In a shift that is sure to be much commented on by the advertising industry, Yahoo has tapped Goodby, Silverstein & Partners to take the lead for creative, advertising, digital marketing and strategic planning efforts.

The San Francisco-based Goodby, which is owned by the Omnicom Group (OMC), is known for its innovative ideas and has done such memorable campaigns as the Slowsky turtles for Comcast (CMCSA), the weird folk of Emerald Nuts, owned by Diamond Foods (DMND)–as well as campaigns for tech companies such as Hewlett-Packard (HPQ), Adobe Systems (ADBE) and Netflix (NFLX).

Also, of course, the terrifically memorable “Got Milk?” campaign.

Perhaps a “Got Yahoo?” campaign is in the future?

Until now, the top job of goosing Yahoo’s tarnished brand, as part of a recently launched $100 million marketing push, has been helmed by Ogilvy & Mather, a unit of the WPP Group (WPPGY).

While Goodby will lead on creative initiatives worldwide, Ogilvy will remain in the mix, Integrated Marketing and Brand Management SVP Penny Baldwin told BoomTown in an interview this afternoon, focusing on international marketing efforts, including all upcoming brand launches in France, Taiwan, Hong Kong, Korea, Brazil and Indonesia.

And, via it Neo and Mindshare units, Yahoo said, Ogilvy will also run all media buying for the Internet giant globally.

Yahoo (YHOO) is also keeping strategic branding firm Landor & Associates.

Goodby, Ogilvy and Landor will apparently form a Brand Advisory Board at Yahoo, run by Baldwin.

Baldwin stressed that the move was a broadening of its outside marketing advisers and was not a replacement of Ogilvy, or any indication that the current new marketing campaign needed to change.

She said internal reports on the effectiveness of the overall big theme, “It’s Y!ou,” launched last month, have been strong.

Nonetheless, Baldwin added that the new agency is sure to bring more ideas to the mix in the massive effort, which has included television, print, outdoor and online ads.

And, she noted, the location of Goodby’s HQ in San Francisco, not far from Yahoo’s Sunnyvale digs, was also a plus.

“Goodby has the caliber to serve worldwide needs,” said Baldwin. “And with the way the Web moves so fast, we thought it was also important to have deep resources locally.”

Up next, she added: to “root our brand strategy with more hard-hitting” messages about Yahoo.

“This is far more than just an advertising effort,” said Baldwin of Yahoo’s efforts to revitalize itself in the eyes of consumers–and, while she did not say so, to the digerati of Silicon Valley. “This is a business transformation.”

Here is Baldwin’s boss, Yahoo CMO Elisa Steele talking about the company’s marketing efforts of late in a video interview with Nicki Dugan on the company’s Yodel Anecdotal blog in a new feature called Yodelcast (sorry, Nicki, but it is simply too professional and unjiggly for BoomTown’s seal of approval):

And here are two examples of Goodby’s creatives–Comcast’s Slowskys and Robert Goulet for Emerald Nuts:

After all the investor hubbub over the oh-no-they-didn’t deal between Yahoo and Microsoft starts to die down a bit, the pair are now embarking on the path that is the only way toward proving the efficacy of them joining together.

That would be getting a variety of state, federal and international regulators to say yes to the wide-ranging online advertising and search arrangement they announced last week so they can start making it work.

According to sources at both companies, a variety of filings will be made this week, including one to the Securities and Exchange Commission that should provide more details of the partnership.

When it was unveiled last Wednesday, the companies said Microsoft (MSFT) will run search technology for the two, while Yahoo (YHOO) will sell the premium search advertising.

That SEC filing could answer a number of questions some still have about the deal, such as whether there is a large break-up fee that Microsoft would pay Yahoo in case the deal is scuttled.

That’s just the outcome that Microsoft and Yahoo are trying to avoid.

“We think of it as an outreach effort to explain how we are creating a strong No. 2 to Google,” said one source close to the situation. “The main goal will be to show that a better competitor in the marketplace is a good thing.”

While the companies are prepping for opposition from Google (GOOG), sources close to the thinking at the dominant search company said it is more likely to be muted and indirect.

That’s especially true since a MicroHoo makes Google–currently under a lot more government scrutiny than ever before–look like less of a bully.

Thus, Google’s tactics would entail less direct statements and more pointing out the discrepancies between what Microsoft said when Google tried to get approval for a search deal with Yahoo last year and what it argues now.

