Talk about old media!

By hiring a

Reader's Digest

(RDA)

publishing executive to head up North American operations, new media bellwether

Yahoo!

(YHOO)

appears to be taking to heart Wall Street's concerns that it needs to strengthen its ties to the old-media advertising community.

While the Reader's Digest executive, Gregory Coleman, is getting an unofficial vote of confidence from consumer products giant

Procter & Gamble

(PG) - Get Report

, one longtime media analyst calls Coleman a less-than-obvious choice if advertising is Yahoo!'s top concern.

Yahoo!'s shares were off 56 cents, or 3.8%, to $14.38 in afternoon trading Tuesday. Coleman, who's slated to start at Yahoo! in late April, wasn't available to comment.

The company, which is suffering a stomach-turning

free fall in first-quarter advertising revenue, and which has endured a string of

high-profile executive departures, is under pressure from Wall Street to build revenue back up to the venture-capital-fueled, advertising-driven heights of 2000.

Coleman's mission, according to Yahoo!, will include overseeing the company's sales, marketing and client services organizations, and managing all of Yahoo!'s consumer services and programming initiatives. He'll report to Yahoo! President Jeff Mallett.

As president of U.S. magazine publishing at Reader's Digest since 1998, Coleman has presided not only over the company's flagship publication, but also titles such as

Walking

,

The Family Handyman

,

New Choices: Living Even Better After 50

and

Reader's Digest Large Edition for Easier Reading

.

Coleman's immediate background doesn't quite match Yahoo!'s advertising needs, says Dennis McAlpine, director of research at

Auerbach Pollak & Richardson

. He points out that

Reader's Digest

relies less on advertising, as a percentage of revenue, than the average magazine, and says that the other magazines in the stable aren't in a Yahoo!-esque mainstream, either. "Those are special-interest, not general-interest, magazines," McAlpine says. "He's not someone I would look to immediately as a savior on advertising."

But that's not to say that Coleman is a babe in the advertising woods. He's worked in the magazine business at Reader's Digest since 1990, and previously spent 10 years working in advertising sales for

Woman's Day

. "He knows the industry. He knows the people," McAlpine says, calling him "a bright guy who's been around." (McAlpine doesn't cover Yahoo!, and his firm hasn't done underwriting for the company.)

In fact, Procter & Gamble Global Marketing Officer Bob Wehling says he's optimistic about what Coleman will be able to do for Yahoo!. "I think he's a very, very strong, strategic thinker," Wehling says. "I'm quite positive he'll make a significant contribution in this new role." Wehling says that most of his contact with Coleman has been at the

Advertising Council

, an industry nonprofit in which Coleman succeeded Wehling as chairman.

Wehling downplays the possibility that audience demographic differences between

Reader's Digest

and Yahoo! might be a hurdle for Coleman. "It's all a communications business," Wehling says. "No matter what end of the communications business you're in ... it's all about making strategic decisions and connecting with your target audience in a deep and strategic way, and offering your consumers a good value. That's kind of the skills he brings to the party. They're transferable from one medium to another."

As for advertising with Coleman at Yahoo!, Wehling says that P&G has already concluded that banner advertising on Yahoo! and elsewhere "wouldn't take us to glory," and he believes that Yahoo! understands that, too. "The vendors in the business like Yahoo! and the advertisers like P&G are all learning and growing as we move to a better place together," Wehling says.

Magazine consultant Martin Walker says he thinks Reader's Digest is a pretty close analogue to Yahoo!. "It's

TV Guide

," he says. "It reaches everybody."

Whatever the percentages,

Reader's Digest

has significant advertising revenue, Walker says. And because ad rates in the magazine are so expensive, Coleman is used to calling on the largest advertising clients. "You have to have a lot of money to advertise in

Reader's Digest

," Walker says.