reveries - david riemer

JANUARY 2003

The Yahoos in Yahoo-ville are smiling a lot. Their revenues are up, their numbers are hot. How did that happen? David Riemer knows the reason. It has nothing to do with banners, buttons … or the season.

It seems in Yahoo-ville, they have learned quite a lot, about that which is real and that which is not.

In his graduation speech at Brown University, David Riemer, now VP of Marketing Solutions at Yahoo, spoke about how students lived in this fanciful world. How they went to a school that was up on a hill, where there was ivy on the walls.

Down the hill, mind you, was the real world.

David used this parable of following some papers that had blown down the hill, where he discovered the rest of the world. It was all about going out into the real world and figuring it out in light of all of the theory he had learned.

"It was a lot like the early days of the Web," David muses, "when it was all about what might be possible. It was all of this dream stuff -- the kind of stuff you thought about in a classroom in school." A lot of the things that he did in his first few years on the Internet were narrow like that, he says. We all know what happened back then.

But now, says David, there's a real sense that all of that original promise of the Web is finally truly possible, that it's possible actually to deliver tangible things: "You can then actually work with your advertisers again because you did something for them," he exclaims, adding, "It's very much like everything that led up to now on the Internet was all sort of academic. But now we're doing the real thing for very big and very real businesses."

After graduating Brown, David was in the advertising agency business for fourteen years, at J. Walter Thompson. He started there in the mid 1980s, working in New York and then San Francisco on a range of accounts. He ended up running the Sprint business for J. Walter Thompson globally. He then ran the West Coast operation of Thompson, right through about 1998, where he started an interactive practice in the high-flying days of the mid 1990s.

He left to get his "digital MBA", working for a couple of Internet companies. First it was Quokka Sports, a now-defunct online sports entertainment company, where he took the company public, ran marketing and corporate communications and strategy. Did that for a couple of years and then went to another start-up called the FeedRoom Network, an online video news network, where he ran sales and marketing.

Both companies were very much about developing innovative ways to feature content, as well as advertisers and marketers online. It was also his entree to his world of the Web. That led to his joining Yahoo last year -- mid-year -- based on the opportunity to take all of his agency, marketing and Internet background and apply it to the worlds' biggest Internet platform.

How different is it being at Yahoo compared to your days in more traditional advertising at J. Walter Thompson?

Much of the thinking is similar -- a lot of the creativity, a lot of the innovation that I used to do in the agency business, we're still doing here. But the exciting thing is that because we have control over the distribution platform, all these new possibilities open up.

At J. Walter, I couldn't control the way an idea ultimately was distributed. There were huge limits on how you developed an idea. Now we can work with agencies and marketers to develop ideas that actually control the distribution platform.

When I was in advertising, I couldn't make a 48-second commercial and get network television to run it -- I had to run a 30 second spot. I couldn't make that commercial interactive. I couldn't give people a choice of what the ending of that commercial was. In the online world, I have so much more control over the delivery mechanism, over the medium through which these marketing programs run.

What exactly is Yahoo's vision of the Web as a medium for marketing?

It's that the Web has evolved into a medium that is capable of so much more than simply being a distribution vehicle for a marketing message in the form of a banner, a button or whatever. It truly is a platform on which a marketer can run a marketing program.

There are a whole host of solutions that go well beyond a banner ad. We're developing new creative solutions using rich media, new promotional solutions, as well as research and insight solutions. We're also connecting those solutions to specific categories of marketers. There are about ten of them -- including auto, travel, consumer products, entertainment, retailing, financial, tech, and a few others.

How has that vision played out on behalf of some of your advertisers?

Let me give you an example from the retail category. We are working with retail customers who are actually pretty savvy online marketers who recognize the Web as being a good channel in terms of selling stuff online. But what they hadn't quite figured out was how to use online media to drive offline sales.

The Gap is a retailer who understood this potential. Gap had been using Yahoo to draw traffic to its online store as well as Yahoo's stores. But since we reached so many people in their demographic, the thought was to use Yahoo as a way to drive traffic to their offline stores and build up their database at the same time.

So they took their television campaign and actually aired it first online. We used the spots as a viral tool to create a lot of buzz around their new television campaign, which featured celebrities and so forth.
The approach drove in-store traffic, and they learned which of the commercials were the most effective. They also built a database of some customers in the process.

