Yahoo Revamps E-Business Tools

Yahoo is revamping its e-commerce hosting platform to make it easier for small businesses to open and manage online stores.

Yahoo plans to unveil today the first stage of the project by introducing two new "wizards" for designing stores and adding inventory information.

The automated guides feature intuitive interfaces, templates, layouts, and menus that hide programming complexity from users, a Yahoo official said.

In addition, the stores built with the wizards are automatically optimized for search engine spiders, said Jimmy Duvall, director of e-commerce products for the Yahoo Small Business unit.

Yahoo plans to extend this initiative, which it calls Open for Business, to areas like online payment and shipping in early 2007.

The wizards are intended primarily for small businesses that have balked at the technical difficulties of setting up shop online, he said.

The wizards represent an improvement over an existing set of Yahoo tools called Store Editor. This will remain available to merchants, but requires more technical savvy to use.

Many Rivals

The market for hosted e-commerce services is getting crowded, so Yahoo must continually improve its offerings to remain competitive against rivals like eBay's ProStores, said Sonal Gandhi, a Jupiter Research analyst.

While the new wizards aren't spectacularly innovative, Yahoo is right to focus on simplifying e-commerce tasks, she said. This resonates with small businesses because it reduces their need to hire outside help, Gandhi said.

It's no secret that small businesses often lack the time and expertise needed to create, run and maintain an online store, said analyst Greg Sterling of Sterling Market Intelligence. "Creating an e-commerce Web site has been a historically complicated proposition for small businesses," Sterling said.

At the same time, small business owners realize that having a Web presence is essential because their customers and competitors are online, Sterling said.

IT vendors can reap juicy rewards from the small business market. The estimated 6.2 million small businesses in the U.S. are expected to spend about $98 billion in IT products and services this year, according to AMI Research.

Competing Efforts

Yahoo isn't the only vendor courting small businesses with the promise of simple and intuitive products. On the hardware front, Dell launched new servers in September aimed at small businesses that it said are easy to set up and maintain.

Meanwhile, Google wants to boost its online advertising business in this market via a partnership it struck in September with Intuit, which makes accounting software for small businesses.

Intuit's QuickBooks 2007 has shortcuts and links to Google's AdWords advertising program, Maps Web site and Base product listing service. As in the case of Yahoo and Dell, Google's strategy for reaching small businesses centers on simplification.