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Will Yahoo Fold Tumblr Ad Sales Force Into Larger Borg, Um, Org?

Other ad changes are expected with the appointment of new ad sales chief Lisa Utzschneider.

Despite a promise by CEO Marissa Mayer to let Tumblr stay Tumblr when it acquired it for $1.1 billion in early 2013, several sources inside the company said Yahoo is mulling a move to more fully integrate the sales force at the microblogging site into its larger global sales organization.

What that would mean for Tumblr’s global head of brand partnerships Lee Brown or the rest of the small advertising team is unclear. But sources note that one sales force would be more efficient, especially since Mayer projected to Wall Street in Yahoo’s third-quarter earnings call that Tumblr would bring in $100 million in revenue in 2015 and also have a profitable EBITDA (a measure of profitability that takes out a lot of costs).

The move seems to contradict Mayer’s statement at the time of the acquisition. “We promise not to screw it up. Tumblr is incredibly special and has a great thing going,” she said then. “We will operate Tumblr independently.”

To be fair, Yahoo has largely kept its big mitts off of the core Tumblr product and has bragged about using its technology to quickly roll out ad products for its own much-touted digital magazine efforts.

In turn, Tumblr has been using Yahoo’s ad tech and sales force, especially to beef up its sponsored posts, as it has grown its audience to over 400 million users and registered blogs to over 200 million. Tumblr has also recently launched autoplay video ads within user feeds using its nifty new social video player.

Efforts such as this are presumably where all the dough Tumblr is supposed to book this year is coming from, although the attribution of revenue is always a tricky and much-manipulated thing in online media. And since there are no comparisons — Yahoo has not given actual revenue figures on Tumblr since the acquisition — it’s easy to give it a lot of credit it might or might not be due.

One thing that is clear is that Mayer has touted, and will continue to tout, the impact of Tumblr on mobile and native growth across Yahoo, even if the standalone business has not been as lucrative as promised — part of an ongoing effort to justify the splashy purchase to still-dubious investors.

Speaking of eyebrow-raising about making big acquisitions, Wall Street is in rapt anticipation of what kind of tax plan is coming for its massive pile of money from Yahoo’s long-ago investment in China’s Alibaba Group that Mayer and her financial aide de camp Ken Goldman will propose in its fourth-quarter earnings call on Tuesday.

New moves aside, the possible ad-sales shift at Tumblr is against the backdrop of the appointment of former Amazon sales exec Lisa Utzschneider as head of sales in its key Americas market, reporting directly to Mayer.

While the addition of Utzschneider has sent some Yahoo sales execs into witness protection (paging ad tech and strategy SVP Ned Brody and solutions development VP Peter Foster!), the well-respected ad exec has been much more prominent on the ad scene. Many industry players said she has been open to listening to marketer complaints about Yahoo’s ad business, which is still suffering from Mayer’s disastrous hiring of former Google exec Henrique De Castro as well as a perception that Mayer is uninterested the ad business.

(Utzschneider was even cordial enough to say hello — though nothing more — to me at a party at CES, unlike most Yahoo sales dudes I know well who skitter away in some bizarre and juvenile mélange of fear and loathing.)

Now that she has been there several months, it’s likely she will begin a number of changes to the organization, which has seen major secular shifts in the advertising landscape recently.

That includes a massive move to programmatic — machine ad buying — native, sponsored content and mobile and away from premium display. Yahoo, of course, has long made its business in display and the company has been struggling with a rapid and dramatic falloff of revenue in the arena.

That includes hiring Kathy Kayse as a top ad exec, with the title of VP of sales strategy and solutions. Sources said the longtime and well-regarded ad veteran (the Oprah Winfrey Network, Time Warner) is also likely to play a significant role in key agency relationships, a move which is likely to mean more shifts with other top staffers.

The possible ad changes at Tumblr were first reported by Valleywag.

I tried to contact Lee Brown for comment, but the response was nada.

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