Microsoft Puts Deals in Email Display Ads

As I’ve written at MarketingLand, Microsoft is replacing conventional display ads in its Hotmail service with deals. The company believes the new deals ads will be more interesting and less “distracting” to Hotmail users. I would agree.

Google is starting to experiment with display ads in email but generally its text ads are fairly unobtrusive. Meanwhile Yahoo’s ads can be of dramatically variable quality.

On the one hand this is a bid to improve Hotmail and gain new usage for the Microsoft webmail product, which is the global leader with 350 million users. However it lags Yahoo and Gmail in the US. Recently Google reported that Gmail has 350 million active users globally, which would put it in a tie with Hotmail.

This development is also perhaps more interesting as a new form of deals distribution in display ads that will be targeted geographically and demographically.

The new Hotmail deal ads will roll out slowly in selected cities while Microsoft tests consumer response to the new ad units.

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