The Tom Dougherty Blog



Posts tagged “Microsoft”

Careful Microsoft, tablets are a risky venture

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To no one’s surprise, Microsoft will be releasing its own line of tablets, called Surface, and, while its tablet cover/keyboard is a pretty darn cool spin on things, I am not sure how the actual tablet will do. My issue with tablets is that Apple has, for all intents and purposes, done so well on its first go-around that the iPad has become synonymous with the category. The same can be said for the likes of Thermos or Kleenex, the brands so engrained in the markets their brand is often interchanged as the product itself.

So far, some manufacturers have tried their hand in the tablet market, but they seem to fight over the scraps and never make up ground against Apple. So far, there has been Sony, Samsung, Amazon, Dell and a few others. Some of them are better suited and have more brand permission releasing a tablet than Microsoft.

The tablet comes at a time when Microsoft is making some nice strides that can set it apart. It new Smart Glass is one of those things. It is fresh and, with additional “like” offerings, Microsoft is setting a foundation on which it can create a rebranded image for the company.

Tablets, however, are another story. This late in the game, you aren’t seen as being terribly innovative if you come out with only slight modifications (especially by one considered to be a software manufacturer that often makes things complex or, to be snarky, came out with Zune). You have to defend your product against an overwhelming category leader that has the best brand in the industry (in the world, really).

For Microsoft, there is some opportunity in the tablet market if it can find the highest emotional intensity and align itself with it it to give consumers the switching trigger they need to make the jump. Unfortunately, I think the market leader already has it.

There are a lot of things I see Microsoft doing that feel right, but tablets feel wrong. To regain some of the clout, it needs a game-changer.

Even though there are aspects if it that are cool, this ain’t it.




Nintendo’s Wii U is trying to be too many things

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The gaming industry seems to be split up into two audiences: The serious gamers and those of us who play on less intensive platforms such as an iPad where Angry Birds and Plants vs. Zombies is enough to give you your fix.

Bridging those two audiences is a delicate achievement and is fraught with potential failure if your attempt is simply to copy what others are doing. Nintendo is in that spot, especially when it comes to its upcoming Wii U system.

Just ask yourself this: If you had an iPad in one hand and the Wii U in the other, which one would you choose? This is the position Nintendo is steering its new game console toward. Gaming on consoles and gaming on tablets, however, are different beasts with two different audiences.

If you ask most people who play videogames, they do not confuse blockbuster console games with the arcade style mini games the iPad has made popular. There are certainly markets for both, but they are not the same. Pricing structure is different, required resources are different, marketing is different, user interaction is different, and visuals are different. Most of all, the complexity is different. The audiences for these are serious about gaming. The audiences for the iPad games usually aren’t.

Nintendo is also considering a new social network it calls Wiiverse. The problem is that the market has already demonstrated that people don’t want more than one social network. Just look at Google+, Ping, or MySpace. I greatly doubt if people looking for consolidation of their social network experience would choose Wiiverse in place of Facebook.

Nintendo’s system will still make a splash. It has enough loyal fans that will want their exclusive titles. But its attempt to create “broad appeal” is not the most competitive approach, not when competitors within each specific market are doing “specific” very well.

I expected more from Nintendo. It needs to think again like a true innovator, then wii-ed like to play.




Microsoft and Skype: A match made in…

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It should come as no surprise that Microsoft, the future owner of Skype, fired most of Skype’s executive staff last week because that is, sadly for the execs, often the ramifications of company buyout.

The surprise is that Microsoft wants to take over Skype in the first place. There’s something in the Skype brand that feels from an earlier era, as though it’s been passed by in the era of Facebook chatting, AIM iChat, Yahoo Messenger, texting, FaceTime and smart phones.

And that’s exactly how Microsoft feels too.

Brands involved in any merger or buyout should be related either by industry or, more importantly, brand promise. Otherwise, no equity is carried over from one brand or another – and the new company and its promise become less believable.

One that got it right: FedEx and Kinko’s. They were not in the same business, but they had a similar brand promise. Both promised “peace of mind.” (“If you have to get it there…” “We are your office away from home…”) FedEx Office emerged and made sense to the public.

The Microsoft and Skype brand promises fit well together too, but for all the wrong reasons. They both feel overly complicated, out of touch and outdated. The buyout is Microsoft trying to catch up in the technology race with a wheelbarrow.

Both can change that perception, of course, but it means an overhaul, not just of the brands, but also in operations, research development and business model. It must also start with Microsoft’s own brand because, however Microsoft uses Skype, the Microsoft brand will play into the success or failure of Skype – no matter what form it all turns out to be.

Will Microsoft simply dismantle Skype and make its product offerings part of Microsoft? Rebrand it altogether? Leave it alone?

Those are important decisions that must be dictated by market forces and the desires of target audiences. (And finding those things only comes from quantitative research that goes beyond measuring simple attitudes and usage.)

But those decisions alone won’t make the difference between success and failure. If Microsoft doesn’t fix its own brand first, Skype will continue to feel complicated, out of touch and outdated. Because that’s what Microsoft represents as well.




