Yahoo 2003 Annual Report Download - page 5

Download and view the complete annual report

Please find page 5 of the 2003 Yahoo annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 94

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94

of Fantasy Sports users on the Web
and LAUNCH leads in streaming
music videos. Finally, we’ve spent
the last 12 months significantly
improving our HotJobs offering and
growing our share with job seekers,
so that HotJobs is well positioned
to benefit from the eventual
turnaround in the jobs market.
By building a fantastic user
environment and attracting the
world’s largest engaged online
audience, we have also created an
environment that is extremely
appealing to advertisers.
Largest & Most
Diverse Online
Advertising Platform
The tremendous performance
within our marketing services
business in 2003 is the result of
our efforts over the past three
years to build, buy and partner
in order to create the largest and
most diverse advertising platform
on the Web. As a result, we
benefited from our broad exposure
to small- and medium-sized
businesses as well as global, blue
chip advertisers. We almost
doubled our global marketing
services revenue year over year.
While this growth was aided by
acquisitions, our full-year 2003
legacy growth rate for the entire
marketing services business was
approximately 40 percent, and
accelerated in each quarter
throughout 2003. Growth came
from two key areas: (1) marketers
seeking brand solutions to drive
overall awareness and differentiation;
and (2) businesses looking for
an immediate return on their
marketing commitments through
lead generation services such as
pay-for-performance search.
Yahoo!’s share gains and revenue
growth in 2003 were the direct
result of focused execution of our
customer-centric selling strategy.
For example, we further developed
vertical category expertise, which
creates and provides solutions to fit
advertisers’ needs across categories
such as entertainment, automotive,
and financial services. We also
localized service and support, and
conducted thought leadership
seminars on critical issues in the
industry, such as creativity.
As we have strengthened our
ability to understand and deliver
upon our clients’ needs, we believe
we are driving deeper relationships
with brand advertisers and they
are becoming increasingly satisfied
with the results of online advertising.
Yahoo!’s inventory value increased
as a result of the growing
importance marketers placed on
having a presence on Yahoo!.
We continued nearly all of our
top 200 customer relationships
from 2002 to 2003, which is largely
weighted towards traditional,
blue chip advertisers. We also
experienced a healthy double-digit
year-over-year increase in our top
200 customer revenue.
We also benefited from the rapid
growth in the pay-for-performance
category as businesses of all sizes
took advantage of this affordable
and highly effective channel to
acquire customers. Ongoing
product improvements in Web
search, vertical integration of paid
search into parts of Yahoo!, as well
as the incremental contribution
from our Overture acquisition,
were the most significant factors
contributing to our success in this
large area of opportunity.
The integration of the Yahoo! and
Overture operations has proceeded
well, and the combination seems
even more compelling than we
initially thought. We’re excited
about our progress in testing and
implementing Overture’s Content
Match product into Yahoo!
properties, such as Entertainment,
Finance, Travel and Yellow Pages,
with many other verticals to come.
In addition, we’ve introduced
Overture’s pay-for-performance
model to Yahoo! businesses in
Europe and Asia. Yahoo!’s Small
Business team and Overture are also
working closely together to develop
synergies and cross-sell their existing
products, as well as develop new
products and marketing initiatives.
In addition, Overture’s great track
record with distribution partners has
enabled them to attract and retain
key accounts, and combined with
Yahoo!’s growing query scale, has
created a marketplace that is healthier
and more robust than ever.
Looking Ahead
While we are excited with our progress
to date, I intend to keep the company
focused on several key opportunities
ahead. I’m mindful that we’ve only
just begun to take advantage of some
of the tremendous opportunities on
the Internet; however, I believe that
we have built a strong framework for
long-term success, in which further,