Microsoft Advertising: The Channel Most Performance Teams Underfund
Microsoft Advertising is a paid search platform that gives advertisers access to the Bing, Yahoo, and DuckDuckGo networks, reaching an audience that Google does not fully cover. For most performance teams, it sits somewhere between an afterthought and a secondary channel, which is exactly why it tends to deliver better returns than the primary one.
The case for Microsoft Advertising is not that it replaces Google. It is that most advertisers have pushed Google CPCs to a point where incremental spend produces diminishing returns, and Microsoft offers a structurally cheaper route to the same conversion intent, on a platform where competition is genuinely lower.
Key Takeaways
- Microsoft Advertising typically delivers lower CPCs than Google across comparable keyword sets, not because the traffic is worse, but because fewer advertisers are bidding aggressively.
- The Microsoft audience skews older, more affluent, and more desktop-heavy, which makes it particularly strong for B2B, financial services, and considered consumer purchases.
- Campaign import from Google Ads removes most of the setup friction, but importing without reviewing match types and bid strategies is a common mistake that inflates wasted spend.
- LinkedIn Profile Targeting inside Microsoft Advertising is a capability that has no equivalent in Google, and it makes the platform genuinely differentiated for B2B advertisers.
- Treating Microsoft Advertising as a set-and-forget import of Google campaigns is the single biggest reason teams underperform on the platform.
In This Article
- Why Microsoft Advertising Gets Underestimated
- What the Platform Actually Offers
- How to Set Up Microsoft Advertising Without Wasting the First Month
- Audience Strategy on Microsoft Advertising
- Bidding and Budget Allocation
- Measurement and Attribution
- Common Mistakes That Cost Real Money
- When Microsoft Advertising Makes the Most Sense
I have run performance programmes across more than 30 industries, and the pattern is consistent: Microsoft Advertising gets funded at around 10 to 15 percent of the Google budget, managed by whoever has spare capacity, and reviewed quarterly if it is reviewed at all. Then someone pulls the data properly and finds the cost per acquisition is 20 to 40 percent lower than Google, and suddenly there is a conversation about why it was not prioritised earlier. The answer is usually inertia, not strategy.
Why Microsoft Advertising Gets Underestimated
The platform has a perception problem. Bing carries cultural baggage as the search engine people use when they have not changed their browser defaults, and that perception bleeds into how performance teams think about the audience. But perception and data are different things.
Microsoft’s own data consistently shows that a meaningful portion of its search volume comes from users who do not use Google as their primary search engine. The demographic skew is real: older, higher household income, more likely to be on desktop. For a B2C retailer targeting 18 to 24 year olds on mobile, that matters. For a financial services brand, a B2B software company, or a premium consumer brand, it is often a better fit than the Google audience mix.
The desktop-heavy nature of the traffic is also worth paying attention to. Desktop sessions typically convert at higher rates than mobile for anything involving a form, a quote request, or a considered purchase decision. When I was running paid media for a financial services client, desktop conversion rates were running at roughly double mobile across all channels. Microsoft’s audience composition meant we were naturally indexed toward higher-converting sessions without any additional optimisation.
If you are thinking carefully about where conversion problems actually live in your paid search programme, the CRO and Testing hub covers the full picture, from audience quality through to landing page performance and post-click behaviour.
What the Platform Actually Offers
Microsoft Advertising covers more than search. The product set has expanded considerably, and understanding what is available changes how you should think about the platform’s role in a media plan.
Search and Shopping
The core is still text ads and product listing ads across Bing, Yahoo, AOL, and the Microsoft Audience Network. Shopping campaigns work similarly to Google Shopping, with a product feed driving dynamic ad generation. For e-commerce advertisers, this is usually where the most direct value sits.
Microsoft Audience Network
The Audience Network extends reach into native placements across MSN, Outlook, and Microsoft Edge. These are not search placements, they are intent-informed display placements, and they behave differently. Conversion rates are lower, CPMs are lower, and the use case is more aligned with upper-funnel activity than direct response. Treating Audience Network placements the same as search campaigns is a mistake I have seen repeatedly, and it tends to inflate cost per conversion figures in a way that makes the whole account look worse than it is.
LinkedIn Profile Targeting
This is the capability that genuinely differentiates Microsoft Advertising for B2B. Because Microsoft owns LinkedIn, advertisers can layer LinkedIn profile data, including job function, industry, company size, and seniority, onto search campaigns. You are not buying LinkedIn placements. You are using LinkedIn data to refine who sees your search ads on Bing.
The practical application is straightforward: if you are bidding on a generic keyword like “project management software” and you want to prioritise impressions for IT directors at companies with more than 500 employees, you can do that. Google cannot offer that. LinkedIn Ads can, but at a substantially higher cost per click. Microsoft Advertising gives you a middle path: search intent plus professional audience data, at search CPCs.
