Interview: MSFT’s Scott Howe: ‘Display Is Not The Problem; The Scoring Methods Are’
“I look like I’m in my Steve Ballmer uniform,” laughs Scott Howe, as he bounds off the stage following his keynote at the Interactive Advertising Bureau’s Annual Conference on Monday afternoon. As Howe heads backstage, one of the IAB reps points out all the Tweets by attendees remarking on his passing resemblance to the Microsoft (NSDQ: MSFT) CEO. Smiling, Howe shakes his head as dozens of “Ballmer “remarks scroll by on the IAB’s conference Twitter page.
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Over the past few years, Microsoft, like Yahoo (NSDQ: YHOO), has placed a big bet on display’s rising power to propel it as an online ad mover. Lately, though, the display space has seen nothing but struggles as the economy has worsened. Meanwhile, search has been looking ever-more healthy. In both his presentation and in conversation afterwards, Howe sought to address the pessimism surrounding display. Mostly, Howe wanted to get across a message: Microsoft is trying to refine its own strategy in the face of display’s heavy pressures.
Sandwiched between the motivational talk, Howe snuck in a pitch for Microsoft’s latest moves. One part included unveiling Microsoft’s Publisher Leadership Council. The second part will come next month, when Microsoft rolls out the Microsoft Media Network in the U.S. The network, which unifies the Microsoft Direct Response and Drive Performance Media networks into one, was quietly unveiled in Europe last month. The single network has 300 publishers, as well Microsoft brands like MSN and partners such as Facebook and CNBC.com. In addition to those new moves, I also talked with Howe about the state of display. More after the jump.
—Bullets and buckshot: The notion of the ‘silver bullet’ creative idea is gone; it’s been replaced by silver buckshot, Howe says, when asked about the role of creative agencies in the online age. A creative agency needs to focus on what is the central theme and then figure out how to translate that idea to other platforms, devices and and through an “evolving customer life-cycles,” he says. “In 20 years, there may well be some advertisers, like Coca-Cola, for example, that will always have the same basic, ubiquitous message for all consumers: drink Coca-Cola. But the vast majority of advertisers are going to have to become really adept at segmenting their messages.”
—Art and science: During his presentation, Howe fairly bristled when he alluded to MSLO co-CEO Wenda Harris Millard’s lament that Microsoft had choice of Qi Lu as digital head. To some at the conference, Millard’s comment about Lu, who is known for his engineering expertise—as opposed to a online ad exec like Brian McAndrews—was a signal of the higher regard for tech know-how versus creative acumen. I asked Howe whether Lu’s hire is illustrative of any change in focus for the company and the industry at large. Howe dismissed that notion. “[Lu] is a talented guy who understands the online advertising industry exceptionally well,” he told me. “I’ll go even further than that; he’s brilliant, he’s one of the smartest people I’ve ever met. He grew up in the search space. But understanding the algorithms and technology of search increasingly has direct applicability to display ads, around targeting, optimization. Ultimately, those things are software engineering problems. On the other hand, the challenge of creative ideation will depend on the marriage of the science and the art in trying to get the best outcomes for our clients.”
—Who made these rules?: One of the reasons display seems so down is that the scoring—i.e., click-throughs—is better suited to search than a branding campaign associated with display, Howe said. I asked if the score has been set that way because one particular company, Google (NSDQ: GOOG) and its product AdSense, is overwhelmingly dominant in the online ad sphere. Howe side-stepped an offer to blame Microsoft’s chief rival, saying instead, “This industry shouldn’t feel bad about anything. At the end of the day, we have to keep things in perspective. The economy around us is bad and the ad sector is being hit hard. Within that online is still a bright spot. Eyeballs are still moving to online media, and in many sectors, spending is increasing dramatically. And so, yes, is it disappointing, absolutely; is it a catastrophe? Absolutely not. This is just a bump in the road to where we’re going – and that is to a world where advertising is digital and media is accountable, allowing creativity to flourish. As to your second question, we believe in a world where competition is encouraged and recognized as good for the industry. Conversely, one in which monopolies flourish and innovation is stifled is clearly bad.”
Posted In: Advertising, Marketing, Companies, Microsoft, scott howe
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