Microsoft Corporation: The Introduction of Microsoft Works

Mohit Sharma (400807016) Nimish Mittal (400807017) Pawandeep Singh (400807020)

Contents
Introduction Situation Analysis Global Brand Strategy Standardization vs Adaptation Concept Testing Product Customization Local Adaptation Global Product Strategic Options Time of Market Entry: Waterfall vs Sprinkler Strategy Segmentation & Targeting Positioning Special Product Policy: Global marketing of service Testing Market Protecting brand names: Intellectual property issues Conclusion

Introduction
How Microsoft to launch their new product Works To decide how to position Works globally Microsoft had to respond to the requests from different country managers request on demanding product features that could make their sales excellent and competitive to the market

Situational Analysis
SWOT Analysis
Strength
Brand Image Product Competence Proven Financial performance Good experience in management teams

Weakness
Lack of International experience Although 41% international sales, but no mature global product policy

Opportunity
Good market potential Significant growth in long run Reduced time and cost due to standardization

Threat
Leading competitors No use of copy protection Short International Product Life Cycle (IPLC) Counterfeit products

Situational Analysis
Porters Five Forces Model
No supplier force restriction

Initial, switch and exit costs were low

Competitive forces were tough

Customer forces relied on its distribution networks

No advanced substitutes

Global Branding Strategies

Umbrella branding
Brand history Competitive climate Cultural receptivity Penetration in the software product category and usage Differentiated High brand loyalty, name awareness, and perceived quality

Standardization v/s Adaptation

Standardization
high costs of adaptation no really convergence and similar taste in diverse country markets no predominant use in urban environments - no marketing to predominantly similar countries no really centralized management no scales of economy in production, R&D and marketing partially yes meeting competition when competitors produce standardized product no consumer mobility no exactly if positive home country image (C-O-O) effect exist yes, brand name is the most important

Adaptation
different in technical standards some true, but some untrue primarily consumer and personal use products yes variations in consumers needs yes variations in conditions of use yes variations in ability to buy, differences in income levels yes variation in technical sophistication, skill levels of users yes strong cultural differences yes local environment-induced adaptation, differences in raw material availability, government requirements and regulations not exactly use by competitors yes variations in national habits yes

Hofstedes cultural dimensions

Country
Great Britain
Netherlands Sweden France Germany

National Innovative-ness
0.89
0.70 0.59 0.35 0.07

Individualism
91.48
83.70 74.81 71.11 68.88

Uncertainty Avoidance
42.22
63.33 32.22 88.33 68.88

Italy Spain
Portugal

-0.71 -0.85
-1.2

74.81 51.85
27.40

75.55 87.77
107.22

Conjoint Analysis of Microsoft Works

Country Low End International Version Compatibility features Perception
0.53

Low price or price sensitivity

Simple to use & sell concept

Suggested price (US$)

Forecast (Monthly sales)

US
Canada England Australia / New Zealand France (L) West Germany West Germany (L)

-0.12
0.13 0.32 0.32

0
0 1 1

0.61
-0.61 -0.61 -0.61

3.00
3.00 3.00 3.00

195
215 215 215

6000
500 1000 380

0.53 0.53 0.53

0.15 0.07 0.07

0 1 0

3.00 1.96 1.96

1.16 0.00 0.00

0.30 0.00 0.00

254 273 273

650 200 500

Conjoint Analysis of Microsoft Works

Country Low End International Version Compatibility features Perception
2.32

Low price or price sensitivity

Simple to use & sell concept

Suggested price (US$)

Forecast (Monthly sales)

Italy
Italy (L) Netherlands Netherlands (L) Portugal Portugal (L)

0.38
0.38 0.30 0.30 1.50 1.50

1
0 1 0 1 0

1.78
1.78 3.00 3.00 3.24 3.24

0.79
0.79 1.97 1.97 -5.51 -5.51

244
244 224 224 220 220

50
160 80 200 25 80

2.32 1.66 1.66 4.01 4.01

Sweden
Sweden (L) Spain Spain (L)

0.15
0.15 0.875 0.875

1
0 1 0

0.00
0.00 2.97 2.97

2.39
2.39 2.39 2.39

0.79
0.79 -2.26 -2.26

234
234 234 234

100
200 50 200

Product Customization
Core product approach
Microsoft should adopt the core-product approach that started with design of mostly uniform core-product domestic version of Works and then added attachment that might fit local needs like the special features toggle switch and conversion program. International version of Works fit for the local habits and customs. And finally fit the local language, user manual, and its packaging and documentation. Such approach could save a lot of costing that came from the centralizing the production of the core. The success would be due to the easy product modification.

