Sources: Microsoft Risks Losing Influence With CMOs In Wake Of Advertising Job Cuts
Microsoft, which has reportedly laid off its entire global advertising sales team, could lose its influence with chief marketing officers that make business platform decisions, sources familiar with the matter told CRN Friday.
CRN reported Thursday that Microsoft has shut down its Global Agencies and Accounts team, which handles relationships with top media agencies and marketers; and Yarn, a creative team that promotes Microsoft platforms.
But Business Insider reported Friday that Microsoft has laid off its entire global advertising sales team, whose job is to sell ads on MSN, Bing, Xbox, Outlook, Skype and Windows 8.
[Related: Microsoft's Advertising Unit Shuts Down Global Agency, Creative Team In Latest Layoffs]
Microsoft couldn't be reached for comment on the Business Insider report Friday.
Sources said the advertising job cuts will make it more difficult for Microsoft to keep up with companies like Oracle and Salesforce.com, and Google, which are steadily building marketing portfolios delivered via the cloud.
The job of the CMO has morphed into one that necessitates making key technology decisions, and Microsoft risks losing its influence with these types of customers, sources said.
"For Microsoft to lose that muscle, connecting with the agencies and CMOs making technology buying decisions, is a big deal," one source told CRN, speaking on condition of anonymity because he's not authorized to discuss company matters.
"Oracle and Salesforce.com have been building marketing channels for years. They now have the tools and technology to go from the CRM system all the way out to touch the actual customer," said the source.
Microsoft accounts for between 2 percent and 3 percent of the global digital ad market, compared to 31 percent for Google and 8 percent for Facebook, according to eMarketer figures cited in an AdAge report earlier this month.
"Where are the relevant players in advertising today? Google and Facebook. Then you have Microsoft A&O [Advertising & Online], which has been losing talent and is seen in the space as a dead horse," said the source.
In Microsoft's fiscal 2015 first quarter, online advertising revenue grew 14 percent to $129 million compared to last year's quarter.
PUBLISHED OCT. 31, 2014