Agencies Weigh in on Yahoo’s Next Phase

Yahoo’s good reputation for sales support has persisted through wave after wave of bad news for the company, including its disastrous merger talks with Microsoft, an exodus of top talent, and the failed Google search marketing deal.

Sarah Fay, CEO of Carat USA and Isobar USA, says preserving the integrity of that sales organization should be a key priority for the firm during its next phase, when the company lays off some 1,400 employees and names a new CEO to replace Jerry Yang.

“It is going to be important for them to uphold the level of quality and consistency of service that they’ve always provided,” Fay said. “That becomes more difficult in financially challenging times.”

Fay isn’t the only agency exec with a prescription for Yahoo as the company deals with the Yang’s resignation. Yahoo has received no shortage of advice about the direction of its business and who it should name to run it.

Below, a few more prominent industry voices weigh in.

Could Yahoo Pendulum Swing Back to Media?

Some are hopeful Yahoo will focus more on media initiatives, a notion tarnished somewhat by the errors of previous chief exec Terry Semel. Semel and his head of entertainment, Lloyd Braun, invested in media initiatives at the expense of search, allowing Google to come up from behind and dominate that most lucrative of digital advertising categories.

According to Gregory March, group media director at Wieden + Kennedy, Jerry Yang made the opposite mistake “He was a big proponent of technical solutions over content,” he said. “They could’ve been a great media play but they took a step away from that to try and compete with Google. I think Yang stepping away might turn their focus to more of a media business, which is largely based on the quality of the content.”

Such a shift would be a tough sell for shareholders, given display ad prices continue to drop while search holds steady. But March notes, “If the quality of the content increases and the size of the ad space increases, it could be a viable [path forward].”

Along similar lines, The New York Times’ Saul Hansell argued yesterday what Yahoo really needs is an editor in chief: “I mean the sort of imperial editor who has a vision of how to create an environment that lures in both readers and advertisers.”

Search/Display Integration

Another prominent commentator, Jupiter Research analyst David Card, wrote this week that Yahoo has so far failed to capitalize on its parallel search and display platforms to offer more holistic ad packages. He calls out improved targeting, cross-media attribution, and cross-format campaigns as areas where the company has come up empty-handed.

However it’s not clear agencies are so eager to have search and display ads packaged by a single seller.

“I think you can do search and display integration strategically at an agency level, or a client level,” said Wieden + Kennedy’s March.

David Smith, CEO of Mediasmith, agrees: “Integration is something we do more from our end, with single-pixel tracking on Atlas or DoubleClick. That’s something we can handle.”

Yahoo may eventually be able to offer powerful cross-channel attribution through its nascent display ad management and selling platform, launched this fall under the name Apt. For now though, many media buyers are content balancing search and display in-house.

Does Jerry Matter?

Mediasmith’s Smith doubts the emergence of a new chief executive will matter much to advertisers.

“[Yang] wasn’t involved in ad sales,” said Smith. “He was sucked up in the overall running of the company and what they’re going to do about valuation.”

Instead he says the key C-suite player for this industry is head of sales Joanne Bradford. Bradford, whose title is SVP, U.S. revenue and market development, was hired in August after a brief stint with Spot Runner. One of the biggest names in digital advertising, Bradford previously ran Microsoft’s sales organization.

“[She] is one of the best in the industry,” Smith continued. They’ve obviously got to let Joanne do her thing and restore some credibility.”

Bradford’s task, according to Smith and others: Return Yahoo to its reputation for innovation, which characterized the company’s offerings until recently.

As Carat’s Fay notes, “Where I think a lot of other companies have talked about things, they’ve always been right there executing.”

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