Microsoft Corporation’ Marketing Mix

Introduction

The sole purpose of the existence of any company is the production of goods and services that are vital to the customer. Organizations strive to ensure that they produce high-quality products to improve customers’ appreciation of the products. However, making high-quality goods does not guarantee that customers will embrace the products. An organization must have an efficient marketing strategy that would improve the competitiveness of the company’s products. Several marketing mix models may explain the company’s marketing strategy. The 4P’s (product, place, price, and promotion) marketing mix model is one of the models that may explain the marketing strategy of a company (Barker & Angelopulo, 2005).

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Overview of Microsoft Corporation

Microsoft Corporation is one of the largest technology companies in the world. Bills Gates and Paul Allen found the company in 1975. It derives a sizeable percentage of its revenue from the sale of software applications. The Microsoft Windows operating system and the Microsoft Office suite are the major software applications of the company. The Microsoft Windows operating system is the most dominant operating system globally. Windows has a market share of more than 90% (Pogue, 2010). Therefore, unless there are major changes in the market, the Microsoft Windows operating system will continue to dominate the market in the foreseeable future (Plunkett, Attner & Allen, 2007). Microsoft has several versions of the Windows operating system. The most recent version is Windows 8. Some of the Microsoft rivals in the development of operating systems include iOS and Linux.

Product

A product or service that a company offers must be able to meet the needs of its customers. Therefore, before launching a product, a company must undertake an extensive market survey to determine the unique needs of its customers. This would help the company develop products that meet the unique expectations of the customers. In the product offering, a company should include features that customers would use. It is usually expensive to include features that they would not use. This would increase the cost of production and profitability of the product. Understanding the unique needs of the users enables a company to develop products with different features that target different market segments. The physical features of a product also determine its competitiveness. Color, size and brand name of the product determine whether the market will embrace the product or not (Barker & Angelopulo, 2005). Therefore, it is critical for the company to use the most appealing color, size, and name for a product. In addition, a company may use a specific color, size, and quality to differentiate the products.

Microsoft develops various software applications that target different market segments. The Windows operating system has several versions that are aimed at different market spheres. Windows Starter, Home Basic, Home Premium, Professional, Ultimate, and Enterprise are the six versions of the Windows 7 operating system. The Windows 7 starter is the cheapest version of Windows 7. The manufacturer of a desktop or laptop computer usually installs the Windows 7 Starter before the sale. On the other hand, the Windows 7 Enterprise is the most expensive version of the Windows 7. Each version of Windows has different features. The Windows 7 Starter has the least features. This explains the low cost of the version. On the other hand, the Windows 7 Enterprise has the greatest number of features and is the most expensive version of the operating system.

The name of the Windows operating system affects the competitiveness of the product. Prior to the Windows 7, Microsoft used a different name for various types of the Windows operating system. The previous types of the brand were the Windows 95, the Windows 98, the Windows 2000, the Windows XP, and the Window Vista. The naming was synonymous with the year of issue of the operating system. However, in the Windows 7 and Windows 8, the company used a different naming system (Pogue, 2010). Despite the name ‘Windows 7″, Microsoft launched the product in 2009. On the other hand, Microsoft launched the Windows 8 in 2012, despite using the number ‘8’ in the name. It shows that the product is distinctly different from other types of the Windows operating system. The name ‘Windows 8’ signifies that the operating system is an advanced version of the Windows 7. The product relies heavily on the successes of the Windows 7 to successfully conquer the market.

Place

The availability of a product determines whether customers will buy it or not. Therefore, it is critical for a company to ensure that customers can find their products in the most convenient locations. To do so, an organization must have access to the most efficient distribution channels. A company may decide to often attend trade fairs, use a sales force, or sell the products online. A company may also consider the distribution channel of the competitors in determining its own distribution channel. This may enable a company to differentiate its products on the basis of the distribution channel (Barker & Angelopulo, 2005).

It is critical for a software application development company to offer its products online. Customers should be able to download the products at a certain fee, regardless of their location, as long as they have internet connection. Offering products online is a recent distribution channel for software applications. Distributing products using this channel has increased the sales remarkably due to the wide-spread of the internet. Traditionally, software companies sold their products in CDs or DVDs. Microsoft sells most of the Windows 7 operating system products in DVDs.

