How Yahoo made itself relevant in mobile — and what its future looks like (interview)

When chief executive Marissa Mayer appointed Adam Cahan as Yahoo’s head of mobile and emerging products two years ago, his task seemed impossible.

How do you make a company relevant in mobile after it practically ignored the sector for years?

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But in that time, Yahoo has made more than 30 acquisitions in mobile, and it’s grown its mobile traffic almost three-times over. The company has also boosted its mobile team from around 60 people to more than 500.

Perhaps the biggest mark of success: You may actually have a Yahoo app on your phone now.

Cahan discussed Yahoo’s big mobile moves, as well as what lies ahead, with us a few weeks ago. (Editor’s note: Don’t miss our earlier interview with Cahan, at CES 2014, in which he discusses Yahoo’s mobile strategy, what’s next for reinvention, and more.)

VentureBeat: How have things been going so far since you’ve joined Yahoo in October 2012?

Adam Cahan: When we started one of the things we figured out was that a platform shift was coming. We said mobile is going to be important … We took a step back and said, “How many people at Yahoo are currently working exclusively on mobile?” … And it was a very small number, about 37 people that we could identify.

If you think about that in the context of a company of 13,000 people, it was an “and” statement. We have all these things we’re doing and we’re mobile.

[We’ll be discussing how to drive mobile growth at MobileBeat 2014 in San Francisco on July 8-9. Grab your tickets now to take advantage of early-bird pricing!]

VentureBeat: If it’s everyone’s job, it’s no one’s job, right?

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Adam Cahan: Exactly. It created kind of a hobbyist sort of culture. So we said, you know what, if we’re really going to believe in this platform and make a big bet, we need to create a team. So that was what Marissa helped me start, which was the mobile and emerging products team.

The first thing we did was scale the team — we did over 30-plus acquisitions, we were really, frankly, trying to rebuild that core capability. A lot of those teams were just team hires. So, over the last 18 months or so, we’ve had, quite literally, more product created than I’ve ever seen in my personal point of view. If you look across pretty much every single service Yahoo is engaged in, we have done a refresh, reimagination, rebuild of that product experience. … As a result of creating those products, we saw enormous user growth. When I started we reached around 150 million monthly on mobile. Today, as Marissa shared in our most recent earnings we reach over 430 million monthly [on mobile, across web and all of Yahoo’s apps].

We’ve been focusing, originally, on a lot of those core product things that we felt were what users were doing on devices, but also things that Yahoo can uniquely provide. More recently what we’ve been focusing on is things like systems. How do you bring all of these disparate experiences together to have meaning for you as a user? We’re working a lot in the area of context.

For example, we recently acquired a company called Aviate, which is an Android home screen/launcher. And basically, it was this same idea: As a user, one of the things that really frustrates me about mobile phone experience is that I find myself basically launching applications, swiping across screens … There’s this behavior that honestly adds very little value to my day. We’re not really using the signals that we have in our devices to bring those experiences forward … The concept behind Aviate is use all of the context signals, be it time of day, location, or accelerometers to say hey, it looks like you’re at work now, these are the apps you typically use.

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We launched a couple of things recently, for example the unified application which brings together things like weather, finance, sports, mail, news, and information. So that as a user, we’re bringing you a heads-up display metaphor so you have all these experiences in one place.

VentureBeat: It’s almost the re-creation of Yahoo’s original web page, where people would go for news, weather, and everything else.

Adam Cahan: It’s an interesting analogy. One of the insights that happened for us was, if you look at the core mobile experiences, essentially what people are doing is a combination of communication plus some form of news and information. That’s sort of the core of what you do on your device — it is a phone, after all.

If you really go deep with what people are doing in email, there’s a couple different things that emerge. Typically what you’re doing on your phone on e-mail, versus a tablet or desktop, is that you’re really engaged in things like triage. You’re trying to quickly go through things and put them in buckets for how you want to deal with that.

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That was the first insight that helped us find what’s really the core mail experience. The other thing that we really found out was that people actually use their email because they’re bored. You kind of go to it as an experience to say, is there anything for me?

VentureBeat: We’re like rats hitting a button and nothing’s coming out.

Adam Cahan: I think all of us have our own social awkwardness … when we’re uncomfortable, we often turn to that device as a way to sort of engage with something else.

… When you look at what users were doing, they were returning to email, pulling refresh, waiting for email. We said, look if you’re coming to us that many times a day looking for information, why don’t we just bring the news in that context. And also, instead of having this experience of moving from one app to another, why don’t we just give you the core elements that you want.

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You’re right — if you broke Yahoo down into three pieces, essentially what you’d say is there’s mail at its core, there’s search, and then there’s the content and media experiences. That’s the core — and so we’re bringing those elements together.

The difference that I see today, is that because it’s all application-based it’s a very different performance experience [than the traditional Yahoo portal]. One of the things we did when we developed our e-mail client, we said here’s what the average user is trying to accomplish in mobile, on mail in a mobile device: you take the following five actions, you usually delete this much e-mail, etc. … If we build that as an app experience and really take advantage of things like gestures and how you engage with it, we could have you perform all of those same actions and remove a minute of time.

What you find is users give you back that time.

As an example, we grew the average amount of time spent per user per day across mail by one minute when we introduced the unified application.

