Bing marketing firings unveil tale of bling and private agency money arrangements

More details are dribbling out about the high profile firings of Microsoft Bing marketing executives Eric Hadley and Sean Carver.

One issue was a first class flight taken by Carver and authorised by Hadley, who shouldn’t have. Hardly a hanging offence surely.

Another relates to items the two ordered for their ‘Bing Bar’ in Park City, Utah, a corporate hospitality wheeze to leverage Bing’s relationship with Robert Redford’s Sundance indie film festival. Showbiz has always been dangerous for star-struck clients.

The third, rather intriguingly, is an alleged $1m plus fee paid to Co Collective, the new agency (or something like an agency) started by JWT refugees Ty Montague and Rosemary Ryan in 2010. Montague and Ryan had worked on the launch of Bing with Hadley and Carver in 2010.

The trouble was (and is) that Co Collective isn’t on Bing’s official agency roster and the fee was allegedly paid (or laundered, is the implication) through Publicis Groupe’s Razorfish, which is. So it’s not just Hadley, Carver, Montague and Ryan who are in trouble here but Razorfish as well.

Hadley and Carver are given much credit in the business for their manful efforts to create some excitement around Bing, Microsoft’s latest effort to challenge Google in the search market. The Sundance initiative (performers at the bar included Neil Young) was a fairly reasonable thing to do, in principle at least. Although clients going native in the entertainment world can be embarrassing, as our picture lifted from George Parker’s Adscam/The Horror! aptly demonstrates. George has his inimitable take on the affair here.

As for Co Collective, this really is rather odd (and expensive, by the sounds of it). And what on earth did Razorfish think it was doing? Publicis Groupe boss Maurice Levy has enough problems on his plate with murky media doings in China.

Microsoft’s’s Bing threw itself into the news this past week when it publicly fired two top consumer-marketing executives, Eric Hadley and Sean Carver, general manager and director, respectively, for marketing communications. The cause, according to Microsoft: violating company policies related to mismanagement of company assets and vendor procurement.

An internal investigation turned up a list of violations, which Ad Age has learned included problems with line items and dates on purchase orders related to the three-story Bing Bar in Park City, Utah — Microsoft’s’s celeb hangout during the Sundance Film Festival. This year, the space hosted performances from Drake and Jason Mraz, appearances by Paul Simon and Neil Young, catered food and an open bar.

Eric Hadley
Another incident cited in the list of violations involved the Bing marketing team paying Co Collective, which was not a Microsoft-approved vendor, a $1-million-plus fee through longtime agency Razorfish. The Bing team had worked with Co founders Rosemarie Ryan and Ty Montague, when they were at JWT to launch Bing in 2009 and, as Ad Age reported, were eager to tap their new venture to refresh the brand.
A third violation involved a first-class flight Mr. Carver took from New York to Seattle; Mr. Carver was not supposed to fly first class but Mr. Hadley approved the flight despite not having the authority to do so.

Bing has become known for pushing the envelope in marketing to build a brand in a search market synonymous with Google. But after some modest growth in market share, Microsoft has now cleared away the public faces of brand Bing in a public way. At Bing’s outset, Microsoft signaled that no price was too high to win at search, but with procurement violations pushing out the architects of the work that’s gotten Bing noticed, that may no longer be the case.

After announcing the departures unprompted, Microsoft chose not to comment when Ad Age followed up with additional questions about the violations. Messrs. Hadley and Carver declined to comment.

Messrs. Hadley and Carver were the bold-face names associated with some of Microsoft’s most high-profile marketing, including celebrity tie-ups with Jay-Z and LeBron James. And they weren’t adept only at getting buzz for Bing. The pair had produced a short film with Creative Artists Agency about Dr. Richard J. Bing, who had written to Microsoft about his 100th birthday. The film made its debut at Sundance in 2010, and Mr. Carver later enlisted Seattle-based boutique Neverstop to create a Wikipedia page for the film — “for personal reasons to get Hadley and [myself] PR,” wrote Mr. Carver in an email obtained by Ad Age. Neverstop also produced the lavish Bing Bar at Sundance.

Mr. Hadley, in particular, had drawn a lot of attention for his work for Bing, much of which has been highly awarded. For Bing’s role in Jay-Z’s book launch at an exclusive hotel in Miami’s South Beach, Mr. Hadley was called “Microsoft’s Mr. Fun” and Bill Gates’ opposite by the Daily Beast in late 2010.

Swagger or not, Mr. Hadley has produced work held up as the gold standard in marketing. In the past 12 months he was honored as an Ad Age Media Maven and inducted into the AAF’s Hall of Achievement. He has been quick to back up high-profile campaigns with data, especially since his former company was largely driven by it. Of the Jay-Z deal, he has pointed out that young people and African-Americans are the most active demographics in search; 18- to 24-year-olds consume 61% more search pages than average and African-Americans 29% more.

People wonder whether the strategy that began under chief marketer Yusuf Mehdi, who left the online-services division for the entertainment group, including Xbox, in November, will continue. He had encouraged the Bing team to do bold marketing with the understanding that it would take more than just display, search and TV ads to win market share in such a competitive space.

But that kind of marketing is, of course, harder to measure. Bing Bar, for example, was an expensive endeavor, though it was meant to generate entertainment-oriented content that could be used throughout the year to push concepts such as Bing Music, which ties in Microsoft’s Zune music player, according to someone familiar with Bing’s marketing strategy.

“Measuring cultural impact is a very tough thing to do and, unfortunately, that’s the part that gets thrown out when talking about ROI,” said Steve Stoute, founder of agency Translation and a friend of Mr. Hadley.

The departures have raised questions about whether Bing will continue to push that envelope.

“I think the [Bing] team understands, and heard loud and clear from leadership that there’s lots of work to do and that change is omnipresent in any business,” said Adam Sohn, Bing’s general manager for communications and influencer marketing.

Bing marketing will now be led by Microsoft-lifer Mike Nichols. He joined Microsoft in 1996 in product marketing, where he’s worked with engineers on product features for Office, Internet Explorer, MSN and now Bing. While h was a part of the online-services department even before Bing was invented, he was not hands-on with partners launching the brand or with more recent ad efforts.

Under Mr. Nichols, Bing will continue to support the “Bing Is for Doing” campaign through early summer, Mr. Sohn said. It will also continue to work with its main agencies, Razorfish and Starcom. Microsoft spent $118 million in U.S. measured media for just the Bing brand in 2010, according to Ad Age DataCenter.

“You have to manage change in any business,” Mr. Sohn said. “I don’t see the changes in the team leading to any real strategy shifts.”

He says there are no plans yet to ditch the innovative, celebrity-laden stuff that’s won big on the ad-awards circuit. It’s not yet been decided if Bing will be returning to Sundance in 2013. “We’ll continue with the harder working, more traditional marketing to show people the product,” Mr. Sohn said.

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About Stephen Foster

Stephen is a former editor of Marketing Week and London Evening Standard advertising columnist. He wrote City Republic for Brand Republic and is a partner in communications consultancy The Editorial Partnership.