Performance Max and Smart Campaigns
Microsoft has followed Google’s lead with automated campaign types. Performance Max campaigns use machine learning to optimise across placements and formats. The same caveats apply here as they do on Google: automated campaigns need clean conversion data, sufficient volume to learn from, and clear business constraints built in. Without those inputs, the automation optimises toward the wrong signals. I have seen Performance Max campaigns on both platforms optimise beautifully toward soft conversion events that had no relationship to actual revenue.
How to Set Up Microsoft Advertising Without Wasting the First Month
The campaign import function is the obvious starting point. You can pull campaigns directly from Google Ads, and for most advertisers, that is the right first step. But import is not a strategy. It is a starting point that needs immediate adjustment.
What to Fix Immediately After Import
Match types behave slightly differently between platforms, and broad match on Microsoft can pull in traffic that you would not expect. Review your search term reports within the first two weeks and build out a negative keyword list before you have spent your way through the learning period.
Bid strategies need reviewing. Importing a Target CPA or Target ROAS strategy from Google assumes that Microsoft’s algorithm has the same volume of conversion data to work from. It almost never does at the start. Beginning with manual CPC or enhanced CPC while the account builds conversion history is usually the more defensible approach. Automated bidding without data is not optimisation, it is guessing with extra steps.
Ad extensions, now called assets in both platforms, do not always import cleanly. Check that sitelinks, callouts, and structured snippets have transferred correctly and are active. Missing extensions reduce quality score and increase CPCs, which defeats the purpose of being on a lower-competition platform.
Conversion Tracking
This is non-negotiable. Microsoft Advertising has its own UET (Universal Event Tracking) tag, and it needs to be implemented separately from Google’s conversion tracking. Relying on Google Import to carry conversion data across is not reliable, and it means you are flying without instruments on a platform where the data is already thinner than Google.
The UET tag also enables remarketing audiences within Microsoft Advertising, which opens up audience-based bid adjustments and RLSA-equivalent functionality. Without it, you are running blind on audience segmentation.
For a sharper view of what conversion tracking should actually be measuring, the core principles of conversion rate optimisation from Search Engine Land are worth reading alongside your platform setup.
Audience Strategy on Microsoft Advertising
The audience capabilities on Microsoft Advertising are underused, partly because the platform’s UI has historically been less intuitive than Google’s, and partly because most teams do not get past the basic import-and-run approach.
In-Market Audiences
Microsoft maintains its own in-market audience segments based on Bing search behaviour, browsing data from Edge, and purchase signals from Microsoft properties. These segments can be applied as bid modifiers or as targeting layers on search campaigns. The quality varies by category, but for financial services, automotive, travel, and technology, the in-market segments are reasonably well-defined.
Customer Match and Remarketing
Customer match allows you to upload first-party data, email lists, CRM segments, and use them to adjust bids or create similar audiences. Given the increasing restrictions on third-party data, first-party audience activation is becoming more important on every platform. Microsoft’s customer match functionality is comparable to Google’s, and it should be part of any serious audience strategy on the platform.
Remarketing lists work through the UET tag and can be segmented by page visited, time on site, pages per session, and custom events. The same logic that applies to Google RLSA applies here: bid up on high-intent visitors, bid down or exclude visitors who have already converted, and use audience data to inform ad copy as well as bids.
LinkedIn Profile Targeting in Practice
When I first started using LinkedIn Profile Targeting on Microsoft Advertising for a B2B client in the professional services space, the expectation was that it would narrow reach too aggressively and drive up CPCs. The opposite happened. By targeting senior decision-makers in specific industries, we reduced wasted spend on informational queries from students and junior employees, which improved conversion rates and brought average CPC down despite the audience restriction. The volume was lower, but the quality was substantially higher, and the cost per qualified lead fell by around a third over the first quarter.
That is the kind of outcome that gets buried when Microsoft Advertising is treated as a Google clone rather than a platform with distinct capabilities. The Moz CRO playbook makes a similar point about audience quality being a conversion lever that most teams ignore in favour of on-page optimisation.
Bidding and Budget Allocation
The budget question on Microsoft Advertising is usually framed wrong. Teams ask “how much should we spend on Microsoft?” when the right question is “what is our marginal cost per acquisition on Google, and at what point does Microsoft become the more efficient incremental channel?”
If your Google campaigns are running at a target CPA of £80 and you are consistently hitting that target, the question is whether additional Google spend above your current level will deliver at £80 or whether it will start to cost £95, £110, £130 as you push into less competitive dayparts, broader match types, and lower-quality placements. If the marginal Google CPA is rising, Microsoft becomes the better option for incremental volume, even if the absolute volume is lower.
This is a straightforward portfolio optimisation argument, but it requires teams to think about marginal returns rather than average returns, and most reporting setups do not make that easy to see. Average CPA across a Google account can look healthy while the marginal CPA on incremental spend is well above target.
