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Describe and evaluate strengths and weaknesses of their distribution approach and make suggestions for
their future development
By Vinayak Nandikal
Company introductionMicrosoft Windows
Product descriptionDistribution channels
• Individual sales W&S• Included with the PC W&S
Recommendations for future developmentsLive Search
Service descriptionDistribution channelsWeaknesses and StrenghtsRecommendations for future developments
Conclusion
Table of contents
Created in 1975 by Paul ALLEN & Bill GATESIn 2008 it is 91,259 employees in 105 countriesTwo Main products:
Other products: MSN, Encarta, PC accesories, Xbox
Microsoft WindowsAn Operating System(Main software of a PC)Price of Microsoft Windows in the USA:
Distributed individually or included with the PC
Microsoft Office 2007
Individually distributed You can buy it online at Microsoft stores or
any of their online distributors You can buy it at a physical store(computer
store, supermarket) You can use it at different places without
buying it for e.g: universities You can receive it from a Microsoft
donation
Weaknesses
Piracy:244 copies sold in two weeksin China
A cost:Low demand but have to provide this solutionDonation is not a short term strategy
Strenghts
Piracy:“let them pirate software developed by Microsoft -that increases the overall number of Microsoft software users and some of them may
eventually convert into paying customers.”
You get some market shares rather than profit
You can even beat your competitor(Linux requires more discs in some cases)
A better image;A Microsoft dependency
Included with the PC
Distribution channels are then the same as the ones of a PC
Bundling:from http://www.investorwords.com/620/bundling.html
« The practice of joining related products together for the purpose of selling them as a
single unit. »Illegal in most of the countries
Weaknesses
Under the threat of a huge trial (March 2004, the EU ordered Microsoft to pay €497 million)
Introduction of new competitors & low cost products:
Less profit on those products for e.g Windows XP on eee pc at 49€
Customer behaviour can drastically change
Strenghts
If Microsoft closed, the economical impact will be terrible;
Microsoft is almost unmovable, even if not preinstalled, customers are requiring it;
Some countries even authorized bundling(case of China) to face Piracy;
Customers are ignorant and mentality are hard to change;
Recommandations
Hard to recommand Microsoft something Build an image such as setting up a « we are
the good guys » policy by being more present in people's life(offering more products, training in public places)
Live Search
Microsoft Search engine A recent technology for Microsoft(2004) Google(1998), Yahoo(1994), Baidu(2000) How Live Search can be so successful?
Leading the market in only four countries: Colombia, Honduras,Rep. Dom, Angola
Distribution Channels
Through Internet, the user is then free; Software, for e.g: Java, the user can be
locked; Hardware, the user can be locked; Web applications, for e.g: Facebook, the user
is locked; His own products and services, for e.g:
hotmail, the user is locked;
Weaknesses
A bad product(more resquests made from MSN rather than on Live Search itself)
Give a bad image of the company Increase the unsatisfaction
Strenghts
Through those techniques Microsoft can overcome some barriers that its competitors cannot such as nationalism
To use those channels you need high capital and to have a large range of products and services
They invest too much time in setting up good distribution strategies but what will happen if the customer discover the situation(being locked and using a bad product);
Microsoft should think about improving the quality of his technology in this field
Think too much about marketing(changing the layout, changing the name... « Kumo »)
Recommandations
Conclusion
“Bill Gates was not a computer wizard but a genius of marketing.”
“I do not think that a company such as Microsoft
Thinks about going bankrupt”
Their distribution channels are until now unbeatable
They should however as a security take care about their image, in the field of technology threats can happen at any
time
THANK YOU FOR YOUR ATTENTION