Yahoo Places New Emphasis on Non-Premium Ads

  |  December 6, 2006   |  Comments

Speaking at the UBS global media conference, Millard admits Yahoo has given its long-tail inventory short shrift.

Yahoo has always poured the bulk of its sales efforts into high-quality ad slots and sponsorships, even while its reservoir of remnant inventory on user-generated and other tough-to-monetize pages has steadily grown.

That's in the process of changing, according to Chief Sales Officer Wenda Harris Millard, who oversees most display advertising for the portal.

"We have been maniacal in our obsession with Fortune 1000 companies and building out the brand business," she said during an on-stage Q&A at the UBS global media conference in New York. "We haven't focused as much on the non-premium inventory. We did not incent the sales staff in the field to sell it."

After assessing the company's strategy around remnant and other non-premium assets, Millard determined the company could make more money off such ads. She changed the incentive structure for her sales organization in order to better support the packaging of its cheap, bulk inventory with more prominent branded placements.

She also cited the company's October investment in online media exchange and ad network Right Media as a step toward better monetization of non-premium ads. "The opportunity for marketers to get the right message to the right person at the right time is a very good one with the ad exchanges," she said.

Of course, serving the right ad to the right consumer is one thing. Figuring out which pages are even appropriate for ads is another.

"There's no question there's a lot more inventory out there, and since the explosion of user-generated content, there's a lot of inventory," Millard said. "All of a sudden, technology has facilitated the rise of the consumer voice in a way that's startling to many of us."

And have Yahoo's media sales been stymied by the rise of sites like MySpace and YouTube and their billions of saleable impressions? Millard said no, since "very few companies, if any, are doing a good job of monetizing user-generated content."

She even took a jab at MySpace-style advertiser profiles. "I've got news for you: [Young people] don't want to be friends with the Burger King."

Millard pointed to the growing number of failed magazines targeting the youth demographic, noting that the kind and amount of ads is just as important a consideration as content to keep an audience happy.

"To hold them, you have to be very careful not only about the content, but also about the inventory," she said. "I spend a lot of time working on how we're going to leverage this phenomenon to the benefit of the marketer without losing the audience. It's a blast trying to figure this out, but I don't think anybody's doing this particularly well."

During wide-ranging comments, Millard also discussed topics ranging from the recent leak of Brad Garlinghouse's internal "peanut butter manifesto" to the press and investor reactions, to Semel's third-quarter warning of weakness in financial and automotive spending.

She attributed most of the negative attention Yahoo has received lately to press exaggeration of the ordinary growing pains experienced by a company that's outpaced the industry consistently for five years. "We don't need to regain the lead. We have the lead, by far, in every measurable way. It's not a 'regain' here, [except] maybe regaining a little favor with the press."

Another Yahoo crisis that's been given disproportionate attention, she said, is the supposed poaching of its ranks by competitors, according to Millard. "We have 10,000 employees; of course we're going to get hit on. But how many people have I lost to Google? Zero. A real media person doesn't want to go to a company that values above all else science and technology."

Contrary to the speculations of many technologists and Google fetishists, she argued the ad sector is not about to migrate to a system of total automation. "The idea that a machine could do all of this is just foreign," she said. "The reason Yahoo has the lead that it has in on the display side is because of our top-quality sales staff."

And what was Millard's reaction to Garlinghouse's much-discussed "peanut butter manifesto"?

"You could take Yahoo's name off that and put on almost any company you work for," she said. "It's press pile-on stuff. I found it annoying."

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Zachary Rodgers

Until March 2012, Zach Rodgers was managing editor of ClickZ's award-winning coverage of news and trends in digital marketing. He reported on the rise of web companies, data markets, ad technologies, and government Internet policy, among other subjects. 

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