Microsoft CEO Steve Ballmer has said that the amount of money companies spend on digital advertising continues to grow, as do the opportunities to innovate.

Published: 04 Apr 2011

Microsoft CEO Steve Ballmer has said that the amount of money companies spend on digital advertising continues to grow, as do the opportunities to innovate.

“We’re just scratching at the surface,” said Ballmer, who spoke recently at Imagine 2011, the company’s advertising and marketing thought leadership conference.

The speed of innovation is accelerating like no other industry, which doesn’t always make life easy for marketers and advertisers, he said. “It’s like that line out of the Woody Allen movie ‘Annie Hall’ about relationships between men and women – relationships are like sharks, they either move forward or they die.”

Microsoft recently showcased the future of advertising opportunities via platforms such as Kinect, the PC and mobile phones, and “by using Microsoft technology to bring advertising to consumers in a way they like and voluntarily agree to consume,” stated the company.

This new shift in advertising is already happening, said Darren Huston, Microsoft’s corporate vice president of Consumer and Online at Microsoft, who pointed to Chevrolet Volt appearing in the Kinect game “Joyride” or an original web series from Wendy’s that appears on MSN. Microsoft is ready to help bring old and new brands into the new digital advertising world, and showing a concert over three screens at once is just one example of how the company can help advertisers, he said.

“For us, it’s important to connect consumers to experiences,” Huston said. “That is what’s driving us, and that’s what advertisers want – they want to follow the consumer. Having your message show up in different contexts is a very positive, almost multiplicative thing – in Xbox and Kinect, on MSN, on Bing. That funnel of awareness and consideration across multiple screens – advertisers want us to help them connect those dots.”

The company says it is connecting the dots for advertisers by using real examples of what they will be able to do, and not just in the future. For example, Microsoft Advertising helped client Toyota create an online series for MSN called, “Appetite for Life,” which features star Andrew Zimmern exploring the country in a Toyota Venza. The campaign included a Curbside Cuisine locator to help food enthusiasts find, track, and capitalise on the nation's latest craze: food trucks.

Microsoft Advertising wants to rethink and reinvent everything about digital advertising, from things as simple as banner ads, to better targeting and customising ad experiences for consumers to make them relevant, to creating cutting-edge experiences made possible by products such as Kinect, Huston said.

“Now that we have Kinect, what could we do with Pizza Hut to let people order a pizza using their hands, or with Macy’s to let them try on clothing using Kinect?” Huston said. “There’s a ton of innovation happening in our group, and it’s a growing and important part of who we are becoming as a company. It’s an absolutely critical business. We don’t just sell software licenses anymore.”

The future of digital advertising and marketing will, at its best, include experiences that are valuable both to advertisers and to consumers, said Stephen Kim, general manager of Global Creative Solutions for Microsoft Advertising. It’s a changing industry, and sometimes challenging to get companies to change their approach to how they market and advertise themselves.

“We want to show them what the possibilities are,” Kim said. “You can run a 30-second spot on television during ‘Modern Family’ and that’s great and reaches certain people. Or with the same budget, you can drive a deeper, more creative impact going digital, and that is something we’re well-positioned to demonstrate over the next few days.”

Travel sector

In an interview with EyeforTravel last year, Geraldine Madeira, head of Travel Industry Solutions, Microsoft Online, stated that even though online advertising technology has evolved as a branding tool, all travel advertisers haven’t evolved to completely see the benefits of branding online. With the development of technologies such as social media, rich media, dynamic creative and online video, there is no shortage of ways travel advertisers can build brand awareness and brand loyalty. However, many travel advertisers still hold online advertising to an ROI metric and not a brand metric.

Madeira said: “I believe travel marketers have to look at online advertising more holistically. I understand the need and pressure to drive ROI, but I strongly believe that combining brand and direct response together online is the key to success. Traditionally, online has been held to a much more stringent metric than offline channels and it is often bought with a very fragmented approach. We work with many clients who have separate search and display agencies. Within display, different teams work on distribution, traditional display, targeting and re-messaging. Some of the teams may or may not talk to each other. I believe that the right allocation of budget starts at the strategy level and is communicated to all teams involved. This sounds simple in theory, but does get complicated in practice among a variety of teams. Where I have seen the most success is when travel companies look at marketing in layers and are able to answer core questions like:

1. What are the core travel or audience sites that will be my foundation,
2. what targeting and re-messaging can I layer on to build reach and relevancy,
3. how am I incorporating my key search terms and
4. what emerging media (video, social, mobile, gaming, etc) can help compliment my overall media plan?”