NEW YORK (AdAge.com) -- It's been nearly two years since Microsoft has had a global head of advertising sales. During that time, losses at its internet division, which includes MSN, Bing and all its other ad-supported properties, ballooned to $713 million in the most recent quarter from $411 million a year ago.
Microsoft's latest executive hire, Carolyn Everson, former MTV Networks' COO and exec-VP for strategy and operations, is expected to change that. Ms. Everson has worked at Viacom since 2007, but she has an internet pedigree, having managed web operations for Primedia and Zagat, combined with cable TV experience. She also knows Microsoft, having spearheaded Viacom's $500 million multi-year advertising deal with the company at the end of 2007.
Microsoft has always had an identity problem when it comes to selling advertising, but it comes to the party with a few unique advantages. It is one of few media owners of any type with a truly international footprint; it has a portal with scale, a gaming platform in Xbox, a nascent search brand in Bing and a collection of complementary online ad technologies. It is also the only global ad player that is also a huge buyer of advertising, spending close to $1 billion on measured media in the U.S. alone. Can Microsoft actually make money on the web? We asked Ms. Everson.
Ad Age: In an age of Foursquare and Facebook, what's Microsoft's unique selling point to marketers?
Ms. Everson: I have been a fan of the company from a variety of different perspectives, as a consumer, as a partner [as part of the Viacom advertising deal] and as a member of the advertising industry. From my perspective, using all of Microsoft's screens and touch points are things I see marketers wanting to do every day. They want to understand how to seamlessly move a campaign across platforms. I think that is essential, and Microsoft is uniquely suited to doing that.
Ad Age: Is it important for Microsoft to have a global head of sales? What happens then to the regional sales operations?
Ms. Everson: Marketers are getting more global. A campaign might be relevant for the region, but can it work from a global point of view? I think the economy in 2009 put a lot of pressure on marketers to not have 60 different marketing plans and 60 different execution elements across the globe. All these ways we used to work in the industry worked when we had a better economy, but there has been significant pressure for cost reductions among marketers. Over the last few months when I started talking to Microsoft, it became clear that they were deciding what the role was and that all the regions would report into it.
Ad Age: Microsoft has always been a confusing proposition for marketers. It has massive scale, but few strong brands. How do you fix that?
Ms. Everson: I think Microsoft needs an ambassador to the advertising industry, and that is one of my most important roles, to clearly articulate what Microsoft can do for its marketing partners. The fact they are a big marketer themselves is a strength. We talk the talk and walk the walk. Microsoft is making decisions every day on how they allocate marketing funds. I am eager to tap into partners on the marketing side to collaborate with them. They are in the same shoes we are in.
Ad Age: Microsoft is in the midst of this enormously complex integration with Yahoo on search. What's your role in making that work?
Ms. Everson: My role is going to be working closely with [Microsoft corporate VP] Darren Huston and the rest of the Microsoft team with [Yahoo EVP] Hilary Schneider to make sure we hit a successful execution. That requires a number of deadlines being met, buttoning up the service aspect, and translating the accounts from Microsoft to Yahoo. It requires communicating to the sales organization so they fully understand the parameters of the deal, why it makes sense, and what they can do with marketers. Bing is an extremely important initiative for Microsoft. Making sure the back office is executed properly and making sure the field organization understands the parameters is important, and then there will be significant messaging to the marketers themselves.
Ad Age: Does it matter that right now you don't have a counterpart at Yahoo since they haven't appointed a head of sales?
Ms. Everson: I know the Yahoo team well. If they don't have a counterpart, I am certain Hilary Schneider will be leading that effort, and I look forward to working with her until a replacement is chosen.
Ad Age: Bing has gained a few share points, probably taken from Yahoo. How do you continue to grow it?
Ms. Everson: Microsoft's effort in research and development is important so the search algorithm is the best it can be. We think there is a tremendous amount of growth for Bing outside the U.S. We are very excited about what we're seeing from mobile and its relevance for local. We are looking at opportunities to utilize the data coming out of Bing to more effectively targeting campaigns that go multi-screen. It's a factor with display and with Xbox. When you start to take search behavior respecting the privacy the way Microsoft does, we can leverage beyond having it as part of a search revenue stream.
Ad Age: Will Microsoft look to renew the Viacom deal or do other global partnerships with media companies?
Ms. Everson: On the Viacom side, Microsoft is a very important strategic partner. Microsoft bought Viacom's remnant inventory, so that was a great strategic exchange between those two. Microsoft was a very important advertiser on the Viacom network. The companies sat down in a more strategic way because of this deal. This space is evolving so quickly. I absolutely see how content companies are going to be partners with tech companies in the future. But I think the definition of digital will be very different when this deal is up for renewal in three to five years' time. At that point, digital remnant could include TV inventory or a variety of different media.
Ad Age: Will there be a learning curve for you since you're coming from a traditional, old media?
Ms. Everson: I don't think of myself that way, partly because I was all digital before I went to MTV Networks. I ran Zagat's digital and mobile businesses. I ran Primedia Digital. I learned cable at MTV Networks. I don't think of MTV Networks as old media in the same way as a conglomerate focused on newspapers and TV stations.
Ad Age: Do you honestly think Microsoft can finally win on the web?
Ms. Everson: I wouldn't have joined if I didn't think that. I think it needs to be a contributor to both the top line and bottom line. Now they are in investment mode. There should be a path to profitability. Truth be told, making money on digital is not the easiest thing. But for the entire industry, I will be focused on doing everything we can to get them there. I think we are still in the nascent stage in this space.
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