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Headquarters: Redmond, Wash. Brand established: 1975 2005 advertising: $463 million 2006 Interbrand/BusinessWeek ranking: No. 2 Brand value: $43 billion CoreBrand ranking: 3


STRENGTHS: Roth: Still the software brand and one of the most recognizable brand names in the world, based on a pervasive brand image and raw marketing power. But the halo effect of the Gates philanthropy phenomenon has managed to also “warm up” the Microsoft customer perceptions in the bargain, and this could add renewed vitality to the brand. Ries: Microsoft is the dominant force in personal computer software, especially among enterprise customers. This dominance is likely to continue for some time. CHALLENGES: Ries: The biggest challenge is Vista, Microsoft’s new operating system. If Vista sustains a round of bad publicity, Microsoft could be in long-term trouble. Roth: It’s a favorite target of all the Microsoft wannabes, and being super big and “lovable” is a hard balance to maintain.Microsoft Corp., which this year was ranked the No. 1 global brand by Millward Brown and Financial Times, has established itself as a trusted brand for business software.

Microsoft Corp., which this year was ranked the No. 1 global brand by Millward Brown and Financial Times, has established itself as a trusted brand for business software."Microsoft is a very strong, trusted brand in the marketplace," said Jan Lindemann, global managing director of brand consultancy Interbrand.

In this year's annual Interbrand/ BusinessWeek ranking of the top global brands, Microsoft ranked No. 2, just behind Coca-Cola.

"Microsoft has carved out a unique and well-established market position that is hard to rock, particularly with business software," Lindemann said. "Business people want to be sure their software all works together and is connected to previous software."

However, Lindemann added, while Microsoft has established itself as a trusted brand in the PC and enterprise market, it faces challenges as computer applications move to the network level. "The next battle is on the Internet," he said. "Google has won so far, and Microsoft is a challenger in this space."

Microsoft made a big b-to-b branding push this year with its "People-Ready Business" campaign, a $500 million global effort that launched in March.

The campaign, an integrated effort including TV, print, online and outdoor, is designed to communicate Microsoft software's value to business decision-makers.

" 'People-Ready Business' is incredibly important for Microsoft in the way we market, sell and relate to both business and IT decision-makers," said Mich Mathews, senior VP-central marketing group at Microsoft.

"It communicates our vision for businesses and how Microsoft helps customers achieve their business outcomes."

The "People-Ready Business" campaign is a corporate branding effort that encompasses Microsoft products for collaboration, content management, business intelligence, mobility and other functions.

Now Microsoft is gearing up for the launch of Vista, its next generation operating system that is scheduled to debut in January. Mathews said one of Microsoft's biggest brand challenges is making sure it has a successful launch of Vista, which happens at the same time as the rollout of Microsoft Office 2007.

"Some of our brand challenges include a crowded market, and the associated challenge of having our message clearly understood, and the fact that Windows XP was a great product. So we have a challenge in convincing our customers why they should upgrade," she said.

To do this, Microsoft is working on developing clear value propositions for the business, developer and consumer segments, each of which requires different strategies, Matthews said.

Internal studies find that brand strength has improved across all Microsoft's audiences, she said.

"We show a significant increase year over year on our image favorability with developers and IT professionals," she said. "Similarly, our Windows brand has grown on a mixture of measures including familiarity, favorability and advocacy." —K.M.

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