Microsof t's share price has fallen by about half since late 1999. Mashable.com explains that the main reason is the mindset of the company that ignores the basic principle of marketing: focus on consumers and their buying behavior.
In February 2005, when Microsoft was still the world leading technology company, its position was explained by its CEO, Steve Ballmer. He said that the blood of Microsoft is its investment in R&D leading to continuous innovation, which will give people something they had no idea they could have. Emphasis was placed on the product, but it reflects the lack of the perspective of customers. Stock price is directly proportional to what could be called consumer energy: the more energy is on the market, the more brand ambassadors you create, the better your company will perform. The best evidence of this theory is Apple, whose market capitalization is greater than the value of Microsoft and Google combined. The price of Apple shares went up twenty-fold in the same period when Mircrosoft stock price halved!
How can marketing fix the problem?
- Focus on strengths. For Microsoft it's the software, productivity, and Xbox. It is along these lines its marketing should focus.
- Adopt strenghts according to the market developments. Microsoft Office is still not available for Android as well as iOS devices. Software for computers can no longer be the driving force of the company. Software with high productivity must now be developed for phones and tablets.
- Get rid of weaknesses. Smart phones are not the strengths of Microsoft. The similar applies to their search engines - and here Microsoft lost the war. It is, therefore, advisable to allocate the marketing budget elsewhere.
- Focus on marketing to consumers, not businesses. End users creates the energy you need. Firms are major contributors to the turnover, but their market is relatively saturated. Microsoft needs to get brand advocates energy that lifts up its share price.
- Collect quality information about customers. You need to know how they think, what interests them, what they're talking about, how exactly they use your products, and when and why they prefer the competition. To obtain accurate information like this you need individual qualitative interviews with customers, which can take up to 30 minutes each. Internet surveys and focus groups can not go in such depth.
- Communicate aggressively. When Microsoft will know what to say to customers, it must start patiently communicate in order to emphasize the quality of life of customers.
According to Mashable.com, a company cannot be truly successful unless they communicate life-improving products. However, Microsoft must first understand that it can no longer be just an engineering organization. Otherwise it can simple not get the drive from the market, which would finally increase its share prices.
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