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In this assignment, the learner has precisely described various strategies to turn around the market of the product Microsoft web TV. Due to lack of marketing and less focus on the product, Microsoft lost huge potential customers. The dial-up connection was the worst part of the product earlier and subsequently, the VBI download made the customers change their device and shift to the products of other companies. The MSN web TV had various features like Hotmail, MSN messengers, etc. but still, could not evolve in the target market due to the upgraded products of the competitors. The latest technology of broadband, 4G connections, Wifi and various other services has flooded the market. The SWOT analysis presented in the assignment has clearly stated the factors affecting the product Microsoft web TV.
The above chart clearly states the loss it faced in the years 2010-2013 due to its devices. This was a huge impact on the Microsoft Company that led the closure of its product Microsoft web TV. This, in turn, led the company to huge debt in terms of investors and also lost the reputation in the target market.
To evolve in this market again with the product Microsoft web TV, Microsoft has to think differently with its ability to bring more innovation and flexibility in the product to attract more customers. The marketing mix of this product is provided in this assignment in a detailed manner to make this product evolve in the market again. Integrating with social media and mobile service providers can gain more potential customers from the target market. The existing customers of Microsoft is an additional advantage to launch this product again with its innovative features as the customers have a complete trust with the brand of this product. With efficient strategy and planning with stakeholders, the product Microsoft web TV can be launched again in the market.
Microsoft Web TV or MSN web TV was a thin client or a light weight computer device which used a TV for display instead of a computer monitor. It was supported by online service. Web TV Networks Inc. was the developer of this product and its service. Steve Perlman was the person who suggested taking over Web TV and renaming it to MSN TV as he liked its features. In the business year 1997, this company was purchased by Microsoft Corporation and then was absorbed into the Microsoft Network termed as MSN. Web TV closed its financial year with revenue of around US$1,500,000 from Marvin Davis and then was sold to the Microsoft for an amount of $425 million. In mid-1990’s, most thin clients was placed as diskless workstations in terms of corporate intranets while Microsoft Web TV was placed as a consumer device in terms of web access. Microsoft Web TV was a product used as an adaptor which allowed the internet to be connected to the television set primarily for e-mail and web browsing. The setup was comprised of power line communication or cable internet access, a web browser, modem, wireless keyboard and connection and ADSL. It was a cost effective alternative in terms of a traditional computer connection to the internet as Microsoft Web TV never allowed much functionality, unlike computer-based web browser. Microsoft Web TV consists of a set top box with 2MB ROM, 2MB RAM, and a 100hmz processor. The inbuilt dial-up modem helped to browse the web, watch television with the continuation of browsing and enabled program recording in the hard disk. Later, Microsoft decided to put Internet Explorer and Microsoft windows on the device eventually. However, it was not a huge surprise provided Microsoft laser focus on Windows at that point of time. The main concept Microsoft Web TV at that time was to provide email services and web browser experience to the people who were not geeky enough to access actual computers. Microsoft Web TV had around 150,000 subscribers at that time and providing them eponymous service was the primary motto of the company Microsoft. Microsoft Web TV never had enough fan following but still had few hardcore fans. In the business year 2001, the brand Web TV was named MSN TV by Microsoft which served MSN messenger support and Hotmail services. Despite massive marketing push by Microsoft, the device never earned much popularity. In the year July 2013, an email was received by existing customers that the service provided by Microsoft Web TV would be shut down by September 2013 and customer service will be available until January 2014. This was the closure of the device Microsoft Web TV with a very few fan followers.
In this assignment, the learner precisely discusses the reason behind the failure of Microsoft Web TV and the methods that are desired to launch the product in the target market again. The learner used SWOT analysis to discuss the microenvironmental factor that affects the business of Microsoft Web TV.
Rebranding MSN web TV
In the business year 2001, after six consecutive years of Web TV’s founding, Web TV was rebranded as MSN TV and the Web TV division was closed. However, the engineers of Web TV continued to work as engineers under Microsoft, offering TV programming by the support of internet (Aral, Dellarocas & Godes, 2013). The employees were working on Microsoft IPTV technology and Xbox video game systems. The promotion of the Web TV was closed with the end of the contracts with Sony and Philips as well as RCA becoming terminated while Microsoft took over the subscribers of Web TV. The subscribers count dropped as the Web TV was subsidized hardware and Microsoft had individual subscriptions of each box with the end of subsidies. Hence, MSN started providing free usage of MSN TV boxes to the PC users who are subscribed to MSN as an incentive in terms of dial-up ISPs.
