Can Yahoo! Reclaim Its Brand Mojo?

NEW YORK There was a time, before Facebook or MySpace existed and Google was little more than a search engine, when Yahoo! was synonymous with brand advertising online. Its most visible champion in the late-’90s and earlier this decade was sales chief Wenda Harris Millard, a fixture on Madison Avenue.

Yet, Yahoo!’s failure to compete effectively in the burgeoning search marketplace led the company to change direction and de-emphasize its branding heritage.

The Web giant invested heavily in building a search-ad platform, spending more than $1 billion on acquisitions like remnant ad network BlueLithium and exchange provider Right Media. Millard was jettisoned in favor of David Karnstedt, a search-marketing veteran with little experience in brand building.

With the battle to avoid a takeover by Microsoft raging, Yahoo! has staked its future on AMP, an ad-buying platform designed to help clients easily run campaigns.

Enter Joanne Bradford, a former Microsoft executive who, like Millard, often fought for the Internet to be taken seriously as a branding vehicle. Bradford ran MSN and developed wide-ranging brand programs like Live Earth and started a well-regarded branded entertainment unit. She often shared the stage at industry events with Millard, who, like Bradford, worked in magazine publishing before migrating online.

Now, Bradford replaces Karnstedt in a broader role as Yahoo!’s senior vice president of U.S revenue and market development. She becomes a key driver of the company’s advertising strategy moving forward.

“He’s not a Madison Avenue guy like Wenda was,” said an agency executive of Karnstedt. “Joanne has a little of that Madison Avenue in her.”

Yahoo! declined to make executives available to discuss Bradford’s appointment.

The company has long denied taking its focus off brand advertising. In a statement, Yahoo! president Sue Decker said: “Yahoo! and Joanne have a shared mind-set about the strategic role that Yahoo! and online marketing can play to both build leading brands and drive customer acquisition for the world’s leading marketers.”

Yet, while Decker extolled both sides of the acquisition/brand divide, some in the industry view Yahoo!’s selection of Bradford as an admission that the company has tacked too far toward direct-response ads and away from its roots as, first and foremost, an Internet media company renowned for premium brand advertising — the kind clients have traditionally done in magazines and on TV.

“What’s old is new again,” said one ad industry veteran of the hiring.

Her task won’t be easy. Yahoo!’s corporate turmoil has damaged morale, according to agency executives, leading to a high churn of reps and inconsistent attention. Upstarts like Federated Media and others have proven more agile at constructing the kinds of deep integrations brands covet. Yahoo!, meanwhile, has been consumed with trying to stave off Microsoft and assuring Wall Street it can compete against Google.

“They’re struggling on a perception level as well as a strategy level,” said David Hallerman, an analyst at eMarketer.

When it was dominant five years ago, Yahoo!’s competition came mostly from rival portals MSN and AOL.

Today, Yahoo! faces a far more competitive and complex market as it battles for a share of ad budgets. Clients are shifting money to hot social networking platforms like Facebook, but some of those nets also compete with Yahoo! in other ways. MySpace, for example, views Yahoo! as its main rival, having created popular vertical channels for music, movies and other interests to attract brands. Plus, the rise of ad networks means marketers can get broad reach without heavily relying on a portal’s properties.

“The pendulum swings back and forth,” said Emily Riley, a Jupiter Research analyst. “Yahoo! has a big glut of impressions, especially with Yahoo! Mail. It makes sense they’ll want to make more money from that. That will come from yield optimization and the more technical side of advertising. Where they get brand marketers is when they create special program. The pendulum has to swing back towards those higher-end experiences.”