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Obstacles test agility of new Microsoft ads

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Microsoft Corp.’s $250 million b-to-b advertising campaign, launched two weeks ago, represents a leap of faith for the software giant.

Dubbed "Agility," it presents Microsoft as a stable, reliable and trusted technology brand, one capable of meeting the demands of business customers. Developed by McCann-Erickson Worldwide, San Francisco, the campaign represents Microsoft as a provider of high-end technology solutions—a la IBM Corp., Sun Microsystems Inc. and Hewlett-Packard Co.—versus desktop applications.

But while McCann won praise for its creative execution, branding experts were not convinced Microsoft’s largest-ever campaign would hit its intended mark.

Among the complaints: The term "agility" is too generic to make an impact, the campaign interferes with an earlier b-to-b initiative called .Net and Microsoft’s identity as a product-specific marketer is too entrenched to overcome. Some also said the specter of the Justice Department’s proposed breakup of Microsoft for antitrust violations will cloud the message, which trumpets an enterprise solutions company able to provide end-to-end technology to business customers.

Four "Agility" commercials have already been prepared for broadcast. Using the cool and collected voice-overs of "Fargo" actor William H. Macy, each spot is a playful look at the critical role Microsoft plays in business operations. Print advertising, featuring case studies of such companies as retailer Marks & Spencer and cosmetics maker L’Oreal USA’s Maybelline, will appear later this month in publications including USA Today, The Wall Street Journal and The New York Times. The campaign will also feature a strong outdoor presence on billboards and bus boards, according to a Microsoft spokesperson.

New message, new tone

One TV spot, titled "Merger," shows an office packed up and ready to move. A voice-over indicates a merger of two companies is afoot. The ad says that when companies come together there will always be politics among people, but that with Microsoft software solutions the data is will work together. That message is a far cry from the edgy, product-specific marketing Microsoft used with the "Start me up" campaign for Windows 95 in August of ‘95, which was kicked off by "The Tonight Show’s" Jay Leno sharing the stage with Microsoft Chairman Bill Gates.

The "Agility" campaign is designed as the overarching b-to-b message for Microsoft for the foreseeable future, said Michael McLaren, exec VP-director of client services on the Microsoft account at McCann. He said the tagline, "Software for the agile business," cuts through similar verbiage from competitors HP, IBM, Sun, SAP AG and Oracle Corp.

"The agility promise will stand the test of time," McLaren said. "Microsoft needs to stand clearly for something in the business environment. We think agility is something that is incredibly tangible."

Critical publicity

The "Agility" campaign comes at a critical time for the Redmond, Wash.-based software giant, which announced revenues of $12.39 billion for the six months ended Dec. 31. Microsoft is coming off nothing but bad publicity from the Justice Department antitrust case, a stock price that has tumbled 40% in eight months and new competitive threats from the Internet as an application-delivery mechanism.

Unmistakable, too, is the business orientation of the campaign and its focus on business server software. No wonder. Microsoft got 70% of its $23 billion in fiscal 2000 sales from PC software. But PC sales growth has slowed and Microsoft knows it must find other revenue streams. According to International Data Corp., PC unit sales rose just 19% in the third quarter last year compared with a rise of 25% in the third quarter of 1999. The fourth quarter of 2000 was even worse, with sales growth at just 9.2% compared with year-earlier numbers.

On the other hand, sales of Microsoft server software and services rose 9% in the third quarter and 21% in the last quarter of 2000. And, according to IDC, its share rose to 26.4% of the $49.1 billion spent on server software in the first three quarters of 2000, compared with just 20.1% for all of 1999.

"Given the negative publicity in the last year, this campaign makes sense," said Alicia Stack, principal of high-tech branding consultancy Keen Branding Inc., Charlotte, N.C. "When you are a company like Microsoft, as large as they are and with as much control over the market as they have, it makes sense to focus on corporate attributes rather than product advertising."

Familiar theme?

Yet Microsoft runs the risk of muddying the waters with the "Agility" campaign, Stack said. The theme is too close for comfort to the identity already carved out by HP’s recently spun-off Agilent Technologies Inc., she said.