1.It was one of the early market entrants that had a solid background of the brand Microsoft which gained customer attention
2.The services provided by Microsoft was huge in the market compared to other companies
3.A wide range of services was provided to gain more customers such as search, news, messenger, etc.
4.As Microsoft was a parent company and has a huge range of customer with full trust, hence a huge range of customers got attracted with the entry of MSN TV
5.The inclusion of internet website was an additional advantage for Microsoft as it was the most popular application at that time which in turn gained huge customer attention (Boone & Kurtz, 2013)
6.The popular sub brands of MSN such as MSN explorer, Hotmail, and MSN messenger were hugely accepted by the target customers at that point in time
1.During those years the featured offered by Microsoft was similar with the features served by other competitors which lowered the revenue of the company
2.At that time Microsoft had many few outlet and also very low marketing strategies which led to loss of many potential customers
3.There were no innovative advancement in the features of MSN TV which led to loss of many subscribers and less demand in the target market (Eid & El-Gohary, 2013)
1.The application of internet in the market was empty. Hence, Microsoft could have come up with its innovative ideas to regain its position in the market.
2.Integrating with various mobile service providers and social websites could gain more potential customers as in this era people are more into the internet and social media
3.The existing customers of Microsoft could have been gained to sell the product MSN TV as they have a full trust towards the company
1.The competitors in the market were increasing which was a potential threat for the company Microsoft as they have the similar features
2.At those times the upcoming email services and news websites were hampering the features provided by the MSN TV (Davis, 2013)
3.The competitors were very innovative and launched various other features which gained more customers towards them
Failure of Microsoft web TV
The company Microsoft built a setup box that let one browse the web on the television over dial-up and it was assumed that it was going huge in the market with an appreciation of the customers. However, Web TV did not amount much. At the time Microsoft renamed the Web TV to MSN TV in the business year 2001, the device was obsolete in the market. This happened due to the rise of innovative ideas of the competitors which in turn Microsoft loss every potential customer (Borland & Lindgreen, 2013). There came a phase when people did not want to use the internet on television in terms of surfing the web or e-mail which led to decreasing rate of customers. Then the feature of VBI downloads was a technological dead end due to the up gradation of various technologies like streaming videos over wireless network and broadband system. The browser provided by Microsoft Web TV was very weak which made potential customers to leave the device and buy a new one. The subscribers left only because Microsoft could not provide upgraded technology and innovative features to MSN TV which was a potential threat to the company (Bharadwaj et al. 2013). The focus of Microsoft was too much on their future product XBOX that they forgot the risk of neglecting MSN TV. Echo star was a huge competitor at that time for Microsoft as they used to serve features like dish player, direct TV which made Microsoft web TV to fail. The dial-up connection was literally degrading at that time with the up gradation of wireless network and broadband which took potential customers of Microsoft away.
Broadband MSN TV
In the business year 2004, Microsoft presented MSN TV2 which is quite similar to the MSN TV with the features of broadband access, use of a mouse, shop online, e-mail services and chat. However, it used TV as an output device without the need of computers. Microsoft used Windows CE with additional changes and standard PC structure for modeling MSN TV2. The cost of operating system was too high which Microsoft considered as its sunk cost. This, in turn, enabled to use the device with reasonable price. MSN TV2 used different online services unlike MSN TV but needed a subscription for accessing each feature. The people who used broadband were charged US$99 per year (Leonidou et al. 2013)
According to Microsoft, there are four key stakeholders handling the situation of MSN web TV. The stakeholders played an integral part and were affected in huge due to the closure of the project. They should have concentrated more on their innovative features and should have followed the latest trend to satisfy the needs of existing as well as new customers. The stakeholders of Microsoft are:
Customers- The low progressing report and project costing of MSN web TV had a huge impact on the customers (Czinkota & Ronkainen, 2013). Initially, the project was really successful and well accepted by the customers but later due to the up gradation of technologies, Microsoft lost the target customers which in turn left the company at a huge loss. Depending on the target customer Gantt charts were prepared to raise the sale of MSN web TV but due to the increasing growth of competitors, the project failed eventually. Every detail of the project was shown to the target customers however it did not work out the way Microsoft wanted to.
