Asia's emerging markets offer the most potential for Yahoo to grow its online user base and advertising footprint, says CEO Carol Bartz, who also has her eyes on the mobile Internet platform.
In town Tuesday for the Global Leader Series talk organized by the local American Chamber of Commerce, Bartz touched on Yahoo's presence in Asian markets, as well as the company's plans to further develop capabilities for target advertising and mobile Internet.
She said there were "two sides" to Yahoo's business: the consumer and the advertiser.
On the consumer end, Bartz noted that the company's U.S. Internet user base grew 3 percent in the last twelve months, while its non-U.S. user community grew 11 percent. These figures clearly indicate that the opportunity for growing its unique user numbers "is definitely outside the US and definitely in this part of the world", she said.
She added that figures from pundits put the compound annual growth rate for Asia's Internet user base at 19 percent through to 2012.
As the region's Internet penetration continues to grow, Yahoo also sees much potential in the Asian online advertising scene. Bartz noted that offline advertising revenue in the region is still at a hefty US$73 billion, "so little of has [yet to] come online". "As the Internet grows, the ability to bring advertising online is enormous," she said.
She explained that Yahoo analyzes data, while being mindful about privacy, collected from its 600 million users worldwide to gain insights that can be used to help its advertisers target the right audience.
The company collects some 50 petabytes worth of data each year and continues to invest efforts to improve and develop better tools to support target advertising, she said.
Bartz also wants Yahoo to expand its reach on the mobile platform, especially as more users connect to the Internet via their phones. "In many parts of the world, there will not be a personal computer. The new Internet users are the mobile phone users," she said.
Asked about impending competition from Google's recent purchase of mobile computing player AdMob, Bartz said the deal proves the importance of mobile monetization. She added that Yahoo is already involved in this space and does not need to make a similar acquisition deal.
However, she acknowledged that Yahoo needs to improve its development infrastructure. The company had spread its engineering processes across the globe "in its race to grow" at a quicker pace, which she said could prove a good strategy if there were processes in place to ensure better control.
"[For instance,] everybody had new ideas on how to make the news platform just a little better. So the news [site] would be different in Yahoo France and in Yahoo United Kingdom," Bartz explained. As a result, when the company needed to roll out upgrades globally, it needed to deploy the tweaks on each different platform across the various markets.
She added that Yahoo now needs to look at building a single central platform, from which it can make enhancements and add new features just one time, before rolling them out to be implemented across all sites.
Yahoo and local marketsLocalization, though, in terms of content and services, plays an important part in beefing up Yahoo's presence in international markets, Bartz said. "In Southeast Asia, for instance, we don't come here with U.S. content. We come here with local content and have local partnerships," she said.
She pointed to Yahoo's recent launch of its news service in several Southeast Asian Web sites, including Vietnam, Singapore and Indonesia, which helped Yahoo attract "more people coming to our news sites than to [news sites] CNN.com or BBC".
"We believe that we have a responsibility to do a good job in editorial, [and] not just [have] news delivered up by a machine. We actually have real people to see what we serve up in our front pages to make sure it's appropriate to the country and gives a local [user] experience," said Bartz.
To date, the company's sites serve 40 countries and are available in 25 languages.
According to Yahoo, its efforts in Asia have paid off. The company's Singapore office, which serves as Yahoo's headquarters for Asia and emerging markets, is currently its fastest growing global office, said Keith Nilsson, senior vice president of Yahoo's international emerging market. "From Yahoo's business perspective, Singapore drives the biggest revenues for this region," Nilsson said.
The local office was established in January 1997 and oversees all operations in Asia and emerging markets, which Yahoo defines as economies with an Internet population of less than 20 percent and broadband access lower than 10 percent. For Yahoo, Bartz added, these markets include Latin America, Africa and Russia.