Marketing Excellence Microsoft

Microsoft is the world?s most successful software company. Bill Gates
and Paul Allen founded it in 1975 with the original mission of having ?a
computer on every desk and in every home, running Microsoft software.?
Today, Microsoft is the fifth most valuable company in the world and has
a brand value of $61.2 billion.

In the early 1980s, Microsoft developed the DOS operating system for
IBM computers. The company leveraged this initial success to sell
software to other manufacturers, quickly becoming a major player in the
industry. Initial advertising efforts communicated the company?s range of
products, from DOS to Excel and Windows, and unified them under the
Microsoft brand.

Microsoft went public in 1986 and grew tremendously over the next
decade as the Windows operating system and Microsoft Office took off.
In 1990, Microsoft launched Windows 3.0, a completely revamped
version of its operating system, including applications like File Manager
and Program Manager that are still used today. It was an instant
success; Microsoft sold more than 10 million copies of the software
within two years, a phenomenal accomplishment in those days. In
addition, Windows 3.0 became the first operating system to be
preinstalled on certain PCs, marking another major milestone for the
industry and for Microsoft.

Throughout the 1990s, Microsoft?s communication efforts convinced
businesses not only that its software was the best choice but also that it
should be upgraded frequently. Microsoft spent millions in magazine
advertising and received endorsements from the top computer
magazines in the industry, making Microsoft Windows and Office the
must-have software of its time. The 1998 slogan ?Where Do You Want to
Go Today?? promoted not individual Microsoft products like Windows 98
but rather the company itself, communicating that Microsoft could help
empower companies and consumers alike.

During the mid-1990s, Microsoft entered the notorious ?browser wars? as
companies struggled to find their place during the Internet boom.
Realizing what a good product Netscape had in its 1995 Navigator
browser, Microsoft launched its own, Internet Explorer later the same
year. By 1997, Explorer had grabbed 18 percent of the market.

Over the next five years, Microsoft took three major steps to overtake
Netscape. First, it bundled Internet Explorer with its Office product, which
included Excel, Word, and PowerPoint. This meant that consumers who
wanted MS Office automatically became Internet Explorer users as well.
Second, Microsoft partnered with AOL, which opened the doors to 5
million new consumers almost overnight. Third, Microsoft used its deep
pockets to ensure that Internet Explorer was available free, essentially
?cutting off Netscape?s air supply.? By 2002, Netscape?s market share
had fallen to a meek 4 percent.

Microsoft?s fight to become the browser leader was not without
controversy; some perceived that the company was monopolizing the
industry. As a result, Microsoft faced antitrust charges in 1998 and
numerous lawsuits based on its marketing tactics. Charges aside, the
company?s stock took off, peaking in 1999 at $60 per share. Microsoft
continued to release new products, including Windows 2000 in 2000 and
Windows XP in 2001. It also launched Xbox in 2001, marking its
entrance into the multibillion-dollar gaming industry.

Over the next several years, Microsoft?s stock price tumbled by more
than $40 a share as consumers waited for the next operating system to
be released. During this time, Apple made a strong comeback with
consumer-friendly products like Mac computers, iPods, iPhones, and
iTunes. Apple also launched a successful marketing campaign titled ?Get
a Mac? that featured a smart, creative, easygoing Mac character
alongside a geeky, virus-prone, uptight PC character. Apple?s campaign
successfully converted many consumers and tarnished Microsoft?s brand
image.

In 2007, Microsoft launched the Vista operating system to great
expectations; however, it was plagued by bugs and problems and the
company?s stock and image continued to slide, helped by the worldwide

recession of 2008?2009. In response, Microsoft created a campaign
titled ?Windows. Life Without Walls? to help turn its image around. Its
new message?that computers with Microsoft software were more cost-
effective than the competition?resonated well in the recession.
Microsoft also launched a series of commercials that boasted, ?I?m a PC?
and featured a wide variety of individuals who prided themselves on
being PC owners, hoping to improve employee morale and customer
loyalty.

In 2009, Microsoft launched Windows 7, an improved operating system,
with the campaign ?Windows 7 was my idea.? Four years later, it was
operating more than 30 stores like Apple?s across the United States and
Canada. Jonathan Adashek, general manager of Communications
Strategy, explained, ?We?ve welcomed more than 15 million customers
and counting so far, and have learned a lot from them. Having this direct
connection to our customers has really helped us better understand their
tech needs.? Travis Walter, general manager of Microsoft?s International
and New Store Formats, agreed, ?In person, you get a very different
experience and it?s one we?ve been very delighted to provide. When you
see our technology in person?when you can touch and feel it?a light
goes off.?

After the recession came to an end, Microsoft?s image and stock started
to recover, thanks to the success of its retail stores, effective marketing,
and a wide range of new product launches. Microsoft went after
Google?s dominant position in the search marketplace, for instance, with
a search engine called Bing, and it entered the growing mobile industry
with its Windows Phone mobile operating system. The company?s 2011
expansion into smart phones surprised many analysts, but Microsoft
hoped the smart phone and Windows Phone mobile OS would forge a
strong connection with its consumers around the world. It continued its
innovation momentum in 2012 with the launch of Windows 8, Windows 8
Phone, and a computer called Surface Tablet. The tablet impressed
consumers with a detachable keyboard that also served as its protective
cover.

Today, Microsoft offers a wide range of software, mobile, and home
entertainment products. Its most profitable products continue to be

Microsoft Windows and Microsoft Office, which bring in approximately 80
percent of its $86 billion in annual revenue.