Costello, a former marketing executive at Sears, Roebuck and a former president of sports e-tailer MVP.com, will work with company President Jeff Mallett to direct global brand strategy and develop and promote new strategic initiatives, including consumer subscription services, according to Sunnyvale, Calif.-based Yahoo.
Costello, who has been acting as a consultant to Yahoo since August, will also work with Greg Coleman, executive vice president of North American operations, to bolster the company's marketing campaigns in North America and develop more effective marketing packages for clients.
The appointment comes a month after Yahoo hired Wenda Harris Millard as head of advertising sales, filling a longtime vacancy left by former ad sales chief Anil Singh. Like Millard, Costello is charged with directing product development and advertising initiatives during a severe online advertising drought.
"At the top of my list is evolving a strong Yahoo brand to make it even more relevant to consumers, working with our businesses to develop the most powerful breadth and depth of consumer offerings, and working with Yahoo sales and our clients to develop even more effective marketing solutions," Costello said.
But analysts say that of all those tasks, Costello's highest challenge will be to augment revenue from new for-fee services.
"Yahoo has a strong brand--that's maintenance mode. His assignment there is don't screw it up," Forrester Research senior analyst Jim Nail said.
"The most important part of his new job is the product development in subscription services. That's Yahoo's weakest area--the one area where Yahoo needs, if not to hit some home runs, at least get some extra bases," he said.