Brand value dries up in the Microsoft ecosystem
If you’re a Microsoft business partner in consumer markets, it’s becoming increasingly difficult to build your own brand, and brand value platform, within the Microsoft Windows ecosystem.
Microsoft controls the life-giving fluids in these parts, and it looks like they’ll be keeping most of them for themselves.
As Microsoft integrates products, partner brands wither
To compete with Apple for the emerging home media center market, Microsoft needs tightly integrated products that can deliver a consistent Microsoft brand experience—and leverage Microsoft’s market power. Xbox was the first major step in this direction, followed by Microsoft’s massive online makeover. Now there is Zune, Microsoft’s belated iPod challenger, launched yesterday.
It’s important to remember that brands are vertically integrated value. The more Microsoft integrates (its own) hardware into its offerings, as it must do to compete with Apple, the fewer brand options remain for hardware members of its ecosystem. They are being “integrated out.”
Mapping out the brand space
Xbox and Zune are aimed at the home media center brand space. Their mission is to condition customers to a Microsoft brand presence that promises a seamless integration of digitized music, video, movies and games. For the time being, it doesn’t matter how much money these products lose. In Microsoft’s view, they are tiny tumblers being set in place to deliver a lifetime of lock-in. When the curtain rises, it will be a Microsoft show.
Left high and dry
More than a few observers have noted that the new Zune effectively scraps Microsoft’s PlaysForSure digital player initiative, leaving its business partners for those devices (such as iRiver and Creative) high and dry. They are now competing with Microsoft.
Creating customers is the only brand option
If you’re a PC maker like Dell, Sony, Gateway or H-P, your only option to preserve your brand is to find new ways to create customers beyond the reach of Microsoft’s brand experience. If you don’t innovate along new customer dimensions, you are pretty much condemned to be an agent of Microsoft’s brand—and a future somewhere in that picture above.
Some possibilities
In consumer markets, H-P is leveraging its imaging expertise to integrate more imaging and printing capabilities into its PC lines, thereby redefining its brand experience away from a straight Windows PC experience. That’s one reason why its “You and H-P” ad campaign (with the amazing picture frames) felt so refreshing.
Dell and others don’t have this option, and need more radical brand measures.