KCSA PUBLIC RELATIONS, INVESTOR RELATIONS BLOG
Posted by Stephanie Stuchin on May 23rd, 2013
On Monday, the Yahoo/Tumblr flirting rumors proved to be true when Yahoo announced its plan to purchase Tumblr, the blogging service, for a reported $1.1 billion. The hipster blogging site with more than 100 million blogs and 50 billion posts has been around since 2007 but only generated $12 million in revenue last year. So why did Yahoo pay so much?
As Hubspot put it, Tumblr is cool and is full of young people. It’s the youth injection that Yahoo needs to balance out its aging demographic. After all, for teens, Facebook is old. It’s on Tumblr where all of the cool kids hang out. A survey this year conducted by the online data group Survata found Tumblr more popular than Facebook among those ages 13 to 25. I’m sure part of this is due to the fact that most of these children’s parents are also on Facebook but likely not on Tumblr. With this new acquisition it appears as though some of the younger Tumblr users feel that their private online party was just invaded by what might as well be their parents.
Yahoo CEO, Marissa Mayer tweeted Monday “We promise not to screw it up”. Many young Tumblr users are skeptical and are not fond of the prospect of being served ads disguised as content in their feeds. This may have been the impetus for the flood of new blog posts imported to WordPress on Sunday night. Word Press saw 72,000 new blog posts within an hour which is tremendously higher than the standard 400 to 600 posts they tend to see on most Sundays.
So was this a good move for Yahoo? I think so. It pushes Yahoo even further into the social game. The biggest challenge will be to leverage this new audience without altering their current user experience. There is clearly some fear for current Tumblr users as many are “packing their blogs” and moving on. I think there is still hope as long as Marissa Mayer keeps her promise and doesn’t screw it up.