Another branding expert argued "agility" is too generic a word to build a campaign on. Microsoft would have been better served creating a proprietary word on which to build their b-to-b message, said Elizabeth Goodgold, chief of The Nuancing Group, San Diego.

"The problem with this campaign is that ‘agility’ is not an own-able word," Goodgold said. "If you search ‘agility’ on the Web, you’ll find it is part of 341 different domain addresses. Microsoft should have created an entirely new word, playing on their core strength." Goodgold noted that Microsoft President-CEO Steve Ballmer has cited the chief benefit of Microsoft’s software as "customer-centricity." "They would have been better off creating and magnifying a word like ‘centricity,’ " she said.

One branding expert blasted Microsoft for not coming on strong with Internet advertising, and questioned whether the campaign was created with the Justice Department in mind. Derek Bonney, VP-business development for interactive advertising agency ImagineThat Inc., Lisle, Ill., said Microsoft’s credibility is in jeopardy when it touts new technologies but does this primarily through broadcast, print and outdoor media.

Noting that Microsoft has appealed the legal decision to break it into separate software and operating system companies, Bonney saw "Agility" as a way to brace itself against the breakup. If Microsoft is highly successful in marketing its solutions, which straddle operating systems and applications, it will lend more credence to the argument that the two can’t be split without unfairly penalizing both businesses, Bonney said.

"This is a way to sweep around the antitrust specter," Bonney said. "The judgment calls for them to split the [operating system] and software solutions. When positioned as a technology solutions provider, it is harder to [break] those two pieces."

Mixed messages

Last July, Microsoft embarked on its .Net business strategy, which positions Microsoft as a provider of Net-centric applications and services. Kevin Johnson, Microsoft VP-U.S. sales and services, said there will be no confusion between "Agility" and .Net.

"As we continue to deliver on the .Net platform, the benefits of ‘Agility’ will be that much more dynamic and effective for businesses as they compete in the marketplace," Johnson said in an e-mail response to BtoB’s questions.

But a number of branding experts disagree.

James Dettore, president-CEO of Brand Institute Inc., Miami, Fla., said the "Agility" blitz runs the risk of overshadowing Microsoft’s earlier effort, and he argued that .Net does not fit neatly under the new "Agility" umbrella.

"If there is a sub-brand introduced prior to an umbrella brand, there are pitfalls," said Dettore, who nevertheless gave the "Agility" campaign thumbs up for execution. "It becomes more difficult to create the umbrella brand. Usually, a marketer will create the broad strategy and then move to the subset and subset brands. That usually means less time and less money."

There’s little question Microsoft needed to rethink its business messaging, said Daryl Travis, CEO of Brandtrust Consultants, Chicago. It has long been too focused on selling its operating system, server and database software at the expense of corporate identity. Meanwhile, Apple Computer Inc. and others have successfully created passionate computer cultures around their logos, Travis said.

"Microsoft has always been far too hung up on the kibble and bits," Travis said. "Just compare them to Apple, which has always presented itself as a higher calling. Apple is a company everyone wants to succeed, which is why they can make fatal errors and still come back."

A lack of emotional connection, if not outright ill will, on the part of some customers is another problem for Microsoft, Travis said. "If someone does come along with better enterprisewide solutions on the Web or through [open operating system code] Linux, there will be a move to that stuff because no one has any particular emotional resonance for the Microsoft brand."

Steve McKee, president of advertising agency McKee Wallwork Henderson, Albuquerque, N.M., praised the "Agility" campaign, which he said succeeds because it eschews the "petulant whining"’ that colored Microsoft campaigns of yesteryear.

A specialist in developing campaigns for high-growth technology companies, McKee cited Microsoft’s "Start me up" campaign for Windows 95, which featured a song licensed from The Rolling Stones and its defiant, full-page advertisements during the Justice Department lawsuit, as examples of Microsoft marketing gone awry.

"This seems like the first grown-up campaign ever produced by Microsoft," McKee said. "For all his brilliance, Bill Gates is kind of a tantrum-prone guy. And that’s shown up in Microsoft’s messaging. This campaign is appropriate for where Microsoft is right now." But he added, "They always have the danger of appearing as big as they are, and that’s the danger of this campaign."’

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