Windows Phone 7: A case study in beautifully executed advertising with the wrong position

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Regular readers of this blog, and those who have worked with us, know we at Stealing Share consider Apple to have the most powerful brand in the world, which is why we’ve often mocked recent attempts by competitors to take on the iPhone.

I’m still fully in this camp, but let’s give the Windows Phone 7 the benefit of the doubt for a moment to make a larger point that marketers must consider.

The main message in the current “Really?” TV spot is “It’s time for a phone to save us from our phones.” That strategy is executed perfectly. The scenes of people so focused on their phones – even if they are at an urinal – are hilarious because we’ve all seen scenes like that or, if we’re really honest with ourselves, done them ourselves.

Even the payoff, that the new phone is built to get you in and out, fulfills the promise of the “Be Here Now” brand position. And it’s different than the competition.

Kudos, right? Yes, if the position was the single most emotionally persuasive thing Microsoft could say to get you to switch phones. If the brand position was right.

That’s the problem. The brand position is ridiculous.

For it to work, you’d have to see yourself as the one who uses your phone too much – like the husband ignoring his wife – and wants a phone less involving. A customer would have to say, “Sign me up. I want a more boring smart phone!”

None of us believe we are those people – even though, obviously many of us are, just not all the time – or want to be associated with that. Those are other people.

For a brand message to work, you have to find the highest emotional intensity in the market and align your brand with it. It sounds like to me that Microsoft asked the wrong questions in doing its research and ran with it. No doubt, it asked: “Do you think people are too involved with their phones and not with their lives?” The answer was, of course, “Yes.”

But that doesn’t mean that answer is important.

It’s like asking, “Do you like the tile at Walmart?” Then, if everyone said yes, Walmart would market the tile. Just because it has a positive response does not mean it’s important when choosing.

At Stealing Share, we have ways to unearth those emotional intensities that are important. Microsoft could have used them, but all marketers must also remember that a brand message works when it is an aspirational and emotional reflection of the target audience.

If you believe you are that one who is too involved in your phone and would like to change, then the Microsoft messaging works. If not, then all Microsoft has done with its perfectly executed advertising is make you laugh at others while you wonder how bland the Microsoft phone must be to so uninvolving.




Microsoft: $80 million is a terrible thing to waste

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This week, Microsoft launched a new campaign for Office 2010 to the tune of $80 million. The problem – and its a problem with Microsoft in general – is that its advertising is not meant to steal market share. Rather, it is intended to get people who already use Microsoft products to switch…to another one of its products.

Microsoft is hurting in the office arena and are hoping that this new Office version will bolster its sagging sales. Business spending has been slow to recover out of the recession, hitting  Microsoft Office especially hard. Microsoft Office sales are down 3% year over year as consumers are using what they already have or moving to web apps from companies like Google. That is ironic considering one of the features of Office 2010 is its ability to be used on the Web from “virtually anywhere” (as long as you have Microsoft SharePoint or Windows Live SkyDrive).

So what Microsoft hopes to do with its advertising is to convince you that Office 2010 is better that your older version of Office because it can do more and let you share more stuff on the Web. Funny, I know of some pretty large companies who still have older versions of Office as the corporate standard because the older one “works just fine.”  The new ads feature a continuation of sorts from the Windows 7 “people” themes in which users show what the new version of Office can do.

The real problem is that, not only is Microsoft’s latest campaign designed not to steal market share, it does not stop those leaving Office from continuing to move. It is simply to get people to stop using a previous version and use 2010. Unfortunately, this is just another example of asking an ad agency (JWT in this case) to provide a solution to the wrong problem.

Companies are constantly spending enormous amounts of money to get their messages out – whether or not the message is important. Organizations are relying on agencies to provide great creative for their latest product, service, promotion or awareness campaign when the messaging is centered around product benefits.

Those agencies cannot do their best work if they cannot address the right questions that can only be answered with a deep understanding of your users and, more importantly non-users, and how they define themselves in terms of their self reflection and aspirations. That’s what steals market share. Not “updated” product benefits.




Microsoft's Kinect is an advance, but it's still "following"

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With the emergence of Google and Apple as brands, Microsoft is threatening to become irrelevant as a technology company – or, at least, a commodity in all the areas it plays.

I have been thinking about Microsoft quite a bit lately, and there are all of the usual reasons why it’s falling behind. It is competing against two of the most powerful and meaningful brands in the world and its technologies across all areas are gaining reputations as followers.

Nowhere is this becoming more apparent than in gaming, where Microsoft’s Xbox 360 is trailing the Wii and Sony’s Playstation in global market share.

The Wii, of course, has transformed the market with its remote, active capabilities and now owns 49% of the market globally, although that’s primarily because of its dominance in Japan. The Playstation is second and the Xbox trails with 20%.

In an attempt to catch up (that is, follow), Microsoft is about to introduce the Kinect, which takes Wii’s technology one step further. This controller-free system has a camera that, according to Microsoft, recognizes faces, obeys voice commands and tracks body movements, meaning gamers will simply control the games with their bodies in the simplest fashion.