“They will probably not be that obvious, but they will be there still,” said Microsoft CEO Steve Ballmer to me, in an off-hand remark at the software giant’s Financial Analyst Meeting last week.

It’s a game of legal chicken that Ballmer knows well.

Already, for example, Microsoft and Yahoo execs have been aggressively reaching out to major publishers and advertisers to get their staunch support.

That included calls immediately after the deal was announced last Wednesday to such execs as Martin Sorrell of the WPP Group (WPPGY) and Jeff Zucker, CEO of NBC Universal, a unit of GE (GE).

In Washington, D.C., both companies have legions of lawyers to try to make sure the Justice Department, which will review the case due to its antitrust implications, has all the information it might need.

And, more to the point, they want to avoid the debacle that took place when Yahoo and Google tried to get approval for their failed deal last year.

That deal was ended by Google after it became clear that Justice was going to fight it by arguing that top search companies hooking up hurt competition and stifled innovation.

In addition, there might be Congressional scrutiny, with possible hearings, similar to those held when the Yahoogle deal was pending, such as in the Senate Judiciary Antitrust Subcommittee.

And, of course, there are actually independent groups concerned and they have also been in contact with regulators.

“There are questions that must be answered regarding the collection and sharing of consumer data by the two companies,” said Jeff Chester, executive director of the Center for Digital Democracy, a D.C.-based group that works to promote consumer privacy and protection online, in a statement last week. “While the rationale for the deal is to provide some much needed competition to Google (and income for Yahoo), the further consolidation of the global digital advertising system should be a concern to Internet users, privacy advocates, online marketers, and competition regulators.”

Sources said Microsoft and Yahoo also plan to petition regulators in the European Union this week, which is likely to be most concerned about privacy issues involved in their union.

They will also be doing the same in other key countries worldwide, such as Korea, Taiwan and Brazil.

And, finally, given how involved state attorneys general became in beaching the Yahoo deal to partner with Google, they also will be starting outreach to key states, such as California, where Silicon Valley-based Yahoo is headquartered.

“Once again, it will be the Lawyer Employment Act of 2009,” joked one person close to the deal. “At least, that shows there is some economic benefit to this deal already.”

While we all wait in breathless regulatory anticipation, here are interviews I did at last year’s Senate hearings on Yahoogle, with lawyers from Google (David Drummond), Microsoft (Brad Smith) and Yahoo (Mike Callahan).

Incredibly, they are the very same lawyers who will be pretzeling themselves in entirely different shapes than they pretzeled themselves a year ago.

I would expect nothing less!

Here’s the video:

]]> http://kara.allthingsd.com/20090804/yahoo-microsoft-regulatory-filings-begin-this-week-let-the-legal-game-playing-begin/feed/ 0 http://kara.allthingsd.com/20081031/is-google-playing-chicken-with-the-justice-department/ http://kara.allthingsd.com/20081031/is-google-playing-chicken-with-the-justice-department/#comments Fri, 31 Oct 2008 08:12:02 +0000 Kara Swisher http://kara.allthingsd.com/?p=5909

Are Google and Yahoo thinking of walking of away from their controversial search advertising deal, as reported in an amusingly hedged report in The Wall Street Journal last night?

How’s this for covering your bases in a story: “Following a meeting Thursday with the Justice Department, the companies could announce a decision to back away from the partnership–or a last-minute resolution, if one is reached–by the middle of next week, according to these sources.”

So they will back away unless, of course, they don’t and soon?

I would bet my Barry Manilow record collection, based on rumblings on Wednesday among those close to the case, that Google (GOOG) is a key whispery source here, sending a very public signal to the Justice Department that it would walk if pushed too far and leave regulators with egg on their faces for not letting the search giant help the struggling Yahoo.

But, let me be even more concrete, since The Journal report is dead wrong on at least one count. I can tell you for sure, based on many sources close to Yahoo (YHOO) that walking away is its last option, outside of a lawsuit, and it still hopes to make the partnership work.

That was underlined last night in a statement by Washington D.C.-based Yahoo spokeswoman Tracy Schmaler:

“We have been working with the Department of Justice regarding our agreement with Google and those discussions are ongoing. As we have said, we believe strongly that this agreement will strengthen Yahoo!’s competitive position in online advertising and will help to drive a more robust, higher quality Yahoo! marketplace for our advertisers, publishers and users.”

And I do not believe she is spinning here, even though that is her job.

