Yahoo Ad Sales Reorg Signals Platform-Agnosticism

By combining its search and display ad sales teams under one executive leader--search side's David Karnstedt--Yahoo is catering to what its customers want, but in a platform-agnostic fashion, Karnstedt's boss said last night.

"You will hear more," said Gregory Coleman, Yahoo's executive vice president of global sales, in an interview. "We have a full plan. Today's announcement is a signal to say to everyone that we're serious."

Months in the planning, the reorganization is accompanied by the departure of longtime Chief Sales Officer Wenda Harris Millard, the six-year Yahoo veteran whose new job as president of media for Martha Stewart Living Omnimedia, starting July 16, was announced separately by that company yesterday.

Millard was on the team that developed the ad sales reorganization plan, knew Karnstedt had been chosen to run it, and opted for the MSLO position rather than take on a global ad sales role for Yahoo, she told Online Media Daily. (See related story.)

"This new structure further solidifies marketers' instincts to plan their search and display campaigns together," said Roger Barnette, president of SearchIgnite, a media management platform specializing in auction-based media, and sister company to 360i. "Additionally, with this news following Yahoo's acquisition of Right Media, Yahoo is laying groundwork to emerge as a leader in providing auction-based media opportunities beyond search marketing so advertisers can achieve the most efficiency with their campaigns."

Coleman said it will take several months to work out the exact integration, but that the timing of the announcement had nothing to do with Millard's new job. Rumors that she would be leaving Yahoo for something new have circulated for weeks, and reverberated even louder last week after Terry Semel stepped down as CEO and was replaced by Co-founder Jerry Yang. Millard, whose profile is best-known on Madison Avenue, is credited with legitimizing Yahoo as a destination for leading brand advertisers. Earlier in her career, she was a founder of the pre-bubble DoubleClick.

"Integrating our world-class search and display sales teams under David's leadership will allow us to better serve all of our advertisers' marketing objectives ranging from brand awareness to direct response," said Sue Decker, president of Yahoo in the official company statement announcing the move. "This is one of many important steps we're taking to re-invigorate our display business, further build on our industry-leading position in advertising, and drive thought-leadership in the online advertising marketplace."

Last Monday, Yahoo said its second-quarter revenues would be closer to the lower end of earlier guidance because of display advertising weakness.

"David Karnstedt has done great things for Yahoo's Search Sales business, and it's his leadership skills, business acumen and keen understanding of the new media landscape that make him the perfect person to help shape the future of Yahoo's advertising sales business," Coleman said.

Karnstedt, who continues to report to Coleman as head of North American sales, joined Yahoo Search Marketing (formerly Overture) in September 2001. He is also a veteran of such pioneering Internet companies as Lycos and Alta Vista.

"By taking a more holistic approach to advertising sales, Yahoo will become a more consultative seller, which should make buying complete solutions easier for our customers across Yahoo and our partner sites," Coleman said.

Yahoo has been seeking to boost its share of advertising business on partner media sites as well. It is supplying both display and search advertising for eBay, and has recently signed deals with Comcast and a consortium of newspapers. Karnstedt will oversee ad sales on all Yahoo properties, including the new One Search mobile platform.

Yahoo made every effort to focus its statements on Karnstedt's elevation rather than Millard's departure, but her decision to leave is a reminder of a new wave of executive departures. Earlier this month, Yahoo's chief technology officer, who led the development of the Panama search marketing platform, put in his last day.

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