Project manager- The project manager had assisted all the planning process, costing, managing resources, project progress and delivered the report to other stakeholders. However, due to the failure of MSN web TV, Microsoft could not be recovered with several approaches and planning. The planning they referred would have successfully marketed the project but due to the lack of customer buying approach, the project failed gradually (Myers, 2013).
Project team members: The members of Microsoft were very efficient to upgrade the project with the needs of customers. However, the rise of other technologies and devices in the market subsequently brought down the market for MSN web TV. Whatever the top management would suggest they use to follow but the lack of customer attention terminated the use of the device in the target market.
Other managers: They were handling the division of service providers and other contractors of MSN web TV but still they could not cope up with the dial-up connections. The subscription of each application was a major issue at that time which Microsoft could not handle efficiently. Due to which they have lost many potential customers from the target market.
Government: Microsoft considers all the government policies and terms as well as the contributions in terms of economic growth. The government took a huge part in influencing Microsoft for the product MSN web TV. However, lack of customers made this project a huge failure. Microsoft took the responsibility of consumer security, environmental impact and product safety following government guidelines in the business but still, this product could not evolve hugely in the market.
Investors: Microsoft did all the relevant financial reports and had a transparent view of its strategies for gaining more investors (Turnbull & Valla, 2013). However, with the help of investors, it came in the market with the product MSN web TV but could not evolve in the market as desired. This, in turn, led the company to huge debt.
4.Strategic recommendation: Growth and turn around strategies
In order to gain the position of MSN web TV back in the market again, Microsoft needs to follow the following factors:
1.Making the project a priority:
The basic failure of the project was its less priority while focusing on XBOX. To make MSN web TV effective in the target market, it has to be the main priority for the company. A lot of dedication is desired by each member of the company else the initiative will be in vain again (Christopher, Payne & Ballantyne, 2013).
To make this project success the involvement of each stakeholder is desired. The board members will find the scope for earning more money whereas the customers will desire to get features that they want for their own satisfaction. For making the project at success, this project must be appealing to each key stakeholder.
Marketing the brand efficiently would create more revenues for the company. Previously, the problem was less marketing of the brand MSN web TV which made people unaware of its features and abilities. At that time internet and surfing on TV were a huge accomplishment however lack of marketing made the company at a huge loss. The marketing campaign, TV ads, posters, leaflets, online marketing is required to make this device evolve again in the market (Kosinski, Stillwell & Graepel, 2013). The best marketing plan involves: strategic positioning in the target market in terms of competitors of similar products, marketing of the product is desired before anticipation, the creation of social media awareness and marketing campaigns and must know the ways to sustain the product in the market.
Providing efficient customer service in terms of website, emails and other relevant steps is desired to make MSN web TV at success. This product must be simple and easy to operate by customers, until and unless they are satisfied the product can never sell in the market. The initiative taken to launch the product again in the market must solely be in terms of customers (Zikmund et al. 2013). If they are satisfied then the product will sell eventually. Taking feedback from the customers and rectifying the issues that were done at the past will grow the sale of MSN web TV which in turn will be profitable for the company.
Marketing Mix of MSN web TV
Microsoft is into various products and services which include devices, apps, software, games, and entertainment. However, to evolve the product MSN web TV in the market it has to focus more only in this segment. The company has to evaluate the percentage it invests on the third party for better financial revenues. All the features and apps that have to be initiated in the product must evaluate eventually for further investment. Enhancing this product with the view of the target market would increase the diversification of its products. The product must be connected with the Microsoft’s generic strategy and intensive growth strategies to emphasize growth while penetrating in the target markets and serving the attractive product (Verbeke, 2013).
