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Microsoft Marketing Approach of Office Live to Small Businesses - Marketing Case Study

7 pages
1810 words
Sewanee University of the South
Type of paper: 
Case study
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Small and medium enterprises have challenges in securing web-based marketing and advertising platforms. The cost of available online marketing software is beyond reach for many small businesses. They operate with minimal costs and therefore, cannot stand a chance to afford expensive software that can only be managed by many big firms and organizations. Therefore, in this context, Microsoft Corporation established a solution to this problem that many medium and small businesses faced while trying to market their products and business at large. Microsoft had the sole intention of helping such small firms and enterprises to attain full business ambitions even on the online platform that many people have gradually shifted to use.

Building an online service that allows small business to interact with numerous clients would be the greatest ambition of Microsoft. Subsequently, this case is about business-to-business marketing and the promotional approaches used by Microsoft Company to buttress the introduction of a new Internet service platform known as Office Live. In this package, Microsoft Corporation aims to assist medium and small-scale businesses in helping them tap the benefits of Web-based marketing useful in enhancing and developing a business. To attain this marketing idea, Microsoft engaged the services of Rovion Inc. to execute this online advertisement and marketing platform. Concisely, the case unfolds a series of responses from marketing professionals and other analysis on this new drive, and it states the effects resulting from the use of Office Live on businesses. The case explores the market for online-based services, the Web-enabled programme for medium and small enterprises, and competitive nature in this segment. The paper shall also offer alternative insights into Microsofts move to provide online marketing services, and how the move shall play out in an industry, which also have players from other technology giants such as Yahoo and Google.

An interesting aspect of this case is that Microsoft was able to identify the online marketing problem facing small companies and moved in to provide sufficient solution to their challenges. As a technology vendor, the company moved with speed to ensure that they tap the new market and that formed a fundamental strategy to increase the sales of the company and also an opportunity to realize growth resulting from new move to capture and offer services to such groups. It is fascinating that Microsoft was able to launch new online-based marketing software to help such small businesses accomplish their potential. Majorly, the scope of this case entails the development of this online-based marketing technology, how the Office Live services solved the problem faced by small and medium enterprises, as well as fundamentals questions that readers can learn from this case.

Office Live to Small Businesses

Late 2006, Microsoft, one of the biggest software firms, introduced a web-based ad campaign to help small business engage in online marketing and interactions with potential customers. Primarily, Office Live, which earlier existed in beta-test phase from February 2006, had the opportunity to reach the market. With this kind of launch, the company primarily target small enterprises that rarely use any business software to carry out their daily operations (Anderson et al. 2009, p.45). The service was meant to act as a game changer for such small and medium businesses that hardly apply any software in their market activities. Technology is critical for companies in the contemporary business world, and with this kind of idea, Microsoft hoped to solve and efficiently increase the operations of such business that could not afford such software in their activities. The Office Live would help the medium and small enterprises to make a presence on the Web as well as market the entire business in the online world. The creativity of Microsoft would lead to the provision of a free entry-level package, Office Live Basic, while the other two sets would be available upon subscription (Anderson et al. 2009, p. 50).

The promotional platform created by Rovion Inc. enabled the client's display video clips of the individuals who appeared as though they were openly networking with the web visitors. The pictures relayed were without borders and seemed to integrate flawlessly with the web page contents. In fact, the technology appears similar to the one termed green screen typically used in television and movies to create special effects (Vitale 2011, p. 26). This technology espoused a clear window within the Internet pages to talk with the visitor on that particular page. Michael Schultz, the chief marketing lead for this new service expressed optimism that the Office Live is one of the affordable and more accessible approaches for small and medium enterprises to market their products online (Slywotzky et al. 2007, p. 68).

The technology provided by Rovion Inc. was efficient and wholesomely targeted customers innovatively on how they apply Office Live to entice new clients and replicate the same kind of successful business by having a professional Internet presence (Slywotzky et al. 2007, p. 100). The technology also faced significant criticism from some web-hosting experts. Even though some experts viewed this new online marketing as an innovative approach, some critiques resented by suggesting that such advertisements would be intrusive and may generate aggravation to the online visitors (Anderson et al. 2009, p. 35). It is normal that expert has different views on such aspects as this one about Office Live. However, the small business would reap the benefits of employing the services of this online ad software. For example, when the Office Live was in beta phase, many experts were disappointed after noticing that the software would not be part of Microsoft Office, as the name appeared to infer. Some felt that spreading Microsoft Office to Office Live would seem like a branding blooper and thus unwarranted. Others felt that much should not be interpreted from the free package made by the company as they view it as a strategy to attract new customers for the new software services (Michel et al. 2002, p. 50). However, the criticism from such experts would later fade following the performance of Office Live. The software hugely attracted many small-scale traders and other medium enterprises to acquire its services since it was a game changer in online marketing. The businesses stood to effectively market and present their products to the customers in the online world and this largely increase the sales and growth of enterprises.

