Please ensure Javascript is enabled for purposes of website accessibility

Does Yahoo! Want to Ride the Facebook Boom?

By Daniel Sparks - Apr 1, 2013 at 6:30PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Yahoo!'s latest wave of acquisitions points to its realization that socially engaging content is king.

Major news websites are getting increasingly more of their traffic from Facebook (FB 4.11%). AOL's (NYSE: AOL) Huffington Post, an online newspaper, pioneered the world's most social-friendly news website by centering its strategy on platform integration, particularly with Facebook. Yahoo!'s (NASDAQ: YHOO) recent acquisitions suggest that new CEO Marissa Mayer plans to follow suit.

Success on Facebook is critical
In Facebook's announcement of its new timeline on March 7, executives repeatedly referred to Facebook as a "personalized newspaper." With a cleaner timeline and four additional categorized News Feeds, users get a more engaging experience.

The change is yet another reason news sites need to make social integration central to their strategies. As described in the company's press release, "[Facebook has] completely rebuilt each story to be much more vibrant and colorful and highlight the content that your friends are sharing. Photos, news articles, maps, and events all look brighter and more beautiful."



Source: Facebook Studio blog.

The content on Facebook makes up a complete package; it's more than a link or a story, explained Huffington Post's senior editor Dean Praetorius to AllFacebook. The new timeline places importance on accompanying photos. It's more important than ever to share rich and engaging images.

News isn't one-way anymore; it demands interaction. "We're putting the question out there for people to discuss. We're giving our answer at the same time, but we're making it something that everybody wants to talk about," explains Praetorius.

If any news website knows anything about Facebook engagement, it's The Huffington Post. According to a recent study by Newswhip, the site easily generates the most engagement on Facebook among all news sites.

Success on the social platform is imperative. Statistics confirm it: On average, 9% of all major news sites' traffic now comes from Facebook. This is up from 4% just 15 months ago.

Yahoo! is getting social
A quick glance at every Yahoo! acquisition since Marissa Mayer took the helm just five months ago reveals a focus on uniting content curation and social engagement.

  • Stamped: a mobile app specializing in social recommendations
  • Jybe: a personalized recommendation company that provides recommendations based on social contacts
  • Summly: a mobile newsreader app that curates news to make skimming easier

Not convincing enough? Just check out this excerpt from a Businessweek article on Yahoo!'s home page that was redesigned in February.

Most visibly, the redesign draws on a key element of Facebook and Twitter, introducing a "news feed" of live, endlessly scrollable content, which includes news stories, videos, and messages from advertisers. Users who sign in with both their Yahoo and Facebook credentials will see news stories tailored to their particular interests and indications of which articles their friends liked. "We think it's the right time to bring a more modern paradigm to Yahoo," Mayer said in an interview. "Overall it was important to me that the page be dynamic, that it feel very fresh, and that it be very intuitive, and that it really tries to embody beautiful design."

Yahoo! wants its content to be more engaging. Following Huffington Post's lead, the company seems to be setting itself up to get more prominent on Facebook.

Up more than 50% since Marissa Mayer took the helm, Yahoo! is still relatively cheap. I recently added the stock to my outperform CAPScalls.

link

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Meta Platforms, Inc. Stock Quote
Meta Platforms, Inc.
FB
$191.38 (4.11%) $7.55

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
332%
 
S&P 500 Returns
118%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/26/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.