportunity to drive growth. But, to capitalize on this, Yahoo needs to evolve.

Yahoo must continuously learn more about the readers who visit its properties, so it can keep building its advertising targeting capabilities. Yahoo has a massive 2 petabyte database of behavioral data (growing at 1.2 terabytes of data daily). This provides a long tail of targetable segments, which provide orders of magnitude more revenue to the company than the Moby Dick of fat head advertising – the home page takeover – which Yahoo has only ever sold for $1 million on Cyber Monday.

Marissa Mayer Ken Goldman Yahoo earnings call video

But, behavioral data alone is not enough to drive quality incremental ad revenue. As news content becomes more commoditized, understanding users through collecting first party data and providing personalized experiences is the only sustainable competitive advantage brand news outlets have. Therefore, Couric’s true impact to Yahoo will be measured by how well she can get users to share who they are, and what they care about.

The traffic personality journalists drive can help build user understanding through both behavioral signals, such as reads, comments and shares to social networks, but also declared data, like high quality profile data (e.g. email address, gender, interests and preferences).

So, news outlets must drive data collection by identifying opportunities to progressively build first-party data.

For Yahoo, this starts with Couric featuring high-profile, exclusive interviews – content that you could not find anywhere else. Research has shown that audiences will gladly exchange personal data for content they care about, so gating Couric’s biggest interviews behind a registration gate is perfectly appropriate. An initial registration might include connecting your Facebook account, which would provide insights into the reader’s social graph, gender, age, interests, and more.

After that, behavioral data about where users navigate subsequently begins to round out the understanding of the user. If they visit the new David Pogue site regularly, they are interested in technology; if they head toward Matt Bai, they are political junkies.

When these audience analytics are shared with the journalists, this creates a positive feedback loop that allows for deeper first party data collection over time. If Yahoo sees a valuable audience in 50-year-old Lady Gaga fans (collected from the user’s profile), and Couric’s audience is typically 35-54, they can push a Lady Gaga interview to Couric. Since this content is even more valuable for the target audience, more data-sharing options might exist, such as the ability to submit your own questions.

This creates a virtuous circle between deepening audience understanding, and delivering more relevant content over time. The payoff spreads through Yahoo’s entire ecosystem, since it targets advertising on other non-news products, such as Yahoo Finance.

In the new media world, no journalist is an island; each is responsible for listening to and tailoring her audience. And no audience is passively consuming; they contribute to the conversation, share about themselves, and create a deeper experience for themselves. First party data connects them; both sides win. Brands create loyal, highly targeted audiences and consumers receive relevant content based on their demographics, psychographics and behaviors.

Jamie Beckland is a digital strategist and VP at Janrain.

  1. Re: Yahoo’s investment in big-name journalism
    How does this fit in with things like the new Yahoo Apple TV App? The ABC News on the Yahoo Apple TV App is a lot better than the ABC Apple TV App.

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  2. There is nothing that will compel me to visit Yahoo on a daily basis now that Yahoo Mail has been reduced to garbage. I dumped my Yahoo home page and just about everything Yahoo-related.

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    1. That is too bad for you, an outage affected only 1% of the Yahoo Mail users and that you think the mail is garbage seems like a targeted attack vs. Yahoo. I like the new email, I like using an app like outlook or my smartphone to get my messages, the graphical interface is not bad on the web, but it feels so 90′s using that interface for email when there are so many better and also free apps/programs for email reading.

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  3. No one is going to watch this!

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