REDMOND, Wash. – May 20, 2008 – As advertising leaders from across the world gather this week for the advance08 Advertising Leadership Forum, PressPass spoke with Brian McAndrews, Senior Vice President, Advertiser and Publisher Solutions, about how the changing digital advertising landscape, and how Microsoft Advertising solutions and offerings will help advertisers, agencies and publishers reach increasinly fragmented audiences online.
PressPass: It’s almost exactly one year since Microsoft announced it was acquiring aQuantive. What have been some of the biggest challenges and accomplishments in the past year?
McAndrews: Integrating the two companies while continuing to execute and innovate at the pace we have over the last 12 months was certainly a challenge, but one that our employees have managed remarkably well.
Brian McAndrews, Senior vice president, Advertiser and Publisher Solutions
Over the past year, we’ve signed nearly 100 new publishers to the Microsoft platform. We reached advertising partnerships with a number of leading publishers including CNBC.com, Digg, EDGAR Online, Facebook, IAC, Viacom and the Wall Street Journal Digital Network.
We have also made several strategic acquisitions to enhance our digital advertising platform, including the ad exchange, AdECN, which closed the same day as aQuantive, the behavioral targeting company YaData, and Rapt, a leading provider of advertising yield management solutions for agencies and publishers.
We also launched Engagement Mapping, a new standard in digital campaign management that allows advertisers, agencies and publishers to map and assign value to the various touch points a consumer is exposed to during their online experience. All of this has helped our top-line ad revenue growth, which has outgrown the industry for the past four quarters, while uniquely positioning us for the long term.
I’m very pleased with what we’ve been able to accomplish while integrating the two organizations. It’s a testament to the people in our organization. We’re all feeling very optimistic about the opportunities that lie ahead.
PressPass: As the digital advertising business continues to evolve, what are the key areas of improvement for Microsoft Advertising?
McAndrews: While we’re doing a lot of things right, we’re also hearing from customers that we need to get better in a few key areas. We need to deliver better ROI to our customers by continually improving the quality of impressions, which in turn, will increase conversions. Secondly, we need to demonstrate stronger industry leadership by continuing to improve our creativity and innovativeness. And finally, we need to constantly work to enhance our industry expertise, constantly focusing on our clients’ businesses to provide tangible solutions to their problems. We are committed to addressing the most prevalent issues quickly and to continuing to foster dialogue about what our customers need, and what we can and should be focusing on to help them succeed.
PressPass: What are some of the products and new technologies we can expect to see in the coming year?
McAndrews: We have our sights set on bringing new solutions and services to market that will have a direct, positive impact on our customer’s businesses. For instance, with our acquisition of Rapt now closed, we are starting to fold their advertising yield management solutions into our Atlas division as a key component of the Atlas Suite of technologies and services. We are also working to deliver connected experiences for consumers that enrich and simplify entertainment, information, and communication experiences at home and on-the-go across multiple devices and environments, giving advertisers new opportunities to reach and engage audiences.
Since unveiling the Engagement Mapping concept three months ago, we’ve been running beta tests of the Engagement ROI product with a number of customers, and the early results confirm what we have believed for quite some time: that there is a superior way to measure and optimize digital media spending. The prevalent last ad standard is flawed and essentially ignores 90 percent of the data that is important to advertisers. In one campaign, a beta customer discovered a 33 percent increase in conversion credit to their display campaigns, while also finding a 60 percent reduction in conversion credit to search. In the coming months, we will extend the Engagement ROI product for wider distribution, so that eventually all of our customers will have a more accurate way of measuring the totality of their digital campaigns.
In the next year, customers will also see the benefits of our unified sales force, which can better focus on holistic solutions, as well as specialty expertise. We will also be driving game-changing innovations in other areas, including search which will attract customers and grow share. There are literally dozens of other initiatives and projects we’re working on that will directly benefit our customers over the coming months.
PressPass: The “Microsoft Advertising” brand name you announced today sounds like a one-stop shop for digital advertising. How does it benefit advertisers, agencies, and publishers?
McAndrews: Microsoft Advertising – as simple as it may sound – is the new brand identity we have chosen to unify all of the tools and solutions we offer advertisers, agencies and publishers. It’s designed to let customers know that we’re committed to making sense out of a complex environment, and that we have everything they need, all under one roof.
Our talented and dedicated people are committed to helping customers make sense out of a complex environment and develop solutions to solve problems, not just share a rate card. We provide the tools and services that provide customers with critical insights about their business and consumer reactions to run more effective campaigns. Through our partnerships with advertisers, agencies and publishers, we can continue to innovate in the marketplace. The success of our business is dependent on us thinking about our clients every single day, and whether they’re advertisers or publishers, they have a shared priority – how to best use media and technology to connect with audiences that are becoming more fragmented every day.
PressPass: How does a company like Microsoft continue to drive innovation in the online advertising industry?
McAndrews: We believe that innovation in the industry is driven by customers – it always has been. In fact, every innovation we have come up with started with a customer having a problem they needed to solve or an opportunity that could be tapped. Our customers – advertisers, agencies and publishers – provide the big ideas and challenges, and we provide the tools and technology that enable them to move forward. Our new Engagement Mapping tool for example, which I talked about earlier, is a perfect example of an innovation to solve a real-world problem that came straight from a client. We highly value the feedback from our advertiser, agency and publisher customers and seek open and honest dialogue with them. If they have a complex challenge, we see it as our job to build tools that will help solve it.
PressPass: As audiences continue to become increasingly fragmented, how can advertisers better target and engage with consumers?
McAndrews: The issue of fragmentation is the central challenge in our industry today. Our clients are pursuing elusive consumers who are fragmented across a diverse set of digital media properties, from the home page of MSN to a niche golf blog they visit. Similarly, the solutions for reaching those consumers are also fragmented with diverse tools and firms offering disconnected and inconsistent views on the marketplace. It’s our charter to bring order to this chaos by providing performance, insight and expertise to make our customer’s businesses successful. We’ll continue to provide the tools and services to run more effective campaigns, information into how to best engage with consumers, and offer solutions to solve our customer’s problems.