Bid Adjustments Worth Using
Device bid adjustments matter more on Microsoft than on Google because the desktop skew is so pronounced. In most accounts, it makes sense to bid up on desktop and reduce bids on mobile, particularly if your landing experience is not optimised for mobile conversion. The Unbounce research on site optimisation priorities consistently points to mobile experience as a conversion bottleneck, and if your site has that problem, reducing mobile bid exposure on Microsoft is a sensible short-term mitigation.
Location bid adjustments should be reviewed separately from Google. The geographic distribution of Microsoft’s audience is not identical to Google’s, and performance by region can differ meaningfully. Running the same geographic bid adjustments across both platforms without checking the underlying data is lazy and usually costly.
Measurement and Attribution
Attribution is a problem on every paid channel, and Microsoft Advertising is no exception. The platform defaults to last-click attribution, which understates the value of upper-funnel touchpoints and tends to favour branded and bottom-of-funnel keywords in performance reporting.
The more useful approach is to look at Microsoft Advertising performance within your wider attribution model, whether that is data-driven attribution, time decay, or a custom model built on your specific customer experience data. Evaluating Microsoft in isolation, against its own last-click numbers, will almost always undervalue it relative to Google because Google captures more of the branded and navigational queries that sit at the bottom of the funnel.
I spent a significant amount of time at iProspect working through attribution models for clients who were making budget decisions based on last-click data. The consistent finding was that channels sitting earlier in the customer experience, including Microsoft for some audiences, were being systematically defunded because they did not get credit for the conversions they influenced. The result was over-investment in bottom-of-funnel capture and under-investment in the channels that were feeding it. Microsoft Advertising was frequently one of the casualties of that misattribution.
The Optimizely piece on interaction effects in testing is a useful reminder that channels and touchpoints do not operate independently, and measurement frameworks that treat them as if they do will produce systematically distorted conclusions.
Common Mistakes That Cost Real Money
Beyond the import-without-reviewing problem, there are a handful of mistakes that appear consistently across Microsoft Advertising accounts I have audited.
The first is running identical ad copy to Google without considering that the Microsoft audience may respond differently. The demographic skew toward older, more professional users often means that more formal, benefit-led copy outperforms the punchy, urgency-driven copy that works on Google. Testing copy variants specifically for Microsoft is worth the effort on any account spending more than a few thousand pounds per month.
The second is ignoring the search partner network. By default, Microsoft Advertising includes search partner traffic from Yahoo and other syndicated partners. This traffic can vary significantly in quality depending on the category. In some accounts, search partner traffic converts well. In others, it is a source of cheap clicks that never convert. Reviewing search partner performance separately and excluding it if the data supports that decision is a basic hygiene step that gets skipped more often than it should.
The third is treating the Audience Network as part of the search budget. Audience Network placements should have separate budgets, separate performance benchmarks, and separate creative. Blending them with search performance in reporting makes both look worse than they are and makes it harder to optimise either effectively. The Moz Whiteboard Friday on CRO misconceptions makes a parallel point about mixing traffic sources in conversion analysis, the same logic applies to channel reporting.
The fourth is underinvesting in negative keywords. Because Microsoft’s search volume is lower, teams sometimes assume that negative keyword management matters less. It does not. A smaller volume of irrelevant traffic is still irrelevant traffic, and the cost of wasted spend on a platform where budgets are already limited is proportionally higher.
When Microsoft Advertising Makes the Most Sense
Not every advertiser will find Microsoft Advertising to be a high-priority channel. But there are clear situations where it should be near the top of the list.
B2B advertisers with defined professional audience criteria should be on Microsoft Advertising. The LinkedIn Profile Targeting capability alone justifies the investment for any B2B programme where audience quality is a conversion constraint. If you are spending money on LinkedIn Ads at £8 to £15 per click and getting frustrated by the economics, Microsoft Advertising offers a meaningful cost reduction for comparable audience targeting on search intent.
Financial services, insurance, and legal advertisers operate in some of the most expensive Google categories. CPCs in these verticals can be extraordinary, and the competitive density means that quality score optimisation and bid strategy refinement deliver smaller marginal gains over time. Microsoft Advertising in these categories tends to offer structurally lower CPCs with comparable conversion intent, because the same high-value keywords are less contested.
Any advertiser who has saturated their Google budget and is looking for incremental volume at a defensible CPA should be testing Microsoft before expanding into less intent-driven channels. The intent signal on search is the most reliable conversion predictor in digital advertising. Staying on search and moving to a less competitive platform is usually a better incremental investment than moving to programmatic display or social at the same stage of funnel.
If you are building a broader conversion programme and want to understand how paid search fits into the full picture, the conversion optimisation hub covers the strategic framework in more depth, from traffic quality through to post-click experience and measurement.
About the Author
Keith Lacy is a marketing strategist and former agency CEO with 20+ years of experience across agency leadership, performance marketing, and commercial strategy. He writes The Marketing Juice to cut through the noise and share what works.
