Microsoft’s head of search David Pann on how Bing is taking on Google

David PannDavid Pann is the general manager of Microsoft’s global search business, the Yahoo Bing Network.

In this interview with Mumbrella Asia editor Robin Hicks Pann talks about why Bing is a better deal than Google for advertisers, how to win customers in a market dominated by one player, and how the future of search will be won.

You’ve been on global ‘listen and learn tour’ of 35 countries to meet with customers. What are the pain points your customers have with Bing?

We’ve been doing this for several years and we’ve been in a continuous development cycle. We’re launching a new product on a weekly basis somewhere across the world. Over the last 12 months, we have invested in simplifying our offering. Online advertising is getting more complex. Agencies and advertisers have been asking us to make Bing easier to use, more intuitive, faster, and to make everything scalable. We’ve invested heavily in the user interface and the overall performance of the platform.

We’ve also improved how customers can use data in a way that is actionable. We want brands to know what’s impacting their advertising positively and negatively, and to be able to make adjustments quickly. We want advertisers to get great ROI, and we think the ROI that Bing delivers is outperforming the competition.

So what’s the secret to winning over advertisers and users for Bing?

We have an audience that is not available on Google, who spend more time online, according to third party studies. In terms of cost per acquisition, average transaction size and return on dollar spent, we’re ahead of our competitors, which is why we’re seeing advertisers move more dollars to our marketplace.

What has also helped us to grow is eliminating the friction for advertisers to run the ads they put on Google ads on Bing. And we’re working on making campaign reporting similar to Google’s, so it’s easier for advertisers to migrate across.

So you’re working on how to be different to Google, but also how not to be too dissimilar?

It’s the innovators dilemma. Advertisers say that you need to be similar, but also to innovate. If you were to launch a new laptop, you wouldn’t do so with anything other than a ‘qwerty’ keyboard. When you innovate on the user interface for a campaign management tool, you won’t necessarily win people over. You need to bring genuinely new and better capabilities to the marketplace.

Like what, for instance?

The One Microsoft strategy means that Bing is not just a nice to have, it’s a must have. When we introduced the new version of Windows this year, we integrated Bing into the search capability. Windows 8 will evolve into Windows 10, and Bing is an integral part of that. You want to develop a relevant experience, and that comes from a lot of experimentation in working out how to bring the two systems together.

Another example is Cortana, Microsoft’s digital assistant, on Windows phones. Cortana, which is built into the Windows phone operating system, is powered by Bing. Cortana knows a lot about users – what they’re doing, where they are and, increasingly, where they need to be. It can help people anticipate and avoid problems. Over time, there will be ways for marketers to get involved. But we’re not focused on that now. We want to get in front of users in new ways.

Watch a Microsoft ad that pits Cortana against Apple’s Siri.

What makes Bing better than Google?

We ran tests of people using Bing side by side with users of Google, and most thought Bing was better. But we are up against the brand dominance of Google. It’s a phenomenal company, that is without question. But we have to focus on how we can be better, and one of those areas is our predictive capability. In the US, people are using our predictive engine to predict winners in sporting events. We did predictions of the mid-term elections with a high degree of success. We think that we can help people get more out of the internet. The thing none of us have enough of is time. We can help companies and consumers be more productive with the time they have.

So, what’s next for Bing?

We’re putting a lot of investment into the new ways people can interact with the engine. It’s not about just a search box, it’s now about voice too – which is where Skype comes in. How much easier would it be for the global community to work together if language wasn’t a barrier? We’re thinking about how to use the power of knowledge to help the world be more productive and make lives better. For example with Cortana, we want it to be available wherever you are, across all devices.

What about new services for advertisers?

Search is moving from keyword to audience. Advertisers want the ability to buy an audience, and they want this kind of audience across your user base and they want to be able to get messages to them in unique ways.

Take online travel companies. They will tell you that when consumers book a vacation, it takes them 30-40 searches before they get what they want. At the point that they get where they want to be, is particularly valuable to a marketer. They want to be able to communicate with all those people who’ve decided to go on holiday to Hawaii, with a specialised offer. We’re already starting to see that the richness of the experience on the results page is changing. It’s now more commercially orientated, with more imagery and more video.

Do you think advertisers and users want more a complicated landing page after a search? Search is a lean-forward experience where people don’t want the frills they get with an entertainment experience they get online.

It’s all about context. Search is the most powerful intent mechanism on the internet, but the balance between richness and vanilla for users is very delicate. We think there is a great experience that can help you be more productive with a richer offering. If you understand the consumer intent and understand what audience marketers are looking for, you can build the right experience.

So what’s the state of play in Asia, and what are your plans for the region?

We’ve got between north of the high 20s to the mid 30s in market share in Hong Kong and Taiwan, and we’re looking to grow that. We want to generate good quality clicks for advertisers, and we have a development centre in Beijing that helps us push that ambition forward. The centre is focused on developing algorithms and special ad formats for Asian markets. Once you can show growth in click share, you can start to acquire more share of wallet. In Hong Kong and Taiwan, our share of wallet is much larger than our query share, which goes back to ROI and the sort of service that Yahoo and Microsoft provide. Service is a big differentiator in this space, particularly in Asia.

How aggressive are your growth targets for Bing, and do you see yourself as a challenger brand?

We have growth targets, on the consumer side and the publisher revenue side, but we don’t share them. We’re a challenger brand even in the desktop market. We’re the underdog, we’re not the dominant player. And we are operating like a challenger – nimble and fast. We’re going where the consumers are, which is why we’re bringing Microsoft Office to Android.

Isn’t it tough to motivate teams, given the enormity of Google’s market lead?

We don’t break out revenues for the business overall, but when the Bing business is mentioned in they quarterly earnings it matters. Even in markets where we have a small query share, the growth has been phenomenal. Advertisers are seeing its value. In Australia, for example, we didn’t know how strong Bing would prove to be when we launched in the summer of 2013. We can’t get caught up with the reality that we have three per cent query share in some markets – you get lost in the forest for the trees.

We are providing advertisers with global reach. We see lot of advertisers in Asia Pacific looking for cross border opportunities. For example with Australia, there are a lot of advertisers in the UK that want to reach out to Australian audiences.

Can a competitor like Google, with such overwhelming market dominance in some countries that naturally increases with the network effect, ever be caught?

When we launched Bing more than five years ago, we had seven per cent query share in the US. Now, it’s north of 19 per cent. That progress came from somewhere. I don’t have a crystal ball, but Microsoft is committed to this business and it’s growing. We think we could catch up with Google eventually, but time will tell. You should always focus on competition, but only so much.

Robin Hicks

See the Mumbrella Asia website here.


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