Tuesday, January 09, 2007

If they sold sashimi, they'd call it cold dead fish

That was the criticism leveled at Hewlett-Packard back in the mid-80's. Personally, I think they would have called it "the best engineered cold dead fish", but the point is the same - their marketing sucked (btw, I'm using the broad definition of marketing which consists of the four P's: Product, Price, Place and Promotion). As a result, HP was routinely being handed their ass by Digital Equipment in the mid-range and IBM at the high-end. Flash forward to today, and many argue that MSFT has assumed that dubious marketing distinction. Okay, some might say that MSFT's is "Polonium-laced cold dead fish", but let's ignore the ABM whackers and OSS zealots for the moment and concentrate on the core charge. Is it accurate? Is MSFT's marketing really that bad?

I'm not sure that it is, but I do think that MSFT's marketing execution is hopelessly inconsistent and rarely gets the four P's lined up effectively. For example, a hugely successful viral marketing campaign like Origami, is followed up with a decidedly underwhelming UMPC that costs too much and has too little value-add. Similarly, we see amazing hype leading up to the Zune, only to have it come crashing down when a less-than-complete product was rushed to market. In other cases, such as Media Center, we see a very good product at a decent price that seemingly gets almost no direct advertising. Why? Or we see Office, another generally good product (albeit that there were too many marginal releases until recently), marketed with the now infamous "dinosaur" ads - it's always smart to insult your customers (NOT!). Even the Xbox, which has generally been a good product and reasonably well marketed (albeit still unprofitable), has suffered [at times] from chronic supply problems (e.g. Xbox 360 launch) and variable advertising. On the latter, who was the bozo who thought kids skipping rope outdoors was a good way to promote a gaming console - which is almost the antithesis of outdoor enjoyment? The recent Gears of War/Xbox spots are significantly better, but again - across products and across the company - where's the overall marketing consistency that typifies, say, Apple?

All of which brings me to CES - the Consumer Electronics Show currently going on in Las Vegas - and this week's developments. So far, in reading various reports, MSFT has seemingly managed to underwhelm. Sure, there's been some interesting announcements, but nothing much seems to have really captured the imagination of attendees or the media - well, except another mind-numbingly boring keynote by Gates and interview comments where he apparently joked that the Longhorn/Vista fiasco was "the best $6B I ever spent" - yeah, we shareholders found it a real gut-splitter. Meanwhile, compare and contrast to Apple - a company that lately seems to manage the four P's extremely well. They're having their Macworld event in San Francisco, and Apple's CEO Steve Jobs literally blew people away with today's announcements which included the very impressive iPhone (an impossible-to-miss reminder of what the Zune could/should have been) and the iTV. Indeed, just take a quick look at the "CES coverage" on Engadget for a hint at who's capturing early-adopter interest. Meanwhile, MSFT, with tons more R&D and resources, once again seems to be coming up short and is left promising games on Zune by "2008" - I shit you not - and trotting out executives live Robbie Bach to impotently trash talk Apple. Here's an idea: maybe you should keep your mouth shut and let your actions speak for you? Oh...that's right, they are - which is the problem. Seems to me that the "best management team" in MSFT's history would be focused on improving what's clearly wrong with MSFT's marketing rather than wasting cycles jealously mouthing off about those who seemingly have their act together. But hey, that's just me. And how's the market reacting to all this? Currently, MSFT is up $.03 and Apple is up $7.10. Go figure.

Update: Related - an earlier piece in which Joe Wilcox tries to make the case that MSFT's low-key marketing approach (including the painful Gates/Jobs mismatch) is actually a good thing (LOL!). He also predicted disappointment over the iPhone at CES this week (Oops! Bet he wishes he could rewrite that one.) and Gates' keynote not wowing the crowd (okay, that one was a gimme):


  • This review of Zune says it all:

    "Microsoft's typical "crawl, walk, run" development model isn't going to work, here. By the time Mr. Softy gets moving, the race will be over."

    I'm getting very concerned that for the next "race" we won't even be at the track.

