Yahoo has been given just eight months by its new owner, Alibaba, to get its brand in shape. Any later and CEO Jack Ma believes the opportunity to challenge market leader Baidu for internet users and advertising dollars will be missed.
Last month, Alibaba made headlines with its US$1 billion deal to become the exclusive licensee of the Yahoo brand and search technology in China. The deal saw Yahoo adopt a cooperation model which has proven successful in Japan, a market where the company does not directly run an operation.
However, some have questioned whether the investment was valued too high. Incidentally, it took place a week after Baidu's IPO, which was also believed to have been inflated.
Either way, the deal should bulk up Alibaba's offering to investors ahead of its plans to go public within the next five years, giving the mainland company a host of e-commerce, instant messaging and high-margin businesses, such as online gaming.
But the spotlight, for now, shines on Yahoo and Alibaba is scrambling to tackle the muddle of brands in its fold. An aggressive marketing campaign to promote and rebuild the Yahoo brand is being rolled out, including a new homepage -- patched up so it resembles the homepage of chief rivals Baidu and Google -- and a new business model focused on online search instead of its previous general portal offering.
Alibaba has also consolidated the Yahoo China search brands, including Yisou.com and 3721.com, under the Yahoo Search name. While the search market is relatively young in the mainland, it's not without potential. But some sobering figures from the China Internet Network Information Centre warn that search engines without a strong brand could be wiped out as 34 per cent of web users use only one search engine when surfing, and 41 per cent use no more than two.
Whether Yahoo's name carries the same weight in China as it has in more developed markets remains to be seen. But industry analysts agree that for Yahoo to close the gap from 32 per cent share of the search market to above Baidu's 37 per cent may take some time, the one thing that Yahoo is short of.
Seeking to dominate Chinese cyberspace
With the clock ticking on a deadline to shape up its brand, Yahoo has to find a way to tackle China rivals - and lift market share.