Place or distribution:
In this element, the places or locations for interacting with various customers is desired to get a possible outcome for selling the product MSN web TV. It must forecast its product in various venues which will include: Microsoft stores, authorized sellers and official website. The official website and online store will help customers to do online shopping; as in this trend, customers prefer to shop online rather than retail stores. This, in turn, will increase the revenue of the company. Additionally, the authorized seller will have a direct reach to customers in terms of sales and marketing. As the Microsoft stores have existing customers who would prefer the new product hence proper displaying of the product is desired (Shih et al. 2013).
Microsoft must focus on effective communication strategies to gain more potential customers. With the consideration of competitors in the target market, Microsoft must prioritize the following: public relations, advertising significantly, personal selling and direct marketing. They must concentrate on advertising the product in the huge term to gain potential customers as well must use the strategy of discounts and other incentives (De Mooij, 2013). It can use other organizations for branding its product by direct marketing. In terms of personal selling, they must focus on the product MSN web TV to the potential buyers. Effective strategies and planning are required to satisfy each stakeholder to effectively launch this product in the target market.
Pricing affects the attraction of various customers with the sales performance of the product MSN web TV. Microsoft must efficiently apply the pricing strategy on the product to gain more customers as it has already failed once. It must use market-oriented pricing strategy, where it should set the price in terms of the market demand and other pricing strategies of the competitors. It also must focus on free features on few applications while charging for additional features of the products (Majaro, 2013). This, in turn, will increase customer’s attraction. They can also charge on the usage of the services provided by the device without charging a higher price for the product. Customers always prefer quality product at reasonable price. Hence, Microsoft must efficiently come up with a pricing strategy for the product MSN web TV.
5. Reference list:
Aral, S., Dellarocas, C., & Godes, D. (2013). Introduction to the special issue—social media and business transformation: a framework for research. Information Systems Research, 24(1), 3-13.
Bharadwaj, A., El Sawy, O. A., Pavlou, P. A., & Venkatraman, N. V. (2013). Digital business strategy: toward a next generation of insights.
Borland, H., & Lindgreen, A. (2013). Sustainability, epistemology, ecocentric business, and marketing strategy: Ideology, reality, and vision. Journal of Business Ethics, 117(1), 173-187.
Eid, R., & El-Gohary, H. (2013). The impact of E-marketing use on small business enterprises' marketing success. The Service Industries Journal, 33(1), 31-50.
Kosinski, M., Stillwell, D., & Graepel, T. (2013). Private traits and attributes are predictable from digital records of human behavior. Proceedings of the National Academy of Sciences, 110(15), 5802-5805.
Leonidou, L. C., Leonidou, C. N., Fotiadis, T. A., & Zeriti, A. (2013). Resources and capabilities as drivers of hotel environmental marketing strategy: Implications for competitive advantage and performance. Tourism Management, 35, 94-110.
Shih, B. Y., Chen, C. Y., & Chen, Z. S. (2013). An empirical study of an internet marketing strategy for search engine optimization. Human Factors and Ergonomics in Manufacturing & Service Industries, 23(6), 528-540.
Boone, L. E., & Kurtz, D. L. (2013). Contemporary marketing. Cengage learning. Christopher, M., Payne, A., & Ballantyne, D. (2013). Relationship marketing. Taylor & Francis.
Davis, A. (2013). Just enough requirements management: where software development meets marketing. Addison-Wesley.
Czinkota, M. R., & Ronkainen, I. A. (2013). International marketing. Cengage Learning.
De Mooij, M. (2013). Global marketing and advertising: Understanding cultural paradoxes. Sage Publications.
Majaro, S. (2013). International Marketing (RLE International Business): A Strategic Approach to World Markets. Routledge.
Myers, M. D. (2013). Qualitative research in business and management. Sage.
Turnbull, P. W., & Valla, J. P. (Eds.). (2013). Strategies for international industrial marketing. Routledge.
Verbeke, A. (2013). International business strategy. Cambridge University Press.
Zikmund, W. G., Babin, B. J., Carr, J. C., & Griffin, M. (2013). Business research methods. Cengage Learning.
tannerhelland.com. 2017. Where does Microsoft make money? (Updated 2013). Tanner Helland (dot) com. Retrieved 24 March 2017, from http://www.tannerhelland.com/4993/microsoft-money-updated-2013/