Tipping the Scale
If ever I needed a reminder about what really matters to advertisers, I got it earlier this month at the tech-media-gadget-advertising-palooza otherwise known as CES in Las Vegas. Simply put, in the 30+ meetings Microsoft Advertising held with brands, agencies and partners during CES, there was one common denominator that coursed through each one: size matters. Or to be more precise, “scale” matters.
CES itself serves as a pretty good metaphor for scale. I didn’t go to CES to walk the show floor, or to demo new gadgets and technology. I went there because that’s where everyone was going to be. CES was a magnet attracting a lot of the most influential people in advertising – allowing me to efficiently connect with the people who matter most to my business, and listen to what they want from us.
It’s not unlike what media buyers go through when designing a media plan. They want their message to be seen by – and resonate with – the right audiences, at scale.
As we talked with advertisers and their agencies – all of whom are interested in how we can help them engage with large numbers of consumers – I pondered our own perspective of “scale.”
I think of scale in three ways:
- The sheer number of consumers with whom we have relationships;
- How we treat the data that consumers generate; and
- How we make the complexity of this scale simpler for advertisers.
First, let’s talk numbers.
We DO have scale… serious scale. More than one in seven of our planet’s inhabitants - about a billion people - touch, find, engage, play with, explore, produce, are entertained by, and get things done with Microsoft products and services. Here are some stats taken from our By the Numbers website:
· There are more than 76 million Xbox consoles worldwide.
· More than three million Xbox One units were sold in just the past month and a half.
· 100 million+ Windows 8 licenses sold to-date.
· More than a billion people use Office.
· 200,000 apps in our Windows Phone Store.
· MSN has more than 415 million unique users.
· Bing indexes more than 2 billion Facebook status updates and 500 million tweets every day.
· Over 250 million people are actively using SkyDrive.
· 300 million Skype users spend up to two billion minutes per day on the service.
· Outlook.com has more than 400 million active accounts.
That’s all well and good. But how are we doing at connecting all of these people in ways that allow advertisers to engage with them seamlessly and effectively, and in ways that those people also find valuable? As it turns out -- and as we have heard from many of our customers -- we can do better.
Our perspective on data.
For Microsoft, connecting the dots is more than a technical challenge. It’s also about a responsibility to our consumers and the way we think about doing business.
Earlier this month, Forrester released research (Forrester Research) that shows while innovation is one key to building a successful consumer technology brand, that alone is not sufficient. To quote Forrester:
“…While Apple and Samsung battle it out to reign supreme with the coveted Millennial generation, Microsoft has quietly stolen the consumer technology crown by becoming more trusted and essential across multiple generations…”
Note the words “more trusted.” At Microsoft, trust is something we do not put a price-tag on. Trust begets long-term loyalty, which in turn begets lifetime value. As marketers, you know that you don’t earn the trust of people who use your products and services by treating them like commodities simply because technology would allow you to do so. You earn trust by respecting consumers’ wishes, interpreting their signals and intentions properly, delivering value to them when they’re looking for it, and giving them space when they don’t want you around.
We apply this principle to our relationship with consumers. We could attempt to connect all the people who use our devices and services without their consent, and deliver the resulting scale (of potentially unengaged or dissatisfied consumers) to advertisers. But we choose not to do that. Trading trust to build scale is not in our DNA. Ultimately, we think connecting consumers who are really interested and engaged matters a great deal more. We think we can strike this balance between the capabilities of technology and the responsibility of consumer trust – they are not mutually exclusive.
Simple is good…we’re making progress!
As we go about our task of delivering greater cross-platform scale to both consumers and advertisers, I can tell you that the level and quality of our conversations within Microsoft about balancing the needs of consumers and marketers is very high. And we have some tangible progress on making things simpler for marketers.
Here are three recent examples:
1. We have made it easier for advertisers to utilize our entire portfolio of assets, including MSN, Xbox, Skype, Ads in Apps, Outlook.com and other devices and services. We recently completed a initiative for consistent “Creative Acceptance Policy” (CAP) standards among all Microsoft publishers, screens and services, meaning that 90% of all ad placements on Microsoft properties will use the same policies. Just a few months ago, that percentage was less than 50%... an ad that may have been accepted under MSN’s CAP policy, for example, may or may not have been accepted under Skype’s policy and vice versa. The remaining 10% are all unique ad opportunities, like specific sponsorships, which we think merited the exception and are worth the additional effort both for us and for marketers.
2. We have begun a similar project to optimize the number of different sizes and formats that advertisers have to deal with when they access our portfolio of screens, devices and services. In this case, less is absolutely more. Simply put, it is easier for an advertiser to assemble a campaign when they only have to develop a small number of standard ad sizes and formats than it is when they have to create a number of unique sizes to fit each site. We’ve heard directly from our customers on this, and we’re acting upon their wishes. I’ll keep you posted on this as we progress.
3. We continue to make progress on our Programmatic Direct initiatives, which we announced at Advertising Week in September. In fact, we are preparing to roll out pilots as I write this. Our goal with our programmatic offerings is to streamline and simplify the process by which advertisers purchase our premium display inventory. It will help both buyers and sellers focus less on the transactional process and more on content creation. Expect more details on our Programmatic Direct initiatives soon.
The combination of these three priorities – building scale, using data in powerful but responsible ways, and making things easier for marketers – can deepen our partnership and enable consumers and marketers to connect in ways which drive long-term loyalty to brands. You will be hearing more about these offerings and other initiatives in the months to come. In the meantime, know these two things:
We are listening to our advertising customers and acting on their desire for Microsoft to deliver greater scale across the breadth of our platforms.
We are committed to delivering that scale in such a way that does not in any way degrade the trust we have with the people who use Microsoft’s products and services every day.
As they say – watch this space!
Greg Nelson, General Manager, Microsoft Advertising