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This is due to the fact that downloading the operating system is not efficient to most customers. The size of the operating system may make the customer spend a considerable amount of time downloading the product. However, customers who have fast internet connections may download the operating system online. As the speed of internet connection increases, the internet promises to be the most effective method of distributing products in future. It would enable the company to launch new types of the operating systems simultaneously in various locations. Offering products online is cheaper than selling operating systems in CDs or DVDs. It eliminates costs that the company may incur in the distribution channels. This is because the company may sell the product directly to the customer.

Price

Price is one of the major factors that determine the demand for a product. A company should ensure that it prices its products effectively. The pricing of a product depends on the target market and the cost of production. Effective pricing does not necessarily mean that the company should offer low prices for its products. Sometimes, it is convenient to offer high prices for certain products. Reduction in the price may make the customers have the perception that the low price has compromised the quality of the product. However, in most cases, customers prefer the least priced products as long as they have qualities that are similar to those of the substitute products with high price. In addition, pricing of a product depends on the value that the product may offer to its users. In some instances, price controls may force companies to sell their products at a certain cost. Price control is mainly in essential products, such as fuel or certain foodstuffs (Barker & Angelopulo, 2005).

Microsoft offers different prices for different versions of the same type of the operating system. Both the Windows 7 and the Windows 8 have six versions. These versions are the Windows Starter, the Home Basic, the Home Premium, Professional, Ultimate, and Enterprise. The pricing of Microsoft products depends on the value that customers may obtain from them. The Windows Starter supports the least applications. Therefore, it is the least priced version of the Windows operating system. Large organizations use the Enterprise version. It has many features that benefit organizations that use the operating system (Pogue, 2010). Therefore, the Enterprise version is the most expensive Windows version.

Promotion

It is critical for an organization to increase consumer awareness of the existence of its products. This would help in eliciting demand for the product. A company should create a product promotion strategy that would enable it to reach its target market. In essence, profits from sales of a company’s products should repay the amount that the company used in promoting the product. A company should determine the most efficient means of advertising its product. Some of means of advertisement include billboards, radio, magazines, television, and word of mouth advertisement (Barker & Angelopulo, 2005). A company should ensure that it uses the most efficient means of advertisement, and advertises the products at the right time. In addition, company’s rivals may determine promotional activities that a company may use.

Microsoft has been able to conquer the operating system market with the Windows operating system and the Microsoft Office suite. The company does not rely heavily on television and mass media advertisement for product promotion. Microsoft relies on public relations (PR) in product promotion (Mohr, Sengupta & Slate, 2009). The main reason why the company does not depend on television advertising is due to the fact that the company has a sizeable share of market. It relies on various corporate social responsibility initiatives to improve and maintain the image and reputation of the company. Bill and Melinda Gates Foundation and the Microsoft Corporation support various initiatives that improve the welfare of people in the community. This boosts the image and the reputation of the company significantly. The company will continue using PR to improve its image in the foreseeable future. Increased online sales of the company’s products necessitate the company to use online advertisements to promote its appliances. However, this necessitates the company to have a foolproof method of obtaining online payments for the product.

Conclusion

Microsoft has conquered the operating system market. The company has monopolistic control of the market. The company has conquered the market due to various strategic decisions that the management of the company have taken. However, stiff competition from other companies, such as Apple, necessitates the company to undertake several measures to consolidate its position as the market leader. However, it will take many years for competitors to challenge Microsoft position in developing the operating systems.

References

Barker, R. & Angelopulo, G.C. (2005). Integrated organisational communication. Cape Town: Juta and Company Ltd.

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Mohr, J.J., Sengupta, S. & Slate, S.F. (2009). Marketing of high-technology products and innovations. Upper Saddle River, NJ: Pearson Education, Inc.

Plunkett, W.R., Attner, R.F. & Allen, G.S. (2007). Management: Meeting and exceeding customer expectations. Belmont, CA: Cengage Learning.

Pogue, D. (2010). Windows 7: The missing manual. Sebastopol, CA: O’Reilly Media, Inc.

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