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VentureBeat: When Mayer started and Yahoo was trying to find its new identity, a lot of people were asking, “What is Yahoo?” It seems like this unified app shows your new focus.

Adam Cahan: I would debate whether or not that’s a real conversation … I think, in success, people sort of accept anything a company is doing. What is Apple? They’ve got iTunes software, Mac OS, they’re pretty much in a million different places in our lives. Google — they have self-driving cars, there’s search, there’s display [ads].

I think, as companies, when we succeed and having the ability to touch our users live in a positive way, the areas we’re in become sort of an after the fact. There was a point where Yahoo was struggling with growth and returning to user relevance, in that period that’s where you had these kinds of technologies. I think what we came back with, is our goal is really to inspire and entertain our users. And that’s what we’re trying accomplish.

The secondary statement to that is, we want to create beautiful experiences for daily habits. We take that idea of daily habits to mean we want to be operating in places where we engage with our users on a daily basis. And those products and services that accomplish that kind of daily engagement goal are the ones that are successful and that we reinvest in, and continue to grow and scale.

VentureBeat: Those companies you mentioned, Apple and Google, are definitely in a ton of different things, but it seems like their identity and what they’re trying to do has been focused for a while, Apple especially. I think that’s been kind of cloudy for Yahoo. Has that become kind of clear over time now that you’ve made acquisitions and revamped things?

Adam Cahan: Absolutely. I would take that from the vantage point of internal culture, as well as what we’re focused on. I think one of the challenges early on with Yahoo was there was a lot of focus internally, and there was a lot of the internal challenges and all of the things going on there.

Now you have a company that’s extremely user-focused, externally focused and really focused on that notion of how do I build these products and services, and how do I bring the technology into these consumer experiences that allows us to really inspire and entertain our users. That focus on the users and external partnership, the way we think about the world. That changes the way that we operate.

The types of stuff we’re talking about internally are really about how are we solving these user problems. What are we doing that’s unique for them?

VentureBeat: Can you give me a sense of those things you’re debating internally?

Adam Cahan: What I find really fun is the evolution of the conversation. It’s almost a level of where the aspirations continue to grow and scale. When we started — going back to the point where there were 37 people in mobile — a lot of the questions were around, can we build products users want? Can we create these services where they’ll have permission to be on your phone?

We definitively have. The numbers show that we have. We’ve had terrific standout hits, like the weather app and Yahoo News digest. When you start to really feel that product cadence and those experiences, you kind of start from a place of simplicity. I’m trying to get myself invited in your daily habits and daily routines — I’m going to start with something simple.

As you take that journey with your audience, you start to get into more complicated behaviors and systems.

VentureBeat: You’re talking a lot about the importance of mobile, but you bought Tumblr, which really didn’t focus on mobile for a while. Did joining up with Yahoo enable Tumblr to make that jump? [Tumblr recently announced a major mobile update.]

Adam Cahan: It’s interesting with Tumblr. For one, I don’t speak for Tumblr. But in terms of the philosophy of how we’re operating with Tumblr, we recognize what David [Tumblr founder and CEO David Karp] and his team have done. They’ve done something truly unique, especially in the areas of social. The community is very much reflective of the archetype of the founders, and what their visions are and how they want to create something.

David is an extraordinary ambassador for creators. When you speak with him about the creative community, it’s remarkable. There’s a true connection and empathy he has with his users and understanding what they’re to do. It’s subtle things. The conversation I had with him that struck me the most was around the concept of reblogging. The typical metaphor was commenting, but he said he wanted to foster a community of positive feedback and enforcement. People are putting out huge amounts of self expression on Tumblr.

Commenting was actually the wrong metaphor — reblogging means I take something that you’ve created, and in order for me to comment on it, I actually have to repost it on my own Tumblr. So effectively, my commentary is more a reflection of me, and I have to effectively syndicate what you’ve done — versus just commenting and hating on something.

VentureBeat: Which the Internet loves to do.

Adam Cahan: Which the Internet loves to do!

That’s a long way of me saying, I think we view in David and that team something exceptional that they had created and built and understood. Really, we wanted them to operate in that manner independently. In general, there are different models of integration, and our fear going into it was that we didn’t want to smother Tumblr with love.

Instead, we took a philosophy of saying they’re going to operate independently. They call the shots. If and when there are things we can offer — monetization systems, analytics — we’ll do that.

VentureBeat: You’ve been acquiring so many companies. I’m not sure if Yahoo is building something, or if you just want to make sure you’ve got all your bases covered. What’s the strategy behind all the acquisitions?

Adam Cahan: Acquisitions take many different forms. You can loosely bucket them into three areas: Acquisitions that are transformative … I would put Tumblr in that category. … The next bucket is core technologies, where you’re really focused on the technical capabilities and IP that’s been created. Examples of that include IQEngines, an object and vision company that can identify things in Flickr. Summly is also one of those, where we used the summarization technology to build the Yahoo News Digest.

And then, there’s the third bucket which is just the team. It’s when we see a set of terrific engineers, terrific product managers, that have a good team dynamic, that know how to build and create things. As long as they are excited about what we’re trying to create, we can actually together build something of bigger scale.

If you look at every single product that we’ve shipped, these are all teams that pretty much started with acquisitions. What we do with those teams though is scale those teams.

If six people come in, the first job they have is hiring their friends.