SINGAPORE - It may have missed the search boat and the subsequent wave that propelled competitor Google to the top of the adspend mountain, but Microsoft and its Bing Ads division are confident that they're making all the right moves to secure a place in the next inevitable wave.
At least that’s the message Steve Sirich, general manager of Bing Ads Marketing at Microsoft, had to share during a recent visit to Singapore.
“Bing is probably a little bigger than you think,” he told Campaign Asia-Pacific. Actually, It might be surprising to many in Asia that Bing is not only alive and well, but also profitable.
According to Comscore data as of September, Bing’s US market share is 32.5 percent, and Microsoft reported during an earnings call in October that “search advertising revenue excluding traffic acquisition costs grew 29 percent in constant currency with US market share benefiting from Windows 10 usage.”
CEO Satya Nadella remarked on the earnings call that Microsoft saw roughly US$1 billion in search ad revenue for the quarter.
Bing beyond search
The big-picture vision for Bing is that of an “intelligence fabric” that is woven into Windows 10, Xbox, Cortana and other products.
It is a growth strategy that the company sees for Bing and its cache of more than 30 billion entities of information, an “information corpus” second only to Google.
Beyond the Microsoft ecosystem, Bing is also the search engine for Apple’s Siri and Spotlight search, as well as Amazon's assistant devices. And more partnerships are expected. Integrations with LinkedIn after Microsoft's acquisition of the professional networking platform closes next year are also in the pipeline.
Initiatives the company is working on include a testing and optimisation product called Decision Service, which is touted to have use cases for content, ads, product recommendations, and pricing optimisation. From an ads standpoint, Decision Service could be layered on top of an ad server or eventually integrate directly with Bing Ads.
The company is also looking at the concept of CAAP (conversation as a platform)—making bots that understand natural language the next big way to use devices. Under this vision, bots would become the monetisation driver for developers, not apps.
“We all know search well, but it’s also at the tip of the iceberg in terms of interface and how we use it,” said Sirich. “It’s not very intuitive, not very human and there is a natural user interface around search that’s yet to be fully tapped with voice and gestures. This would unlock new search scenarios from cars to mobile.”
There is also of course, the potential in holographic computing, courtesy of Microsoft's HoloLens; the company promises that consumer applications for the augmented-reality device are not far off.
The future of Bing, with its pervasiveness throughout the Microsoft ecosystem and its partner deals, certainly sounds enticing. However, direct practical applications for advertisers won’t be available in the immediate future.
Currently, and more directly relevant, are initiatives such as a dynamic native ads pilot, which is now running with a small set of advertisers and publishers and is slated to go live in early 2017.
The company intends to build a curated network of sites around key commercial verticals such as automotive and financial services, an “intent network” to distinguish itself from standard display networks that include the Google Display Network.
The company is also working on increasing its presence on mobile, which can’t be done via first-party platforms alone.
“We think of it first in terms of partnerships and about Bing in those kinds of partnerships for mobile supply opportunities,” said Sirich. “We will continue to build experiences like the Cortana apps and Bing apps, but the first priority is on building the third-party supply chain and partnerships.”
Searching for a place in Asia
Building up Bing's partner ecosystem takes on heightened emphasis in Asia, where mobile devices dominate consumer usage patterns and remain a weak area for the company.
Earlier this month, the company announced the rollout of its ads partner programme in Asia, aimed at fostering collaboration with agencies, technology partners and SMB partners. The company is also working to forge partnerships with the Microsoft partner network and other networks throughout the company to gain leads for Bing Ads partners.
Sirich, a 20-year veteran of Microsoft, did not hesitate to acknowledge where the tech giant currently stands on the totem pole.
“We approach it with a certain amount of humility," he said. "We know we're the underdog and not the default experience. And we have to be very respectful that we're asking for a share of time from advertisers and agencies.”
However the company feels that its share and unique audience enable it to talk to advertisers and pass the ‘straight face’ test.
Sirich said the message to advertisers is one of choice and ease of use, with tools such as a Google import tool to offer a frictionless way to get on-board with Bing. He is also mindful of the need to remain competitive while offering differentiation.
“We know that choice is healthy and that we’re not quite there yet in some of the markets,” he said. “When we first launched Bing in 2009, we had no market share, and for the last 88 straight months, we’ve taken share from Google in the US. So there is hope, optimism and progress."
Another crucial change is the renegotiated search deal between Microsoft and Yahoo last year, which resulted in ad sales and account management of the Bing Ads Network transitioning back to Microsoft.
It is a move that has made all the difference with clients, according to Sirich, enabling the company to offer better support and attention.
According to Microsoft, Australia is one of Bing’s fastest-growing markets in Asia, with 14.2 percent PC search market share. In Southeast Asia, Singapore shines, with the Bing Network PC market share having grown in the past year to 8.5 percent.
The company shared that it has also seen growth in unique searches, with 2 million of them in Singapore equating to around one in three individuals in the market. India, Vietnam, Malaysia and Indonesia are also between 5 and 10 percent and growing.
“This growth makes the region a clear priority for investment into the consumer experience and business offering to marketers,” said Sirich.
In addition, the company said it is witnessing a unique trend for cross-border investments with advertisers in India and China targeting developed markets such as the US and UK, where double-digit growth is apparent—with market share at 31.9 percent and 23.5 percent, respectively.
Asked about whether there are plans to aggressively grow its user base, Sirich said that the focus is on providing a unique destination experience for users, with rich content via continued improvements to the search platform.
“There are no specific plans for Asia right now in terms of marketing initiatives to drive awareness,” he added. “We’re going to continue to build via trial with our first-party ecosystem and third-party partnerships. We’ve found that through those means, we’ve been quite successful in building audience, and the lifetime value is higher versus paid-media campaigns.”
If anything, the Bing team appears to be relishing its position as the challenger brand in the market, and surprising potential clients about what it can offer; Sirich maintains that surprise is the most common reaction he gets during meetings.
“They tell me that Bing is a lot more relevant than they thought, that we have more supply than they were aware of, and that the ROIs in many cases are better than Google’s,” he claimed. “And also the realisation that it is so strategic to Microsoft in the long-term.”
Sirich added that the team gets a lot of encouragement, with a sense that the industry at large is rooting for its success.
“We are no longer the Goliath on the block," he said. "We enjoyed that at one period with Windows, but recognise with Bing that we are the challenger experience, and we like it. People really value choice and recognise what competition does for innovation.”
So, while the company plods on with its plans, there is one question Sirich would like to not hear ever again in a client meeting: “So when are you guys selling Bing?”
For an executive who was around when the company launched MSN Search in 1998, the query is starting to get a little old.
“This is third chapter in Microsoft’s search journey, and also the chapter that proves that we are invested in search for the long term,” he said.