Microsoft streamlines ad strategy

In a move aimed at making it easier for customers to purchase advertising from Microsoft Corp., the company Monday unveiled an organization that aligns all of its advertising sales, research and planning efforts.

The Microsoft Digital Advertising Solutions team — which falls under the division overseen by Kevin Johnson, Microsoft’s Platforms & Services — gives customers one group within Microsoft for all of their advertising needs, said Eric Hadley, general manager of global marketing for Microsoft.

The organization comprises former MSN advertising sales employees as well as others involved in advertising at Microsoft across other divisions. The company also has been hiring employees to fuel its advertising efforts, and they will join the new division, Hadley said.

Until recently, Microsoft’s MSN site was the only place where the company offered advertising, Hadley said. But in the last 18 months, the company has built out a portfolio of products that offer a range of advertising options, such as Xbox Live as well as its Windows Live and Office Live Web-based services.

“Advertising is now a core asset across all aspects of the company,” Hadley said. Microsoft realized it needed to unify how customers could purchase advertising across all of these properties for a comprehensive advertising plan, he said.

Microsoft Chief Executive Officer Steve Ballmer has expressed his intent on more than one occasion to overtake competitors Google Inc. and Yahoo Inc. in the online advertising market. Microsoft has said it plans to spend US$500 million in its current fiscal year to expand its online business, with a big focus on increasing advertising sales.

Eventually, Microsoft’s adCenter platform will play a big role in helping to streamline Microsoft’s advertising efforts, Hadley said. Right now, the platform, which Microsoft launched in the U.S. in May, offers only sales of keyword searches. But eventually adCenter will allow customers to purchase advertising across all of the Microsoft properties that offer it, he said.

In its last quarterly earnings call in July, Microsoft said it was not seeing a big uptick in revenue yet from adCenter, and skeptics are doubtful the company will be catching up to competitors in online advertising revenue anytime soon.

However, Hadley said Monday that Microsoft is seeing “a lot of growth” in sales through adCenter, and believes that the formation of Microsoft Digital Advertising Solutions will help support this trend.

“You know with Microsoft — we don’t always get it right right from the start, but we feel we’re going in the right direction by aligning all the company assets behind advertising,” Hadley said.

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