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Microsoft Hands Its Global Ad Business to Dentsu and IPG

  |  May 2, 2014   |  Comments

Microsoft is taking steps to consolidate its global ad business by choosing just two companies to work with.

In an effort to move forward with the concept of "One Microsoft," the tech giant has decided to hand its global ad and media business to just two holding companies - the Interpublic Group (IPG) and the Dentsu Aegis Group (Dentsu).

IPG shops, including McCann Worldgroup, The Martin Agency, and Erwin Penland, will take creative responsibilities for the company's traditional, direct, and digital ads. McCann will play a big role, as it will also manage the global distribution of Microsoft ads. Previously, WPP shops Wunderman and Possible, as well as Publicis' Razorfish and independent Omelet, among other agencies, supported these tasks.

Dentsu, on the other hand, will now manage Microsoft's media planning and buying, and search advertising. In 2011, Microsoft moved its North America media-buying account from IPG's UM to Publicis' Mediavest. And since then, the company's media business was mainly split between IPG's UM (overseas) and Mediavest (U.S.).

We reported in January of this year that Microsoft had started reviewing its agency contracts across the board, as part of its "One Microsoft" strategy, an initiative by the company's former chief executive (CEO) Steve Ballmer. The philosophy behind Ballmer's idea was to get all Microsoft's operations under one brand.

So early this year, four holding companies - IPG, Dentsu, Publicis, and WPP - each pitched Microsoft, and Dentsu and IPG emerged victorious.

This consolidation also comes hot on the heels of an executive shake-up in Microsoft's marketing department. Chris Capossela has succeeded the company's former executive vice president of marketing, Tami Reller, as the new chief marketing officer. Previously, Reller with the assistance of Mark Penn (the man behind Bill and Hillary Clinton's presidential campaigns), led the company's marketing strategy. This follows the earlier appointment in February this year of Microsoft's new chief executive, Satya Nadella.

It seems that under Capossela's leadership, Microsoft is moving forward with a more centralized marketing approach. Or in Baller's words, "one strategy, united together."

Image via Shutterstock.

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ABOUT THE AUTHOR

Yuyu Chen

Yuyu Chen is a junior reporter at ClickZ. Her work has appeared in Local East Village, New York Daily News and Brooklyn Chamber of Commerce website. Yuyu received her M.A. in Business and Economic Reporting from New York University in May, 2013.

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