Ask every startup founder how much time and money they spend on public relations, and the usual answer is “Nothing.” With a limited amount of both resources, entrepreneurs worry about building product and doing sales rather than getting buzz. However, a review of Marissa Mayer’s time at Yahoo! thus far should reveal that not only is PR important, it is vital for early-stage companies to survive.
It has been a year since Marissa Mayer started the revolution at Yahoo! – the slumbering internet pioneer who was slowly slipping out of the public’s consciousness. Nowadays you can’t turn away from hearing about Yahoo! latest venture, acquisition or financial report. While the jury is still out on whether Mayer has really revolutionised the firm, her presence has definitely put the iconic purple Y! back on the map.
Rewind to June 2012, Yahoo was in chaos: Two CEOs were out the revolving door faster than Yahoo! Mail could load. The last one, Scott Thompson, was in fact put out on unemployment welfare as the scandal broke about him faking his resume. The stock tanked and all hope seems lost.
Marissa Mayer was the breath of fresh air everyone needed. This was scoring brownie points on all fronts. First, it was a coup for Yahoo! to poach a member of the top brass at Internet rival, Google. Second, Mayer was Google employee no. 20, their first female engineer – putting a deserving woman in the top job in the male-dominated technology industry. Third, she spent her career focused on developing product, which is what the firm truly needs. It couldn’t get better than this.
Journalist started to run out of ink to speculate on the stock prices based on the great achievements she has accomplished, the business development she is doing and predicting the next big move she will make. Then the human angle pieces were also flurrying out, as she was also pregnant. Mayer is challenging the notion that a woman can’t have it all. Doesn’t hurt that she and Facebook’s COO, Sheryl Sandberg, are best buds – the 2 most powerful women in tech. Mind you, this was even before her first day on the job.
The Internet was abuzz with interest and punters were on the edge of their seats anticipating Mayer’s every move. And moves she did make – big ones too. Mayer has since revamped many of Yahoo’s core products, like Flickr. Once the biggest photo sharing site, it has in recent years lost ground to Instagram and Facebook. With some love and cash from Yahoo, Flickr is on route to a great comeback. Usage at Flickr has also subsequently increased after the announcement.
She then embarked on an ambitious acquisition spree — including the blockbuster US$1.1 billion purchase of Tumblr, paid US$30 million for Summly, a 17 year-old’s startup, and other eye-catching (or puzzling) businesses. This trend of buying doesn’t seem to stop and keeps everyone guessing who else will be snapped up next.
To appease the shareholders and investors, Mayer returned hundreds of millions of dollars to them. Yahoo completed a long-awaited US$7.6 billion deal to sell back its 40 percent stake in China’s Alibaba Group, which keeps the company afloat with cash. What better way to generate news and goodwill than giving out cash?
Perhaps most important, Mayer has rejuvenated camaraderie among the ranks of long-suffering employees. This in spite of the draconian changes to the Yahoo! culture including the controversial – no telecommuting rule. While it seems like a move that recedes progress when all other tech companies are flaunting employee perks to retain staff, Mayer wanted to improve collaboration and reduce employees moonlighting. This is another masterstroke to keep the world’s eyes on Yahoo – convincing everyone that they will become even better and leaner. In fact, Yahoo’s employee satisfaction is now at a 5 year high.
People are talking positively about Yahoo! and its prospects, which was impossible to think of just 12 months ago. All the waves of PR directly led to a 73% increase in stock price since Mayer started. Investor confidence is up as the Mayer revolution spelt potential for the business.
Likewise for startup, PR is crucial. Almost all fledging startups need to raise increasing amounts of money to keep it alive while growing the business. By figuring important angles on how groundbreaking the technology or impact will be – pitch to the press for significant publicity online and offline. Nothing speaks more volumes to investors if they know of you before the meeting. Their checkbooks will be more open if they saw you on CNBC or read about you in the Wall Street Journal.
At the beginning, startups will need to increase performance metrics to look good. This means to add users, usage, revenue and senior employees. Even with a fantastic product but with no ground swell, this will be hard. Being able to get featured on PC World and Amazon Web Services will convince skeptics to give it a shot. It will also help in hiring and retaining staff if they feel the pride to work for a company in the public eye.
Finally, creating the fervor around the founder/s. The leaders of successful companies like Steve Jobs and Bill Gates become public figures. Being vocal on their thoughts, the public pines for their every word and follow their every move. Seeding guest posts and writing commentaries about your industry will make you look like an expert. Also, as you gain more fans, likes and followers, all your current and future startups will receive the adulation it deserves.
Has Yahoo! really succeeded yet? It may still be too early to tell. But the fact is that Mayer’s effort in public relations is raising optimism on their chances – which could be all Yahoo! needs to rediscover its early form. Perhaps you should also reconsider how much time and effort your startup needs to put in PR.
This guest post by Dropmysite publicist Peter Yu originally appeared on e27, a Burn Media publishing partner.