Gurmit Singh, who took over as the Managing Director of Yahoo! India earlier this year, has a tough job in hand. At a time when rivals such as Google and Facebook are catching the imagination of Internet users, Gurmit Singh has to ensure that Yahoo!, which was once the darling of netizens, stays relevant.

The stakes are high as India’s Internet user base, currently at about 150 million, is growing rapidly and Yahoo! has a lot of catching up to do.

Three key things Thankfully for Gurmit Singh, Yahoo!’s global CEO Marissa Mayer has undertaken a transformational path that’s focussed on three things — people, products and revenue. “We would like to say the journey is like a marathon – it’s not something which you run and catch up. It needs to be divided into smaller parts, let’s say sprints. So, it’s a marathon with small sprints,” he.

The first sprint which Yahoo! wanted to win was to recruit the best people. A number of changes was done internally to have a start-up culture mixed with fun.

“The plan has paid off – today, the number of applicants to Yahoo! has gone up multi-fold. The attrition rate is at all-time low. Also, 10 per cent of Yahoo! employees, globally, have come back. That gives you a sense of confidence that you are in the right direction,” says Gurmit Singh.

Real challenge But the real challenge for Yahoo! has been to get the right product mix. While 10-15 years ago it reigned the Internet world with products such as Yahoo! Mail and Yahoo! Messenger, the advent of players such as Google and WhatsApp has taken the sheen away. The company is now trying to reinvent itself to bring products that catch users’ attention. Some launches such as the Yahoo! Weather App and Yahoo! News Digest have got some traction.

For example, in India, there are 8.1 million monthly unique users on Yahoo! Cricket for mobile and is growing at 52 per cent annually. The Yahoo! Homepage is a trusted partner to about 28 million monthly users in India with close to three million people visiting the homepage daily for news, searching, watching video, emailing and checking weather.

The company has also launched Yahoo! Screen, which is a video content site, in a bid to take on the likes of YouTube. Yahoo! may also look at the possibility of producing its own video content like serials or movies in India.

“Yahoo! is a technology company, which is interested in making daily habits of users interesting, entertaining and inspiring. That is where all the energy is around. All the new products which are developed, whether its personalised experience, all are around daily habits,” says Gurmit Singh.

More tie-ups To reach its products to a larger base, Yahoo! is tying up with content partners and telecom companies.

For example, it has tie-ups with service providers such as Tata DoCoMo, MTS and Tikona to offer co-branded homepage. Mobile is a huge focus area for the company with nearly 50 per cent of the Yahoo! India users on the mobile platforms.

In terms of new users, Yahoo!’s mobile user base is growing 25 per cent annually. The new apps we are launching start on mobile devices and go to other screens. Yahoo! Cricket is a very good example,” says Gurmit Singh.

So how is this all playing out in terms of revenue? Yahoo!’s main source of revenue is from digital advertising, a space dominated by Google. While Gurmit Singh would not share India revenues, he says the shift in advertisers’ attitude in favour of Yahoo! is beginning to happen.

“What we do is to organise vertical-wise events. We do our own research and we have an insight’s team which does independent research on those verticals. We share with them (advertisers) the research findings and tell them these are the things we are doing globally and you could also get inspired from,” he says.

Analysts reckon that Yahoo! has indeed re-invented itself on various levels but more needs to be done. “The recent launch of their mobile applications really wasn’t impressive. The functionality was not up to the mark and the design lacked user engagement, which I believe now Yahoo! has addressed.

Focus on integration “It’s good to see Yahoo! focussing on integration. Their recent acquisition of FlickR and now the video streaming service RayV Inc, shows that it’s important for them to integrate such services under one umbrella and provide to their users a dynamic experience,” says Sanchit Vir Gogia, Chief Analyst at Greyhound Research.

The strategy seems to be paying off because the first quarter this year was globally the best quarter for Yahoo! after 2010. Gurmit Singh would be hoping that Indian operations add to that performance over the next one year.

“Yahoo! needs to re-invent themselves to step up their growth in India. Once the acquisition cycle is done with, they need to up their game by becoming more market facing and broaden their Enterprise offerings,” says Gogia.

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