    By Anonymous Anonymous, at 1:24 PM  

  • You have hit the nail on the head.

    Microsoft idea of marketing is a Product Manuals with color pictures. " that VX500RDRP v1 has blah blah blah. Let's add some color photos for the artsy types and have Ballmer/Gates give a speech."

    If MSFT built a time machine - Flux Capacitor (ala Back to the Future) they'd roll it out with a campaign on explaining Worm Holes while Apple would appeal to our sense of adventure, ability to meet Jesus (or John Lennon), etc.

    Marketing is an art, not a science. MSFT can't research it's way out of that issue. It's so painfully obvious. Science would never lead you to create an ad campaign showing babies sitting inside of Michelin tires to make customers care about a tire, or Nike ad that says Just Do it, appealing to the athlete we all aspire to be. MSFT would have issued a workout plan and tried to sell shoes to fat people b/c the demographic analysis says those people want to be fit.

    Enough of my bashing. There is a market reality that Microsoft has a brand identity that is not very elastic. I.e. customers don't afford the company to ability to morph in different ways, i.e. allowing license to get outside of buidling Office/Windows. The company is not trusted, is seen as big brother, home of millionaires and evil doers. In many ways the issue is reinforced by the cult of personality on the founders who make more money and talk about such crap, they further isolate the brand from being anything other than a huge tech company with lots of money, now lets us show you how we burn rolls of $100's in your face.

    I argue customers (CIO) or a kid on the street want MSFT to talk about technology, but in a way that isn't so Radio Shack.

    By Anonymous Anonymous, at 4:00 PM  

  • "This review of Zune says it all:"

    Good catch - I hadn't seen that one. Thx.

    "I'm getting very concerned that for the next "race" we won't even be at the track."

    Look at the action today (MSFT takes a huge hit on no news, while Apple tacks on another $4.40+). IMO, that was the market saying that Apple just lapped MSFT several times with their iPhone and [MSFT] investors are getting sick and tired of it. It's interesting that what's obvious to the market, still seems to elude Ballmer/Gates and the Board. IMO, we need a new Board and a new CEO who are prepared to take a chainsaw to the existing leadership team and current corporate structure if that's what it's going to take to get MSFT executing in internet time.

    By Blogger MSFTextrememakeover, at 4:36 PM  

  • To your AAPL vs. MSFT comparison, always amazes me how many people don't consider Apple a competitor of Microsoft's. I think it is one of the most serious competitors and just a glance at their performance recently shows you how they are winning against Microsoft.

    By Anonymous Anonymous, at 10:07 AM  

  • MSFT often points to GOOG as their main competition. Definitely one competitor among many, but AAPL definitely deserves more respect than MSFT has given it.;range=5y;compare=aapl+goog;indicator=volume;charttype=line;crosshair=on;logscale=on;source=undefined

    By Anonymous Anonymous, at 10:22 AM  

  • >IMO, we need a new Board and a new CEO who are prepared to take a chainsaw to the existing leadership team and current corporate structure

    IMO, a lot of fat cats are sitting as partners. Put a chainsaw to the partners as well.

    By Anonymous Anonymous, at 5:17 PM  

  • This post doesn't make sense, as it contradicts itself by listing cases where it's the products themselves that are bad, not the marketing.

    For example, everyeone would agree that the campaign for Zune was very effective in generating buzz, and the public enthusiasm lasted right up until the moment people got their hands on the product and saw just how bad it was.

    By Anonymous Anonymous, at 6:28 PM  

  • "This post doesn't make sense, as it contradicts itself by listing cases where it's the products themselves that are bad, not the marketing."

    Looks like you missed the qualifier in the second sentence: "btw, I'm using the broad definition of marketing which consists of the four P's: Product, Price, Place and Promotion". That was the point of the piece - MSFT often gets one or two right (e.g. product one time, promotion another) but consistently fails to line up all four, thereby impeding their success.

    By Blogger MSFTextrememakeover, at 9:11 AM  

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