Why Marissa Mayer 'Bought' Katie Couric For Yahoo
Katie Couric, now 56, represents her generation of women more than ever. A journalist, wife and mother, she has worn more hats than most men her age, but no more than the average midlife working woman, whether she be a business leader, civic leader, midlife entrepreneur, young widow heading back to work, and/or active empty-nester. As someone who has filled all five of these roles, Couric is the poster child for women over 45.
I thought about these facts last month when Yahoo announced that it had entered into a multi-year, multimillion-dollar contract making Couric its “global anchor.” While many have questioned this decision, and its price, I saw in it some of the focus that Mayer has brought to Yahoo since joining the company as CEO in mid-2012.
Early on in her tenure, Mayer declared that Yahoo’s three key challenges were “increasing usage, growing our international presence and appealing to a broader demographic of users — roughly in that order of priority.”
Every big decision Mayer has made since that announcement has fit within that sharp focus. She bought Tumblr for $1.1 billion, securing a new relationship with hip techies who may be rapidly abandoning Facebook. She has made a host of smaller acquisitions of start-ups built to serve mobile users. With a 24% stake retained in China’s e-commerce leader Alibaba, she retains a very profitable platform in that all-important market.
Think of Couric as another acquisition, and one devoted to serving one of Yahoo’s core markets: the Baby Boomers for whom Yahoo is both an in-box and a homepage.
Most media managers chase the audience they don’t have (Millennials) while ignoring the one they’ve got (Boomers), but Mayer is illustrating a different interest in having it both ways, not just tolerating, but seeking to serve and engage the Boomers who may generate the bulk of her profits for the foreseeable future.
We see Yahoo’s dependence on midlife subscribers every day.
Yahoo has long been the #1 webmail service used by our 100,000+ subscribers. Almost 20% of them have Yahoo email addresses. But that number is down from a few years ago, and Gmail has gained Boomer subscribers quickly over the same period. Most of Gmail’s market share has come at AOL’s expense—but Yahoo could be next.
Betting on Boomers also ties into Mayer’s overall bet on mobile. The Boomers we gather are going mobile almost as rapidly as their children: 28% of our visitors now access us via mobile devices, and another 19% by tablets. In order to retain and serve the 50-somethings who help keep its company afloat, Yahoo will have to be more relevant on mobile while finding ways to compete with Gmail as well.
Whether Couric represents the best way to accomplish these goals is a separate question. Couric has been a topic of evergreen interest to our members for many years. A recent email newsletter subject line that featured her (“The real reason Katie Couric is still single”) captured one of the highest open rates we’ve seen in years (and more than 150 comments).
We may look back and say that Couric was a wise investment in retaining Yahoo’s Boomer base.
Like AOL before it, Yahoo cannot continue to generate profits without the tens of millions of Americans aged 45-65 who find it the most convenient and relevant place to start their day on the internet. If Yahoo turned its backs on these users—a disproportionate of them women—it could begin losing page views, users, and advertisers rapidly. Mayer has shown a new kind of bravery in recognizing the value of these current members and regular visitors. Maybe because she’s a woman only 6½ years away from turning 45 herself!