Microsoft Lumia - Situational Recap + Marketing Mix

4.1 Situational Recap

The Microsoft Lumia has a broad price range. The Lumia 550 and 650 are the budget range, and the Lumia 950 is the top-tier model. The Lumia 950 is loaded with Windows 10 operating system, 20MP camera and a device-pairing function called Continuum. Continuum can turn the Lumia into a desktop, and when paired with the increasing trend of cloud storage subscriptions, is beneficial to the portable lifestyle of the modern consumer. The Lumia 950 also comes with a unique system called Windows Hello, which scans your iris as a password substitute. An aspect like this is part of Microsoft’s unique selling proposition regarding the product. Statistics vary, but it is said between 79-89% of Australians own a smartphone, and 8% of that figure are using Windows phones. This can be considered an opportunity for Microsoft since it is projected that with each year more Australian’s will buy a smartphone. Microsoft’s two main competitors are Apple and Samsung, who collectively control 73% of the market share. Other lesser known competitors include Chinese brands Huawei and Xiaomi.

4.2 Marketing Mix

Product Lumia is a smartphone Unique operating system, Windows 10	Promotion Point-of-sales through retailers Advertising Social media
Price Affordable budget models – Lumia 550 and 650 High priced model – Lumia 950 and 950XL	Place Social media Online and magazine reviews Mobile phone retailers

4.3 SWOT

Strengths Strong grasp over businesses and educational institutions Windows is the primary operating system taught in schools Windows holds the majority of the market share for the most popular desktop operating system	Opportunities Appealing to a younger demographic, targeting ages 18-44 Point-of-sales commissions schemes to encourage retailers Emphasis on new features and use of own operating system Emphasis on interconnectivity via the Windows 10 OS. Appeal to price-sensitive consumers
Weaknesses Significantly low number of Windows            phone users in comparison to Google            Android and Apple’s iOS. Weak innovativeness in the smartphone field, not attracting customers.	Threats Losing more market share to competitors (Apple and Samsung) Competitors copying and potentially expanding on Microsoft’s ideas Negative reviews and press regarding the Lumia smartphone range

Integrated Marketing Communication Strategies

The most important part of integrated marketing communication for Canary Jane’s Flowers is the communication between customers and employees. As shown in Figure 9.1 this form of communication is considered interactive marketing on the triangle and relates to delivering the promise. Canary Jane’s promise is to give customers the freshest flowers that are locally sourced and deliver exceptional service, their interactive communications plays an important role in creating consistent service to deliver this promise. Since Ms. Stacey doesn't have an advertising agent, she relies mainly on this form of communication to promote the business. She focuses more in delivering an excellent service in order to gain a good reputation and customer retention. This is evident by the review comments that have been uploaded by the customers, who have dealt with Canary Jane’s Flowers.

Interactive marketing involves having skilful and qualified frontline employees that understand what each customer requires. Canary Jane’s Flowers once had a customer who wanted to give his girlfriend a yellow flowers for Valentine's Day, the staff explained to him that yellow flowers symbolise friendship and suggested a different colour, the customer was impressed by their knowledge and went along with their suggestion. This illustrates that the staff intend to understand the customer's needs and offer the best service.

Interactive channels must be integrated to create consistent service promises. As part of advertising strategy Canary Jane’s Flowers uses social media such as Facebook. Their Facebook page is very interactive and up to date with lots of colourful pictures to appeal to the market. Canary Jane's Flowers was also featured in Frankie magazine, which is another form of unpaid advertising for the business. This proves that the staff are very active and consistent with the service provided.

Horizontal communication, also identified as lateral communication, is the passing of messages between entities and groups on the same level of an organization (Zeithaml, Bitner & Gremler 2013, p.434). Horizontal communication assists in the production of high quality exchange because it happens directly between people in the same environment, therefore it is also more efficient. Floristry is an artistry profession and fully depends on what the customers desires. Since there is only a small team of three at Canary Jane’s Flowers, horizontal communications is more significant and suitable. On the other hand, where there is an open channel between sales and operations things are more complicated (Zeithaml, Bitner & Gremler 2013, p.434). This is why Canary Jane’s Flowers communicate information through various strategies. For instance, horizontally; there is a system where all the staff uses to check for updates and also the orders. Vertically; in situations where there is a matter that requires the owner’s permission for decision making, such as a price change, then the information is sent to Ms. Stacey's email address. In addition, the rules, policies, procedures and regulations are all passed down from Ms. Stacey to all the staff members causing a downward flow of information. The communication returns upwards with the end of the day performance reports, complaints, feedback, etc. Communication can be difficult if employees do not effectively fulfill their roles.

