Two years ago, Tim Armstrong replaced the ad chief he inherited, Greg Coleman, with one of his former Google lieutenants, Jeff Levick. The musical chairs still has not stopped. In a memo sent out to employees today (see below), Armstrong announced that Levick wil be stepping down, to be replaced by another trusted lieutenant, Ned Brody, who will take the new position of Chief Revenue Officer and President of AOL Advertising. He was previously COO of the media, advertising, and commerce group, as well as the president of AOL’s Paid Services group before taking over the Advertising.com group.
Most of the shakeup is happening in the sales organization, which is getting five new SVPs under Brody, who is charged with delivering consistent growth in advertising revenues and pushing AOL’s premium ad products such as Project Devil. Last quarter, total advertising revenues were still declining by 11 percent, although there was a ray of hope in that display advertising saw a 4 percent jump. Brody needs to keep growing the advertising business before older revenue streams dry up.
Meanwhile, AOL’s head of PR, Lauren Hurvitz, and head of HR, Kathy Andreasen, are also leaving. All of these changes are happening ahead of AOL’s second quarter earnings, which won’t be announced until August 9. (The stock is down a bit on the news).
On the editorial side, AOL now has five new general managers, including our own Heather Harde (who heads up AOL Tech, which includes TechCrunch and Engadget). At AOL, the GMs run the business, the editors run the editorial (so, for instance, Arianna Huffington, is stil the editor in chief). Those five GMs are:
• AOL.com – Chris Grosso
• Huffington Post – Brian Kaminsky
• Entertainment – Kerry Trainor (e.g. Moviefone, AOL Music)
• Marketplace – Jay Kirsch (e.g., AOL Autos, Finance, and AOL Industry)
• Tech – Heather Harde (e.g., TechCrunch, Engadget)
AOL is also trying to focus its business and brands. According to Armstrong’s memo, AOL’s growth strategies are now centered around:
1. Leading the digital content space
2. Leading the brand advertising space
3. Leading the premium video platform space
4. Leading the local content and advertising space
5. Leading the online membership services space
That is still probably two things too many. Investors are losing patience with AOL, which so far is not participating in the broad rally in online advertising revenues the rest of the industry is enjoying (well, except Yahoo, which isn’t doing so great either). At this point, management changes won’t really matter unless they are followed up by results.
Full memo below:
AOLers –
As we continue the comeback of AOL we are focused on growth. We have a few announcements today that will make the company simpler, faster and stronger. Our strategy remains clear and consistent and our execution and operational clarity have improved. We have stabilized the foundation of the company and our future is about executing our growth strategies focused on:
1. Leading the digital content space
2. Leading the brand advertising space
3. Leading the premium video platform space
4. Leading the local content and advertising space
5. Leading the online membership services spaceAs we have focused our growth in this simplified product portfolio, we are now combining our advertising sales organization with our advertising network and products organization. We are not watching trends in the advertising business, we are creating them. Project Devil has traction and will help lead the brand space online. In the video space, we have gone from being out of the race to becoming one of the largest forces for digital video distribution.
The first announcement is a global structural change to our advertising business. We are promoting Ned Brody to the new position of Chief Revenue Officer and President of AOL Advertising. Ned will oversee AOL’s global O&O advertising, global network business, sales, and advertising and publishing products. There are three goals we are hoping to accomplish with Ned in this new position. The first is a unified premium strategy for advertisers and publishers. The second is consistent growth in advertising spend across all our properties and networks. The third is a more rigorous approach to advertising and publishing system design. This will allow us to connect Project Devil and our Premium Brand Formats to the O&O properties as well as the network.
In addition to our new CRO position, we are also announcing expanded leadership roles for five world-class leaders in our sales organization. Tim Castelli, Wendy MacGregor, Tim Richards, and Jim Norton will be promoted to SVP and Michael O’Connor will be promoted to VP, Head of Sales Operations. These leaders along with Don Kennedy, SVP of Advertising.com Sales, and Chris Heine, SVP of Advertising Operations will form our sales leadership team and join Ned’s management team.
As a result of this global change, Jeff Levick will be leaving AOL after a six week transition period. Jeff undertook one of the toughest jobs in the Internet space when he joined AOL. In the past two years, he developed a world-class leadership team, led the industry toward the future of premium formats for brand advertising, and helped lead a game-changing shift in perception and quality of the AOL advertising experience. Jeff is a friend to many of us and we know we will see big things from him in his future career. We have been working closely together on the design of the sales structure and we both believe it will positively impact results for our team and our customers.
The second announcement we are making is a streamlined GM structure reporting directly to me, overseeing the connection between content and monetization. The GM organization will allow us to profitably manage our investments in media and optimize the yield opportunities with traffic and revenue. We have already put the following GM leaders in place:
• AOL.com – Chris Grosso
• Huffington Post – Brian Kaminsky
• Entertainment – Kerry Trainor (e.g. Moviefone, AOL Music)
• Marketplace – Jay Kirsch (e.g., AOL Autos, Finance, and AOL Industry)
• Tech – Heather Harde (e.g., TechCrunch, Engadget)Our third announcement is aimed at streamlining our corporate operations. Artie Minson, CFO of AOL and President of Paid Services, will now take on managing both our international planning and our Google search relationship, which is an important partnership on many levels. As part of Artie’s new responsibilities, he will be transitioning HR, Corporate Communications, and Marketing back to me.
We will be consolidating all marketing functions and the corporate communications team into a single organization run by Maureen Sullivan. Lauren Hurvitz will transition out of AOL as part of the consolidation. Kathy Andreasen is also transitioning out of the company. Lauren and Kathy have been big champions for AOL and trusted members of the management team. Sandy Mott will assume the role of interim head of HR. We will also be opening up a search for a Global Head of HR.
The future for AOL is getting brighter and we are on the path of returning AOL to growth. I care about our team and our AOL brand, our consumers and customers, and our long-term outcome – the announcements today have this at the core.
We have very clear operating plans for the second half of the year as we reviewed on the all-hands call a few weeks ago and we review detailed updates every week, and in some cases daily. We won’t be hitting the pause button this week, we’ll be on fast-forward.
Photo credit: Makelessnoise