Five challenges facing Yahoo! chief executive Marissa Mayer

The tech world was taken by surprise yesterday when Yahoo! announced Google veteran Marissa Mayer would take the chief executive role – and the response has been overwhelming.

By all accounts, Mayer’s appointment has breathed some potential life into the troubled media company, which has run through four chief executives in the last five years. With plenty of Google experience under her belt, Mayer seems well placed to bring some success to Yahoo!, and there’s plenty of buzz that she’ll actually succeed.

So why is this seen as a good move?

Mayer was Google’s 20th employee, hired back in 1999. Since then she’s overseen some of the company’s biggest products including Google Maps, Google Images, Gmail and even the company’s bread and butter – search.

Mayer is an accomplished public speaker, having been the key spokesperson for the company for some time, and even hosted a fundraising dinner for Barack Obama two years ago. She also has a keen eye for design, having overseen the layout of the iconic search page. At age 33, she was listed as one of Fortune’s 50 Most Powerful Women in Business – the youngest entrant ever.

She’s also extremely rich, with an estimated fortune of $US300 million.

She’s well-liked, articulate, and incredibly smart. Mayer is more than qualified to turn Yahoo! around.

But she’s also got a huge task ahead of her. After all, the company just announced a 4.4% drop in profit. Over the past five years, shares have fallen $US41. Everyone is waiting for this company, one of the few left from the 1990s, to fail.

Here are the five biggest challenges Mayer faces as she moves into her new role.

1. No media experience

Yahoo! wants to turn itself into a media company. After all, that’s how AOL has managed to survive all these years, and when done right it can be a winning strategy.

But Mayer doesn’t have much media experience, if any, with her talents more focused in other areas. That’s not to say it can’t be done, just that it may be a little more of an uphill battle.

2. She’s pregnant

Yesterday Mayer confirmed that she is indeed pregnant and quite far along – she’s due in October. She also said she’ll take a few weeks off and then get right back into the thick of it.

Mayer is known for pulling 130-hour weeks – her work-ethic is not the issue. What’s more, if Mayer was a male, her impending parenthood would not even be raised. She’s certainly breaking new ground as chief executive of a multi-billion dollar company and becoming a new parent is only going to add to that challenge.

3. Brain drain

What happens when a company starts sinking? The same thing every time – talent leaves.

Yahoo! is on a downward spiral, and all the smart people will have started heading off to other gigs. Mayer needs to slow that drain, and make sure she can attract good talent. That will increase morale over time.

4. Winning over Levinsohn

Ross Levinsohn is an important figure. He’s served as the company’s interim chief executive, and successfully brokered a deal with Facebook to end its patent dispute. But he’s also been passed over twice for the top job in the past year.

Levinsohn has a clear vision for the company too, wanting to make the business focused on improving its ad and video services. He’s an entrenched figure, and Mayer needs to get him on side. If she can, they’ll be a powerful force, especially with his extensive media experience.

5. Branding

Just what is Yahoo? No one can answer that question right now, and it’s something Mayer will need to fix very quickly. We know it wants to become a media company, but what does that look like?

Branding experts suggest a new face needs to be put on the business if it wants to stay relevant with users. Mayer’s focus on products can help that plan, but the business will need to develop a way to get there.

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