Indeed, Yahoo can ill afford to pull out so easily, because it needs the revenue the deal might provide and simply cannot take the hit to its stock the collapse of the partnership would entail.

Such a series of one-two punches after its already tumultuous year would be devastating. It would also put Yahoo in the direct crosshairs of Microsoft CEO Steve Ballmer as its only partnering alternative in search.

Going it alone, of course, while preferable, is no longer an easy option for Yahoo, since keeping its No. 2 position in search would be expensive and brutal, especially sandwiched by No. 1 Google and No. 3 Microsoft (MSFT).

And, even more vexing, several sources at Time Warner (TWX) told me they are waiting until the resolution of the Yahoogle situation before consummating the ongoing merger discussions with Yahoo, because of the uncertainty of the impact on the Internet giant.

“It is linked to and just overhangs everything,” said one Yahoo exec about the long-pending Google partnership. “We want and need this deal, and would not be the ones to walk away first.”

As I have written, that would be Google, which benefits a lot from the will-they-or-won’t-they speculation here and cannot mind letting its intentions get some play (along with state attorneys general, who were also present at the Thursday meeting, and for whom leaking for simple self-aggrandizement is a basic character trait).

In fact, there was already much chatter that reached me on Wednesday that Google was sprinkling crumbs here and there to the media pigeons, all centered around the fact that it might balk at any onerous Justice Department demands, such as caps on search it could serve, or a consent decree that would require monitoring.

The Journal story mentioned the consent decree, which would be welcomed at Googleplex in Mountain view, Calif., like nonorganic mango nectar and bleached flour. The idea of regulators ferreting around its servers is simply not an option for the secretive company.

As I wrote early yesterday about the possibility of Google walking, in a predictive laundry list of options for Yahoogle earlier yesterday:

It seems far more likely that Google would do this than Yahoo, given its corporate culture is impatient with moving forward illogically (think Spock and you have the right picture of Google’s mindset).

I would imagine Google execs do not want to accept any caps or changes to the deal at all, and might conclude such restrictions make it not as worthwhile…

Plus, the joy of government regulators breathing down your neck 24/7 is, well, priceless, especially after Google CEO Eric Schmidt told regulators he would move forward with or without them.

While Google has now perhaps permanently put the government on notice that is must be more scrutinized than ever going forward with that unfortunate statement, I would be surprised if Google accepted any substantial changes to the deal.”

And, while it might be testing the Justice Department in hopes of salvaging the deal, I suspect Google–as much as its founders want to help out Yahoo CEO Jerry Yang and block Microsoft at the same time–is just now figuring out that walking might actually be the best move.

First off, even though it moved forward with the partnership, many top execs at the company were dead set against it, mostly due to the undue scrutiny it would bring to Google.

In fact, early on, some of its own operatives in D.C. expressed worry–largely ignored at HQ, where execs really do see themselves as not evil–about Google’s growing image as a scary behemoth.

Second, while Google seldom runs from a good fight–in fact, it often runs directly towards them–tangling with the federal government might be like crossing the 38th Parallel in Korea for the company. And you know how that went for General Douglas MacArthur!

It would certainly put the full attention of regulators on every move Google might make in the future, which is not good.

Third, the Yahoogle controversy, while being stoked by Microsoft’s relentless lobbying, has also brought into the light exactly how scared of Google’s power advertisers truly are.

And that would be terrified.

The company cannot simply blame Microsoft for manufacturing this fuss–even though it has surely pulled out all the stops in its bag of tricks.

In truth, whether Google chooses to accept this stark reality or not, many advertisers, publishers and public interest groups have been raising some real concerns about its dominance, which it ignores at its peril.

Lastly and perhaps most importantly, times have changed drastically as the economy has tanked.

Thus, Google–like a lot of other tech firms–has been engaged in a very serious company-wide appraisal of its business in the downturn.

One of Google’s internal mantras, I have been told by many inside and outside the company, is a variation of this phrase: Feed the winners, starve the losers.

It would come as no surprise, given the initial internal doubt about the partnership, that the Yahoogle deal might have suddenly become perceived at the company as a loser, and access to Google’s fabulous cafeteria might be about to be cut off.

Whatever Google’s true intentions, in playing chicken, it is courting danger.

According to Wikipedia, “the principle of the game is that while each player prefers not to yield to the other, the outcome where neither player yields is the worst possible one for both players.”

As in, if everyone is trying to win, it always ends in a fatal crash.

Please see this disclosure related to me and Google.

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