The Digital Signage Insider

Advertising Age published a story this week about Microsoft's next big foray into the advertising world. Microsoft has owned the popular Atlas sales and planning tool for a while, and they acquired Razorfish to get some real-world agency experience (see our recent interview with Razorfish's Patrick Moorhead). But Microsoft continues to play second fiddle to Google in online advertising. Away from the Internet, the firm's only successful foray into the agency world has been with their standard tool set -- stuff like Office and Exchange. But the 800-lb gorilla of the software industry clearly has their sights set on a successful penetration of the advertising world, both online and off. How do they plan to do it? By doing what they do best, of course. As the firm describes it, they're out to make an Office Suite for Advertising, also known as the "Media Operations Management System".

What would 'Office for Advertising' look like?

For better or for worse (and from my sanity's perspective, for better), I've never worked at an advertising or media planning agency. However, I've worked with plenty of these companies over the years. Looking back at my experiences, I have to imagine that trying to make a single tool that any agency could use interchangeably is going to turn into a giant exercise in futility. The diversity of needs is the real killer here. Think about it: one of the reasons that Microsoft's Word (and all word processors, for that matter) were so successful was because they had a very simple precedent to overturn. Until then (barring expensive typesetting machines), if someone wanted to put type on paper, they used a typewriter. Margins, typefaces and other formatting options were difficult if not impossible to change. Undo involved copious amounts of white out.

There was a clear need for improvement. Luckily for Microsoft and their early competitors, the entire user base was stuck with essentially the same tools, and was thus faced with essentially the same problems. As the publishers of programs like WordPerfect, Ami Pro, and Word would find, simple functionality like "load," "save" and "undo" made the act of typing a document so much better that virtually everyone understood the value of their systems. Over time, as the improvements to these programs became less spectacular and often more esoteric, Microsoft was able to use their monopoly in the operating system market to make themselves the de-facto purveyor of office software too. By then, the notion of using a typewriter to type a document was cute and antiquated -- the kind of thing you might remember from early in your career, or something that your parents did. But it certainly wasn't something you'd do today.

However, the enterprise software space isn't built on common ground. Ask any agency how they bill, or any planner how they allocate funding, and you're going to get a different answer. That's one of the reasons why the ad business software market has room for both boutique companies as well as behemoths like Oracle and SAP. Maybe Microsoft can make a package that will address the needs of 25-30% of the market, which still represents billions of dollars in billings. But by the time each company gets the software set up to meet their unique needs, it'll probably be just as complex as whatever they're currently working with. Cheaper? Maybe. But more efficient? I doubt it. And believe it or not, agencies have the same drive towards efficiency as any other business, so sacrificing productivity to save a few thousand on software will probably not be viable in the long run. Simply put, unless Microsoft can make something so phenomenally awesome that it makes existing companies tailor their business plans to fit the software, their promise of a "Holy Grail for marketers" is hard to believe.

What's the most likely scenario? Elegant, web-based connectors.

Well, if Microsoft says they're making an Office for Advertisers, they're probably going to follow through on that promise. What form the product will take and how functional it will be remains to be seen. In the past, they have needed a good two or three versions before a new product became truly useful. Still, even in a wildly optimistic scenario, it seems unlikely that the firm will be able to move a significant number of clients away from their existing systems. Depending on how they position it, they might have more success on the low-end (where price can play a more powerful role), or maybe they'll start by targeting a specific vertical market. But a panacea for the marketing industry it will not be.

If I had to bet, the next wave of innovation in the ad planning, booking and billing space won't come from a new, monolithic program. Instead, it will emerge from the small connectors that the different vendors will start supplying to allow web-style mashups inside companies, instead of only on the web. These connectors will probably be available for free, and might even be provided in an open source format. IBM, Oracle and SAP already offer some web-based connectors for pulling data in and out of their complex back-office systems, but these are cumbersome and difficult for all but the most experienced engineers to use. The next wave of software connectors will be easier, leveraging accepted web-based metaphors and paradigms. They'll give software developers and even savvy businesspeople the ability to move data from system to system, into and out of documents and spreadsheets, and even between different organizations. We have a lot of data at our fingertips today. But even savvy marketing firms often find that too few people have access to it (because it's hard to get to). And even once you have the data, it's too hard to manipulate in such a way that it actually provides insights.

Luckily, these are the types of problems we can solve with a "wisdom-of-the-crowds" approach, where having lots of people looking at them from different angles can yield significant innovations very quickly. Consequently, I believe that long before Microsoft is able to "solve" the problem of back-office management for the marketing world, we'll see a new level of interoperability between systems and agencies. This will be enabled not by some new, big, enterprise package, but rather by a bunch of little scripts and applications strung together quickly and cheaply -- using old or existing data to solve new problems in new ways.

Is there a software package, feature or service that would make your business life a lot easier? What would it need to do? Leave a comment and let us know!