Microsoft's Top Marketer Talks Kin, Kinect and New Ad Partners

On the Eve of a $1B Media Review, Mich Mathews Explains Her View of Changing World

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Mich Mathews
Mich Mathews

LOS ANGELES (AdAge.com) -- What is Microsoft, which has just thrown its $1 billion media account into review, looking for in an agency partner? Less tech support and more collaboration on big ideas for starters, said marketing chief Mich Mathews.

The same week Microsoft placed its choice account into review, Ms. Mathews raised eyebrows in the ad world with remarks made during a panel at the Consumer Electronics Show in Las Vegas. Speaking about the cost and time effectiveness of first-to-market campaigns like its ad on a Vanity Fair iPad app during last summer's World Cup, Ms. Mathews expressed concern over the long process through which it took her and her agency partners to execute.

"After that I looked at it and thought, 'Wow, it might be more powerful and cost-effective if we hire one guy to do this in India, and we would've just cranked that out," Ms. Mathews said. "'Should I be handling that in-house, or am I looking to completely change the structure of my service partners so we can be agile and do these things together?'"

Microsoft's media-agency review is described by Ms. Mathews as "standard operating procedure," and nothing personal against the incumbent, Interpublic Group of Cos.' Universal McCann, which is expected to defend. But the challenges she faces as she evaluates her future agency relationships are the ones faced by all marketers in 2011, she said.

"It seems like every single day there is something new, pioneering that you need to get in and figure out how you can take advantage of and determine, does it work for your brand or does it not work for your brand," she said. "It isn't the old, 'Hey, we're going to write a brief, come up with an idea and let's architect a campaign.' It's, 'OK, what is the offer on Groupon, or what are we going to do on Yelp, or what's the integration on Meebo?' Those types of things and the people I'm dialoguing with are a different set of people than my traditional, let's say, 'advertising partners.'"

That also means taking more resources in-house. Whether it's Microsoft's on-site production studio at the company's campus in Redmond, Wash., hiring more software developers and engineers to develop tech-based campaigns or testing certain ads' effectiveness on Microsoft media properties such as MSN or Microsoft.com, Ms. Mathews has more outlets than ever to test tactics with little or no outside help.

"Increasingly in marketing, the CIO [chief information officer] is your best friend, because we all need infrastructure tools, we need big-brain analytics people who are going to help us do models and targeting and so on," she said. "In some cases I'm extremely fortunate because I've got folks at MSN who we're family with, where I get to say, 'Hey, can we try this overnight?' and maybe you do some testing, you see what works, you see what doesn't, and you get that data immediately."

That micro-strategy shift has led to what Ms. Mathews credits with Microsoft's biggest launches of 2010 via social media. The Xbox Kinect sensors, for example, were promoted via a world tour in over 20 countries four months prior to its global launch. As part of the promotion, fans could upload video of themselves and their Kinect experience to a micro-site, Kinect.me. The approach helped Kinect acquire more than 4 million new Facebook fans in a six-month period, and Microsoft sold more than 8 million Kinect sensors in the first 60 days of launch alone.

The Windows 7 phone also turned to Facebook to host live phone demos, generating 1.6 million demo videos and over 600,000 "likes." More than 1.5 million Windows 7 Phones were sold within the product's first six weeks.

Ms. Mathews also credits social media for the learnings from the company's biggest flop last year. The Kin phone, which was pulled after six weeks amid sales of a reported 500 devices, was first marketed to its young-adult target almost exclusively on Facebook. The phone picked up 105,000 fans and helped bring 439,000 unique visitors to Kin.com before the launch -- strong early numbers for a phone launched without any TV or traditional media at the time. But high pricing and poor marketplace timing ultimately killed the Kin, as Ms. Mathews sees it.

"I say this to my marketers, all of them, that it's awesome that you build community, but now you have to nurture and keep that community, and keep it entertained, and make sure that you're talking to that community in the way that it wants to be talked to. Otherwise it will just drift away."

As for agencies looking to pitch Microsoft when its media review kicks off in the coming weeks? Be open to sharing your ideas -- and budgets -- with a lot of parties. Ms. Mathews noted there are no loyalties at play; she intends to continue with Microsoft's strategy of working with multiple holding companies. Currently, MDC Partners' CP&B handles brand work for Windows PC and Windows Computer; WPP's JWT handles work for Bing while Wunderman has various direct marketing duties; Interpublic's Agency 215 is the lead on XBox and sibling Deutsch picked up the Cloud Power business last summer.

"My philosophy is that creative and media should work side-by-side from the outset. This was a big focus of mine last year. The results have been tremendous," she said.

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