Yahoo 2011 Annual Report Download - page 13

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advertising team also sells search advertising to premium advertisers in transitioned markets. Our mid-market
channel sells our services to medium-sized businesses, while our reseller/small business channel enables us to
sell advertising services to additional regional and small business advertisers. In 2011, we reorganized our U.S.
sales force to focus on our customers and sales solutions to better meet their needs.
In the U.S., we employ sales professionals in multiple locations, including Atlanta, Boston, Chicago, Dallas,
Detroit, Hillsboro, Los Angeles, Miami, New York, Omaha, San Francisco, and Sunnyvale. In international
markets, we either have our own internal sales professionals or have established sales agency relationships in 50
countries, regions, and territories.
No individual customer represented more than 10 percent of our revenue in 2009, 2010, or 2011. Revenue under
the Search Agreement represented more than 10 percent of our revenue during 2011.
Internet usage is subject to seasonal fluctuations, typically declining during customary summer vacation periods
and becoming most active during the fourth quarter holiday period due to increased online retail activity. This
seasonality pattern has affected, and we expect will continue to affect, our business and quarterly sequential
revenue growth rates.
MARKETING
The Yahoo! brand is one of the most widely recognized in the world. Maintaining and growing the Yahoo! brand
enables us to attract, retain, and more deeply engage users, advertisers, publishers, and developers. We believe a
great brand begins with great products, services, and content. Our marketing teams engage in each step of
product and services development, deployment, and management and content design to understand and shape our
offerings to better market them to our communities of potential and existing users.
COMPETITION
We operate in the Internet products, services, and content markets, which are highly competitive and
characterized by rapid change, emerging and converging technologies, and increasing competition. Our most
significant competition is from Facebook, Google, Microsoft, and AOL, which each generally offer an integrated
variety of Internet products, services, and/or content. We compete with these and other companies for users,
advertisers, publishers, and developers. We also compete with these companies to obtain agreements with
software publishers, Internet access providers, mobile carriers, device manufacturers and others to promote or
distribute our services to their users. In addition, we compete with advertising networks, exchanges, demand side
platforms and other platforms, such as Google AdSense, DoubleClick Ad Exchange, AOL’s Ad.com and
Microsoft Media Network, as well as traditional media companies for a share of advertisers’ marketing budgets
and in the development of the tools and systems for managing and optimizing advertising campaigns.
We believe our principal competitive strengths relating to attracting and retaining users include our ability to
provide premium and exclusive content; the usefulness, accessibility, integration, and personalization of the
online services that we offer; the quality, personalization, and presentation of our search results; and the overall
user experience on Yahoo! Properties. Our principal competitive strengths relating to attracting advertisers and
publishers are the reach, effectiveness, and efficiency of our marketing services as well as the creativity of the
marketing solutions that we offer. “Reach” is the size of the audience and/or demographic that can be accessed
through the Yahoo! network. “Effectiveness” for advertisers is the achievement of marketing objectives, which
we support by developing campaigns, measuring the performance of these campaigns against their objectives,
and optimizing their objectives across the Yahoo! network. “Effectiveness” for publishers is the monetization of
their online audiences. “Efficiency” is the simplicity and ease of use of the services we offer advertisers and
publishers.
In international markets, we also compete with local portals that are predominantly supported by local
telecommunication providers or local providers of specific locally designed and marketed Internet services, some
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