References:

Zeithaml, V, Bitner, M & Gremler, D 2013, Services marketing, McGraw-Hill Irwin, New York.

Microsoft Lumia - Stakeholder Analysis, Competitor analysis & Critical success factors for the industry

Stakeholder Analysis

To understand Microsoft’s vast stakeholder’s list we need to understand their mission when they first became a company. ‘To have a computer on every desktop in every home’. The enormity of this goal was the reason why Microsoft became so big. Everyone I know has used their software or typed in Word. It’s just a fact that Microsoft has a very large stakeholder base.

Microsoft sell distribute software through OEMs that pre-install our software on new PCs, servers, smartphones, and other intelligent devices that they sell to end customers. Some of the OEM’s include Acer, ASUSTek, Dell, Fujitsu, HTC, Hewlett-Packard, LG, Lenovo, NEC, Nokia, Samsung, Sony, and Toshiba. (Annual Report, 2011). “Many organisations that license our products and services through enterprise agreements transact directly with us, with sales support from solution integrators, independent software vendors, web agencies, and developers that advice organisations on licensing our products and services ("Enterprise Software Advisors"). Some of our distributors include Ingram Micro and Tech Data, and some of our largest resellers include CDW, Dell, Insight Enterprises, and Software House International. Our Microsoft Dynamics software offerings are licensed to enterprises through a global network of channel partners providing vertical solutions and specialised services. We distribute our retail packaged products primarily through independent non-exclusive distributors, authorized replicators, resellers, and retail outlets. Individual consumers obtain these products primarily through retail outlets, such as Wal-Mart and Dixons” (Annual Report, 2011).

Competitor analysis

Microsoft has many competitors, namely two big ones. Apple and Samsung. Together they have dominated the smartphone market and do not show any signs of giving up. ‘’With fierce competition in the electronics industry, Microsoft’s mobile is facing every kind of problems in development, smart-phone’s challenged from Apple and Google, also there has problems with products, research and development, marketing strategy and enterprise development strategy. Microsoft needs to plan its strategy as a “universal key” to open each locks’’ (Microsoft Corporation’s Strategy, 2015). As I mentioned before “iOS and Android, comprised 15.8% and 81% of the smartphone software market share, respectively. (‘Another Painful Reminder of Microsoft's Bungled Nokia Acquisition’ 2016). Microsoft is already at a disadvantage because of this overwhelming market dominance, and by replacing the android OS with their own windows operating system they have eliminated all the popular applications that would otherwise be fund on iOS and Android systems. “The Index revealed that 62 percent of active smartphone users have used their phone to replace other technology products including their digital camera and GPS navigation system, as well as games, the morning newspaper, photo album, letter box, catalogues and banking” (82% of Australian smartphone users are never without it, 2015).  Microsoft have limited applications on their software and have ditched Googles GPS or Maps application altogether as well as Androids contactless payment system. Apple has already implemented this into their devices so Microsoft is way behind the eight ball and need to consider some new ideas in order to gain more competitive advantage.

Critical success factors for the industry

To under the success of Microsoft we need to understand the organisation on all platforms. “In an interview with International Business Times in July 2013, Nokia vice president Bryan Biniak urged Microsoft to fix the various platform issues, such as the lack of certain key applications: "It's not just about the hardware, it's about the tools that are on the hardware. You can't sell a phone The Microsoft-Nokia Strategic Alliance Page 14 without the apps, you just can't." (Gilbert, 2013). Biniak explains that Microsoft needs not only to innovate as they have done with the continuum and other features they have added to the Lumia but also to compete with what customers want, and what they want is applications. It’s no secret that the success or failure of a product comes from brand image, price and advertising/marketing. However, there are some real key Pro’s for Microsoft in-terms of brand-image and price. They have a great looking phone that can do some really interesting and standalone stuff. However, no one really knows about it. The success doesn’t come from the advertisement of the product. “Seventy-two per cent of shoppers said they were already aware of the product they wanted to purchase in-store through their own research, rather than through advertising” (Harper, 2015). So where does Microsoft fall short? “Many have experienced the same situations as I have where you have to explicitly ask for a Windows Phone when you visit a carrier store. Windows Phones are not on display anywhere. The devices sit on shelves in the backroom, gathering dust. Just like the Microsoft Band at Best Buy, to the normal shopper Windows Phone just doesn’t exist, either. Salespeople at carrier stores have said, "No one wants them, no one is buying and they don't have any apps" (Trent, 2015). And how does Microsoft succeed in gaining market share? Well that can answered in many ways. However, I have one proposition, keep selling in bulk to businesses but tailor to an everyday customer’s needs. If Microsoft work on making the phone more consumer friendly with built in GPS and online banking Apps then people might start to consider the Lumia as an actual alternative to Apple or Samsung. Also Microsoft should consider investing in marketing to help push the products brand image so that salesmen at stores aren’t dismissing the product as an actual piece of garage. 