How would your approach then change for a category such as automotive?

Let's take General Motors, which historically viewed Yahoo as just a way to generate sales leads. Now, GM is working with us to help launch true branding campaigns. They used Yahoo to extend their television campaign, which featured songs like American Pie -- you know, take the Chevy to the Levy -- and Little Red Corvette. We introduced rich media units on the Yahoo network, where people could hear the songs and then replay them if they wanted to. It was just a great way for GM to extend its television message online.

How does the model change when you shift to a less considered purchase, like Consumer Packaged Goods?

Well, it might change in terms of what their objectives are, but in terms of bringing the holistic solution, we're just doing different kinds of solutions. In that world, we're doing some really exciting things with companies like Pepsi, Kellogg's, Unilever and Kraft and others, where we're developing brand building as well as CRM work involving building databases and loyalty programs.

Loyalty programs we ran for Pepsi helped them save money on the distribution of their "Pepsi Stuff" program and built a great database around that. For Pepsi, we've done a lot of branding work -- we did the whole Britney Spears campaign last year with them. We're trying to work with them on some new solutions that are in the works that I can't even talk about yet, but are really exciting.

I actually get most excited about Consumer Packaged Goods because it's the classic marketing category where some of the best marketers in the world have come from. But they haven't been coming to the Web much because it hasn't been "a channel" for them. But now they're realizing it's a great branding medium, a great CRM medium, and a great place to do promotions.

Do you see the emergence of any new online marketing techniques that aren't even on most marketers' radar screens?

Oh absolutely. That's the coolest thing about this job. I get to wake up every day and imagine what's possible online from a marketing standpoint and then try to make it happen.

Right now, arguably one of the most wasteful marketing programs is the circulars business. Think about the tens and hundreds of millions of dollars that people spend on circulars, FSIs and so forth. Either people don't open them, never get to them or the marketer is targeting the wrong person with the wrong message.

We are now finding ways of distributing circulars online, which is an area that we haven't exactly taken on yet, but it's the kind of thing that we are looking at. There are a number of promotional programs that are being done in the offline world that there's no question we can do more efficiently online.

You're going to see new creative approaches and types of creative that will be run online as broadband evolves -- more streaming media and more customized video messages, for example. You're just going to see all sorts of things coming down the pike, and you're going to see a lot of it this year because marketers are becoming much more receptive to these kinds of programs.

Given all these changes in the way that Yahoo is working with its advertisers, has your marketing organization also changed?

Yes. We've built out a product marketing team and a category marketing team -- neither of which existed before we were taking this new approach. The product marketing team looks for opportunities across the Yahoo network to improve the quality of the advertising environment, such as rich media solutions, targeting solutions, promotional products, direct marketing solutions, as well as the research and analytic solutions that provide insight tools.

On the category marketing side, we've been identifying folks who are charged with drilling down and understanding the needs of key verticals and then coming up with the right set of solutions across the Yahoo network. So, we've now reorganized sales around category focuses and have a sales and marketing team that really understands each category and puts together the right solution for each category, as opposed to coming in with a big overcoat and opening it up with seven hundred watches and saying, "which watch do you want to buy today?"

There's been a fair amount of press lately to the effect that the era of the portal has passed and that the winners will be those who build loyalty through original -- and not aggregated -- content. How do you respond to that?

Well, that's a really interesting observation … I guess whoever says that hasn't told the 248 million people who come to Yahoo every month! They come to Yahoo because it is too hard to follow a million different Web sites. So they go to a place they trust to get their information.

All you've got to do is look at our numbers to know that consumers like the idea of an online brand they can trust. If you look at the studies we've done, you'll see that we're the leading online brand in terms of trust and affinity. Millions of people keep coming back every day to see the information that we've pulled together. So I don't buy that argument. All the numbers that we look at suggest that the opposite is true.

How do you see the days ahead for Yahoo and the Web in general?

Marketers are realizing that the Web is where their consumers are, that they live here all day long, that throughout the day, and into the evening, they're doing things on the Web.

We've gotten past the fact that we all dove in too deep the first time around. All of the major marketers that we're spending time with are coming back and are just saying -- you know what, we're past all of that now; tell us what we can really do. That's really exciting because all the stuff that we used to imagine is now actually happening.