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Brand Winners... And Losers: Apple and Microsoft
Brand Winners… | And Losers |
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The Marketing Doctor says:
Winner: Apple
Loser: Microsoft
Folks, rarely do I get the chance to showcase one of my favorite brands and one of my least favorite brands in a single winner/loser post. But earnings season has just shown in very stark terms why real marketing matters. Apple has emerged ahead despite the economy; Microsoft is losing business and letting employees go.
The Winner:
Apple. The company just reported record earnings and has triumphed in an economy that has been savaging almost everyone in the tech and retail sectors. Here’s a quote from the CNET article:
For the three-month period ended December 27, Apple recorded $10.2 billion in revenue, as compared with $9.6 billion a year ago, and net income of $1.6 billion, as compared with $1.58 billion a year ago. That translates into earnings per share of $1.78…
Analysts had expected $1.39. Fuggedaboutit.
Apple is a company that knows its brand, and it also knows real marketing. It delivers products that its Target Market wants. Rather than repeat myself about this brand’s virtues and why it works so well, see my posts here and here.
One hiccup in this week’s winning performance is the ongoing Steve Jobs health issue. This is something that I blogged about some time ago in this space (see that post here) because the company’s handling of this issue was a poor choice for the brand.
Now, unfortunately, the SEC is looking into whether there should have been more disclosure about Jobs’ health. I have tremendous respect for Jobs, but even the best can blindside themselves. Still, I believe Jobs has now addressed the health issue with his planned leave of absence, and Apple will probably sail through the SEC scrutiny and keep doing what it does best.
The Loser:
Microsoft.
Sure enough, Microsoft’s poor marketing has finally caught up with the behemoth.
The “build it and they will come” business model has finally faltered. The company announced earnings problems and layoffs. See that article here.
Again, for a deeper look at why Microsoft’s the loser, please take a gander at my posts on this problem brand: here, here, here, and here. To sum it up: because Microsoft has had such a dominant market position for so long, and because of the way it evolved, the company does not have real marketing in its bones.
Like the auto industry, another collection of unresponsive monoliths (see posts on GM and co. here and here), once bad times strike or genuine competition gains a foothold, the only thing a company like Microsoft can do is to shrink.
Unless Microsoft discovers real marketing, that shrinking will eventually lead to obsoletion, no matter how big it is right now or how dominant it has been in the past.
If only the folks at Microsoft could understand that their fortune will change the moment they really begin to think about their customers and begin to design the products that we actually want, rather than products that egocentric, out-of-touch executives think we want. Stay tuned.
Bottom line: if this week’s winner and loser don’t show how a muscular, adaptive and compulsively responsive habit of reaching customers and meeting their needs is central to business success, I don’t know what will.
And remember, it’s always easier when you keep marketing and branding in mind.
TODAY'S TANTILLO TAKEAWAY -
Even in the most hostile economies, real marketing can mean the difference between profit and loss.
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