References:

Trent, R 2015, ‘Microsoft Band Retail Channel Suffers from Windows Phone-it is?’, Super Site for Windows, http://winsupersite.com/microsoft-band/microsoft-band-retail-channel-suffers-windows-phone-itis

Harper, J 2015, ‘Smart shoppers: online and mobile’, GoldCoast, p. 65-93.

GILBERT, D 2013, ‘Nokia: Microsoft Must Evolve to Make Windows Phone a Success’, International Business Times http://www.ibtimes.co.uk/nokia-microsoft-needs-evolve-windows-phone-succeed-494885.

‘Microsoft Corporation’s Strategy’ 2015, http://studymoose.com/microsoft-corporations-strategy-essay.

2011 Annual Report, ‘Distribution, Sales and Marketing 2011’, Financial Review, Microsoft Corporation.

‘Another Painful Reminder of Microsoft's Bungled Nokia Acquisition’ 2016 Emirates News Agency, p. 11-179.

82% of Australian smartphone users are never without it, 2015, Telecompaper Asia, 15-93.

Microsoft Lumia - SWOT Analysis by Mitchell Formica

Strengths

Microsoft is world leader of software development, holding the title as the world’s biggest supplier of computer software. “According to Steve Ballmer Microsoft Chief Executive (2013), Microsoft’s Windows occupy 91.49% sharing of the global PC operation system. Nokia has had powerful hardware design concept and abilities of manufacturing, also Nokia’s Lumia occupied approximately 82% of the market. So, acquisition of Nokia was a great record for Microsoft’s corporate strategy”.  (Microsoft Corporation’s Strategy, 2015).  See Appendix 1.1 for further details.

Weakness

Microsoft jumped into a market that was already occupied by two other large scale organisations with considerable market share. At the time most of the market shares have been taken by Apple and Android. “According to Bamburic (2013), in 2013, Window Mobile only occupied 2.9 % from the smart-phone market share, it is a bad record which compare with Apple’s 18.2 % and Android’s 74.4 %. (Bamburic, 2013).  See Appendix 1.1 for further details. Another weakness for Microsoft is that it is considerably hard to get people to change from an already existing phone with OS to a totally different format. Although everyone is most likely familiar with windows operating system it’s still not the norm to be using it on a mobile device and therefore makes for a harder substitute change option from the consumer’s point of view.

Opportunities

Following on from some weaknesses there are some opportunities for Microsoft. Whilst Android occupies a large amount of the market the loyalty from android users is considered unstable and can shift. Apple on the other hand are too expensive for some consumers offering no value option at the Lumia and Galaxy S7 level. “Window mobiles get a chance to attract those customers. Functional With the developing Information Technology, people see mobile as a necessity, and mobile phone is not just a communication tool, consumers concern about the multi-function and the brand of mobile phone” (Microsoft Corporation’s Strategy, 2015).  

Threats

Lastly we have some threats. Obviously we look to the competitors Apple and Samsung and even Google as they own Android. HTC is also a small competitor but a competitor none the less. They all are trying to gain market share and will therefore try to innovate work on new ideas and market their own brands tirelessly. See Appendix 1.1 for further details.

References:

Bamburic, M. (2013). What we know about Windows Phone 8.1 so far? [Online] Available From:http://support.techlogic.net/index.php?/News/List/Index/134. [Accessed: 28th February 2014].

‘Microsoft Corporation’s Strategy’ 2015, http://studymoose.com/microsoft-corporations-strategy-essay.