There are a whole host of difficult questions Microsoft needs to ask itself about this “innovation” – primarily, whether gamers actually want it. It’s possible it may feel more like a novelty, something I sense about the Wii as a kind of consumer fatigue sets in. I have friends with teenagers who have more than one gaming system, including the Wii, and they prefer one of the remote controlling systems.

Beyond that, is there anything in the Xbox brand that gives consumers (mostly young ones) a reflection of themselves other than as a technology follower? I ask this because Microsoft’s largest problem is that it seems to think it’s all about the technology.

It’s not. The technology simply fulfills the brand promise and, when the (former?) technology giant is following the likes of Apple, Google and Nintendo, it must reconnect with consumers in ways more meaningful than simply upping the technology ante.




Notes on Apple, Verizon and the destruction of the BP brand

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To catch up after the Memorial Day weekend, some thoughts on a few items that transpired over the last week:

• Apple has now surpassed Microsoft as the world’s top tech company, something that has been a long time coming – and was only a matter of time. While Wall Street analysts have more confidence in Apple because of its ability to innovate products, it’s much more than that.

It’s about brand, and Apple’s ability to be more relevant to consumers and their belief systems (“Simple is always best”) as the world moves forward and seems more complex. Microsoft, and even its Windows 7, feels like old and overly complex technology anymore, and it has become a follower (anyone remember Zune?) rather than a leader.

The simple fact is that Apple, which we have often called the best brand in the world, has rarely, if at all, made a brand mistake over the last decade. Microsoft will need to re-focus its brand to compete or it will continue to lose market share.

• Speaking of Apple, reports are now that its rumored deal with Verizon is dying, or at least postponed. There are a handful of reasons being bantered about, including incompatibility of technologies and Apple’s exclusivity contract with AT&T.

But those issues can be worked out. The Blackberry runs on several networks, so it’s hard to believe Apple can’t make that work. (And even Verizon statements seem to suggest the technology isn’t the real issue.) Also, contracts are always renegotiated in business and reports were that AT&T and Apple were talking.

What is more revealing is the theory that Verizon, as it did when Apple was first approaching carriers for the iPhone three years ago, is balking at sharing revenues with Apple – and, instead, is moving ahead with Google’s Android phones.

Since then, this has been a shortsighted strategy as AT&T has taken market share from Verizon and, depending on which report you trust, AT&T has now become the market leader.

I still think it’s shortsighted, but a partnership with Google is an fascinating lob into the field because of the power of the Google brand.

But here’s the catch: Google’s brand is much more meaningful than Verizon’s brand, and how the brand architecture is developed will determine success.

My feeling is that it’s probably too late. In addition, if Verizon chooses to take the brand lead and ignore the Apple-AT&T model, it will still be chasing and falling behind.

• What to do about BP? If the oil giant ever gets the Gulf oil spill figured out (and it still doesn’t look good), what is BP to do about its brand, which has been based on a “green” outlook?

There’s no other way to put it. BP must start over. It will need a completely new brand because the current one, which it has held for more than two decades, is no longer believable and is a constant reminder of a epically failed promise.

Already, there are protests and boycotts, and BP will eventually have to uncover the highest emotional intensity among gas-buying consumers, one that may even be a negative.

From a brand perspective, a negative intensity is often the most emotionally powerful one in the market and brands that align themselves with that negative intensity can become more relevant than its competitors.

This is the rare example of total brand destruction, trapping BP in a brand that was barely believable and emotionally intense to begin with, and now is another casualty in this disaster.




Apple continues to roar

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It gets said a lot – and not just by me – but it’s worth saying again: Apple is the best brand in the world. So when analysts are shocked that Apple is not only profitable in today’s economic climate but actually thriving, I’m just as stunned they didn’t see it coming.

What else would you expect? No brand does a better job of creating preference among consumers than Apple does.

apple-logo11It does everything right. Apple has created a brand about who the customer is when they use that brand, a rule so many brands fail to follow. In this case, Apple consumers believe they are ahead of everyone else and want everyone else around them to know it. (That’s why the recent Microsoft’s ads hit so close to the bone - “Maybe I’m not cool enough for Apple” - even though those spots have been mocked.)

Apple is also so consistent. Even the packaging feeds into that sense of simplicity and innovation and ease of use. That’s another brand rule companies fail to follow through on. Even one action not on brand is a negative, people.

Apple has transformed the music industry (iPod) and the cell phone industry (iPhone). And it’s done it by following the rules of branding to the nth degree: Being about the customer (the one who looks ahead and likes to show off about it), positioning it against the competition (stodgy PC) and living the brand in every aspect of its business, not just marketing. (The marketing, though, is brilliant. The “I’m a PC” and “I’m a Mac” ads are brand marketing nirvana. This is who I am when I’m a Mac user. This is who I am when I use a PC.)

That’s why when Steve Ballmer, Microsoft CEO, says Apple users are only buying a logo, it demonstrates that he doesn’t get it. What those users are buying is themselves – and the power of that approach is proved in the numbers.