Twitter and Yahoo are facing increased pressure from Google and Facebook so reports of their recent discussions to potentially combine forces makes sense if you believe that bigger is better. Its tough however to see the synergies between these companies.
In other words, what can these combined entities do that they can’t by themselves? Pool advertisers perhaps? Allow seamless ad buys across a combined network? Maybe.
I just don’t see this combo as being a 1+1=3 situation… More like precisely 2 or perhaps even less because of the potential for integration problems. Neither company has shown a great strength in the M&A space – when it comes to integration.
I think back to 2011 when I advised Twitter to purchase MySpace… To more effectively take on Facebook.
In hindsight, I was right from the perspective that Twitter is tough to use and making it a more graphical social network would increase user adoption.
The upsides would be a graphical environment (which Twitter has subsequently added by allowing photos and videos to be seen in the feed) where ads would be more naturally consumed – like Facebook. I also think a more graphical social network would have allowed superior messaging capabilities.
Its water under the bridge at this point but its worth pointing out the situation for Twitter would have been much better had they listened to me.
Yahoo for its part should have acted on my advice from 2012 when I told the company to get a tagline like Making the web better. I also suggested they do 11 things after Yang stepped down and to date, none have them have been done effectively.
Had they effectively executed on this point alone, they could have become a web ad monster.
Why isn’t Yahoo the best at returning ROI for advertisers? It should be as it has just so much information about its users. Years back I wrote about how Google’s purchase of DoubleClick would put the search leader in a better position in terms of analytics but I never imagined Yahoo wouldn’t be a powerhouse in this area. The company needs to improve and quickly.
At this point though sheer momentum is working against both Yahoo and Twitter and they need to shake things up dramatically to become more relevant.