Evidently, the case is very interesting since the manner in which Microsoft identified the challenges in market and came up with innovative ways must be applauded. Many tech giants largely concentrated in generating web-based marketing services that targets big corporations and business since they have the capacity to purchase them. This infers that small businesses were left in limbo and the online world would prove difficult to venture. The move my Microsoft was indeed interesting and promoted the concept of business. In an effective manner, Office Live addressed the challenge of online marketing and advertisement for small firms.

How Microsoft Solved the Problem

Through the introduction of Office Live; new advertisement platform, Microsoft bolstered the focus they had on small and medium enterprise software market. The intention was to improve the nature of business the company enjoys with other small firms. The company viewed this as a chance or critical growth and expansion since large parts of the market had stayed untapped by other technology vendors (Gupta et al. 2013, p. 48). The period was also essential since many companies were set up and business opportunities continued to grow, and a large chunk of them would need a relatively affordable software to help them market their products and enterprises at large (Anderson et al. 2009, p. 37). Schultz accepted that indeed Microsoft was making significant strategic steps in the small and medium enterprise segment (Slywotzky et al. 2007, p. 98). The company was also concentrating on incorporating Web-based actions in the new software as part of a crucial strategic move by the company towards having Web-based services.

In a nutshell, this appears as an attempt to counter the efforts as well as the advantages enjoyed by other technology vendors such as Yahoo and Google. According to Microsoft, businesses that have less than 25 computers and 50 workforces are small enterprises. Companies with computers between 25 and 50 or employees between 50 and 100 are medium-sized businesses (Slywotzky et al. 2007, p. 50). These two types of companies as categorized by the group were considered as those having similar operational needs, and the new Office Live software would efficiently address such needs. In Microsoft view, the primary business of small and medium enterprises would entail how to efficiently manage and track cash flows, engage with the new customers, as well as improving sales from the existing clients (Anderson et al. 2009, p. 35). Therefore, effective business-to-business marketing to such enterprises would be a great way to empower them.

The competitive landscape for the provision of web hosting was rife, and the Microsoft took a bold step to join the new market. Web hosting witnessed a robust competition and many firms fighting for the small and medium enterprise markets. For example, Yahoo costs for small enterprise hosting service roughly stand at $12 every month (Slywotzky et al. 2007, p. 45). It appears likely that Office Live platform would be a massive revenue generator through subscription fee and advertisement. Microsoft would also ensure that the new platform, Office Live would maintain a client-focused approach by concentrating on the user-friendly features and incorporated experiences across the products and services (Anderson et al. 2009, p. 47). In addition, the company would venture into establishing further marketing and other sales services to small-sized enterprises need and offer substantial customization support on the newly created Office Live. Having huge customer base, is essential for any company and Microsoft attracted small scale and brought them into board by creating an online-based marketing platform that makes it to identify with the small firms. In essence, the company attained huge sales through this service.

Another way that the problem was solved was through using Michael Porters concept, which encompasses a strategy where a firm or business implement some serious planning actions in the view to defend itself in the industry and stay competitive with the kinds of products and services they offer (Schmitt 2000, p. 60). This approach can both be offensive and defensive towards the position they have chosen to take in the industry. The Porters concept provides an advantage of the companies that employ them over their competitors by providing their customers with value by either reducing the cost of products or services they offer or having products that entail more unique features deemed appropriate to the customers. The same can be witnessed in the Microsoft product Office Live, which has fundamental features to attract the clients. The small businesses have found the new Web-based platform useful for marketing their businesses. The strategies of cost leadership and differentiation approach best explain the case scenario. The cost leadership touches on ensuring competitive advantage, and it does this by expanding the profit margins and reducing the cost of production thus making the firm realize a lot of pro...

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