Organizational Structure
umbrella strategies strength of control the technical competence decentralized power to the local teams own resource

Product Standardization
high volumes, capitalize on economies of scale and the experience curve, and achieve the lowest possible costs per unit consistent company image shared needs amongst those computer consumers that demanded similar products scale of economies

Local Adaptation
Difference in countries and language Difference in hardware Difference in price sensitivity Difference in local habits & customs Difference in package and documentation Difference in Microsofts competitive position and corporation image

Global Product Strategic Options

For US & Canada
product & communication extension strategies

In other international countries

product adaptation communication adaptation

Time of entry
Sprinkler Strategy Waterfall Method Time of Entrty.docx

SEGMENTATION AND TARGETING

Software Category Segmentation

Company Name Worldwide sales in 1986 ($ millions) Name(s) of few leading products Category of software products Expected sales of individual software 94.3 94.3 94.3 86.7 86.7 86.7 67.7 67.7 67.7 26 26

Lotus 283 development Microsoft corp. Ashton - Tate 260

1-2-3 Symphony Jazz DOS Excel Word Dbase 111 Framework Multimate Wordperfect Executive

GP spreadsheet GP integrated GP integrated SS OS GP spreadsheet GP word processor GP database GP integrated GP word processor GP word processor GP integrated

203

Word perfect 52

Software Category Segmentation

Company Name Autodesk Worldwide sales in 1986 ($ millions) 50 Name(s) of few leading products AutoCAD CAD Camera Category of software products SP Computer Assisted Design Product Expected sales of individual software 25 25

Borland
Micropro Digital Research Software Publishing

38
36 26

SideKick Turbo Pascal

GP Organiser SS Language

19 19
18 18 13 13

Wordstar GP word processor Wordstar 2000 GP word processor CP/M GEM PFS: Write PFS: File First Choice SS Operating system SS Operating system GP Word Processor GP Database GP Integrated

26

8.7 8.7 8.7

Targeting
Segment this portion 30.5%
Niche program 69

GP database 76.4 SS operating system, environ & language 131.7

GP Spreadsheet 181

GP Word Processor 225.1

GP Integrated 291

Segmentation by different aspects & Microsofts target

Computer Hardware Environment IBMPC or PC compatible XT Professional AT Home PS/2 Hobby Scientific Technical New Users Two byte language like Japanese or Asian countries Usage Situation Customers Depth & Clarity of software needs Depth Breadth Country & Language Domestic One byte language like English, French and German Small Business Large Business

Education

Positioning
Macro integrative and simple software Integrative, compatibility and flexibility User-Friendly, Harmonious & Integrative for Eternal PC users Microsoft Works An Integrative solution for The simple harmonious family

Difference between perception & expectation

Hardware Competitive Importance of position & target market corporate image segments Easy to learn and use The software of simple life Software with a future Public A/Cing Banking Fin. Services Architecture Construction Engg. Medical/Dental Legal Home Other Price Sensitivity Highly Moderate Other difference PC clone English type Local habits, customs & formats: Dimension unit Standard size of paper Time & Date Currency Copyright protection Packaging and documentation

Non English
Keyboard, printing program & user manuals

Less

Pioneers in compatibility
Power and simplicity together

Special Product Policy

Global marketing of services
establish its own global service global service marketing strategies standardized software training customized training course claimed back Information Technology BBS (Bulletin Board System) service real time communication IT complaint box

Testing Market
trial version (or version) of international or domestic one could be sent to the global dealers for market testing The new features or the compatible features could be tried with the dealers A prompt response through BBS could be obtained to lead Microsoft to see any bugs inside the software or convert a better product design. Of course such trial version would have a limited usage date that the dealers had to continuously buy the software.

Protecting brand names

Intellectual property issue
In order to have higher brand equity of Microsoft, the legal aspects such as copyright would be valid in US. However, other strategic options against piracy should be used, communication options like legal copies and licenses to avoid imitations. Microsoft did not use copy protection because it encourage the diffusion of Works usage in the lag countries. In certain maturity of time, legal actions would be taken to force the customer to buy the licenses.

Conclusion
adopt core-product approach quick to launch in the domestic market Compatible design Sprinkler and waterfall approaches product & communication adaptation options massive segment of general purpose integrative package user-friendly, harmonious & integrative for eternal PC users The integrative solution for the Simple Harmonious Family

Thank You