In navigating the tricky waters of the post-PC world, Microsoft is trying to make up ever-dwindling revenues from traditional businesses like Windows, Office and Server with new subscription services and mobile offerings. But it’s become increasingly clear that in doing so, Microsoft may also need to leave those brands behind. Which is fine, since Microsoft has a final brand card to play that matters more than Windows, Office and Server combined.
What is this incredible brand, you ask?
It’s the Microsoft brand, of course.
During a recent appearance at Convergence 2014, Microsoft Chief Marketing Officer Chris Capossela tackled the problems facing the software giant head-on. I wrote about part of his keynote in Microsoft’s New Strategy for Office: Freemium. But here I’d like to examine something that is perhaps even more explosive: Microsoft is willing to drop the very core of what defined the company over the past few decades. And in doing so, it may emerge with the only brand that really matters.
This is a contentious, hot-button topic right now because some of Microsoft’s biggest proponents have grown leery of its ongoing efforts to support competing platforms like Android and iOS (iPhone, iPad) over Windows. Indeed, since Satya Nadella took over as CEO a bit over a year ago, Microsoft has delivered far more—and far more compelling—mobile apps on the competition than it has on its own Windows-based platforms. Why would one even continue using Windows or Windows Phone when Microsoft’s productivity offers are so strong on more popular mobile systems?
These critics are missing the point, Mr. Capossela explained at Convergence. And as demonstrated by the “mobile first, cloud first” mantra at Microsoft, there are two halves to this puzzle.
On the mobile end, users aren’t just buying certain devices, they’re opting in to ecosystems. And if Microsoft’s ecosystems aren’t available on the popular mobile platforms, they’ve die right alongside Windows. So it makes sense for Microsoft to go where the users are and establish itself as the productivity ecosystem of choice.
On the cloud services side, businesses aren’t looking for a single product that can help them move to cloud- and hybrid-cloud infrastructures, they’re looking for a single partner. Here, the picture is clearer, as Microsoft is the obvious trusted partner to make this happen, compared to less trusted alternatives like Amazon or Google. So its push with Azure, Office 365 and other cloud service platforms is well-done.
If there’s one thing that both have in common, however, it’s Microsoft, and not “Windows,” or “Office” or any other specific product brand. And while this is different from the past, where Microsoft did indeed “favoring product brands over company brands,” it makes sense in today’s world.
“While Windows is a strong brand and Office is a strong brand, the Microsoft brand is actually the strongest one we have,” he said. “It’s typically top five in every brand survey that’s been done in recent years. And we also see the trend of the brand is very good [and is on the way up] with consumers. It’s [even] stronger with commercial customers.”
As a test of its brand, Microsoft redesigned its corporate logo over two years ago, adopting a square design that was first used for Microsoft Store and somewhat mimics the Windows logo. Already, over 65 percent of consumers identify just that logo with Microsoft, Capossela said, which is an astonishing rate of brand recognition. And it’s got close to 90 percent brand recognition with businesses. “The brand is just quite strong,” he said.
This kind of branding isn’t just an exercise: the performance of Microsoft’s brand will continue driving the identity of its products going forward. Windows Azure, for example, was renamed to Microsoft Azure for this very reason, and Capossela noted that the browser currently codenamed “Project Spartan” rates mostly highly when Microsoft tests final names with the word “Microsoft” in the title.
You also see this new Microsoft logo—with no Microsoft name—on other new products. Microsoft Band has a subtle Microsoft logo on its clasp, and the Surface Hub likewise only has a Microsoft logo on it, with no accompanying Microsoft name or Surface Hub branding. The new Windows Phones Microsoft will ship this year will have that symbol on the back as well, Capossela noted.
For those who bemoan the loss of the Windows/Office/Server past, you can at least take comfort in Microsoft returning to its roots as a provider of software that works on the most popular platforms. And through efforts like the deals to preinstall its mobile apps on Samsung and other Android devices, or simply by supporting iPhone with Office and other apps, Microsoft is becoming a key part of these platforms, even though it doesn’t make them itself. No one uses Windows for Windows’ sake, after all; they’re there for the apps.
Ultimately, the Microsoft brand “stands for this notion of empowerment,” as Capossela puts it. That’s a great message, one that is more easily digested than “mobile first, cloud first,” and one that doesn’t beg for a nuanced reading.