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For eMarketer’s CMO One-to-One series, Yahoo CMO Kathy Savitt discusses the company’s refocus on users’ daily habits as well as innovating the platform to accommodate ads as amenable to a mobile-first sensibility.
eMarketer: With the departure of Yahoo’s editor in chief, Jai Singh, you’re now heading up media and editorial functions. Can you talk about this move?
Kathy Savitt: I’m still my same old self, but I have taken on some additional responsibility at Yahoo. Basically, that boils down to the content and editorial initiatives, efforts and responsibilities at Yahoo.
Media is a funny, big, amorphous world. There’s the canvas, which is building the products, and that’s run by our product team, and then the paint—what actually gets painted on that canvas. That’s what’s been added to my responsibilities. I’m working with the teams to hone, innovate and expand our voice, our curation of what we think our hundreds of millions of users are going to like, and our editorial vision.
eMarketer: What are Yahoo’s priorities for the next 12 to 18 months?
Savitt: We are a mobile-first company with a very focused mission, and that mission is to make the world’s daily digital habits inspiring and entertaining. All of our product development and our user engagement focus on things that are done daily.
This year, we’re continuing to evolve many of the daily habits we reimagined last year. We relaunched the Yahoo Mail app on iOS and Android last year and have seen a 150% increase in daily active unique users. In addition, since we launched our new finance app, which we redid in November, daily active users have doubled.
At first, we focused on what I would call traditional enterprise habits such as search, email and finance—like the old traditional habits that Yahoo had become known for in its history. This year, we’re getting very aggressive about innovating around a mobile-first approach for content daily habits. We launched our first two digital magazines, Yahoo Tech and Yahoo Food.
When we think of a digital magazine, we really think of it almost as a 360-degree media entity that follows a magazine format. The magazines were announced on January 7, and in that time, we’ve seen more than 10 million unique users, which is really a validation of the mobile-first approach.
eMarketer: With this mobile-first approach you’re taking, monetization seems to be the next step. How are you going to monetize your mobile properties?
Savitt: Concurrently to reimagining our consumer mobile experience, we’re also reinventing the ad experience with a mobile-first ethos. We believe that ads, when done well, are as accretive to the content and can actually be additive to the user experience. At CES (Consumer Electronics Show), we introduced the Yahoo Unified Advertising Solution, which allows our users to enjoy “stream” ads, where the ads appear contextually in streams. In addition, there are image ads.
Stream ads tend to be text-driven, while image ads are more of a native format in mobile. Last May, we purchased Tumblr. It is having some really significant and encouraging early success with sponsored posts and native advertising for mobile and PCs.
We’re also doing a bunch of sponsored content on magazines. I had a friend who gave me this anecdote about her going to Yahoo Food because she loved the articles. She was trying to figure out what she was going to make her family for dinner, and there was this amazing thing about how to make any macaroni and cheese gourmet on the spot, even in your work lunch room. It was only later on that she realized that it was actually sponsored content.
That’s how we’re thinking about monetization. It’s an unprecedented time for “performance meets creativity” for advertisers. I’ve spent half my career as a CMO, and these are exactly the sort of tools creatively where you’re able to track and get superior performance that I’ve always wanted from a brand standpoint. This wasn’t possible five years ago.
eMarketer: Yahoo recently announced that it is set to replace mobile banner ads with native ads.
Savitt: Our core belief is that great advertising is additive to the user experience, and when you put your brand or your message in context with really relevant, compelling editorial, the user is able to see your brand in action.
One of the problems that marketers have had is that display ads, while disruptive, sometimes have not been as contextual. You have to choose between performance and brand, and I think native advertising gives you the opportunity of combining both of those.
eMarketer: How does Yahoo label native ads to make sure that users don’t confuse them with editorial content?
Savitt: That’s really important to us. It’s very much a church and state, and we follow the industry standard constructs. With stream ads, you will actually see it shaded a different color, and it says “sponsored” very clearly. If it’s an image ad, we also make it clear that it’s sponsored.
eMarketer: What are your goals this year with these native ad formats?
Savitt: At the end of the day, we want to help our advertisers increase the effectiveness of their marketing—not just on Yahoo, but beyond. We have monetization goals ourselves, but we don’t release these publicly.
eMarketer: Yahoo has always been a news-driven company. How will the ongoing investment in tablets and smartphones, as well as using Tumblr’s publishing platform and recent hires, including Katie Couric, help change things around?
Savitt: The notion of news has been completely redefined in the digital world and certainly in the mobile world. There are people who on average check their phones 150 times a day for all kinds of things. A mobile device, whether it’s a tablet or smartphone, becomes a device that allows you to consume media when and how you want in the most useful way.
Breaking news, in terms of a mobile device, is completely transformational because you don’t have to go home and wait for the news to be on—or even wait for a free moment and check your laptop or your desktop device. You can actually see breaking news as it happens.
From an information standpoint, we can go much deeper. Mobile allows people with deep hunger for information on their favorite subjects or on the things that really inspire them to get real-time information that changes how they live their lives, how they do their jobs and how they make decisions.
eMarketer: With that said, the mobile and digital industry is constantly changing. What are some challenges that you’re facing in the space?
Savitt: A challenge in the industry right now is this fragmentation of advertising tools in general. All marketers are challenged with that. That’s why we spent the past few months really focused on leading the simplification of that experience—not only for our advertisers, but also for our users.
There’s also a huge proliferation of interesting content on the web, so discovery becomes even more important. Last year, we released our proprietary personalization algorithms, and you see these infinite possibilities of creating a personalized home webpage or a personalized stream where my homepage and what I’m interested in looks very different from someone else’s. Personalization becomes a really interesting way of delivering that content experience.
Another opportunity is with digital magazines. We feel that content in general is becoming less text-based and more what I call the 360-degree media experience, which includes photographs, video and audio. It’s a new way of creating engagement with content that we couldn’t even have dreamed of years ago.
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