February 1, 2001
Advertising
Microsoft's New Ad Campaign
Shifts Focus to Pocket PC Devices
By PUI-WING TAM
Staff Reporter of THE WALL STREET JOURNAL
In a new advertising campaign starting Thursday, Microsoft's
mobile-devices division is aiming to take the high road.
Ten months ago, the Redmond, Wash., software company unveiled an
updated version of its Pocket PC hand-held computing platform and
released a blitz of ads that took aim at rival hand-held device maker Palm.
At the time, Microsoft's ads boldly asked, "Can your Palm do that?" --
referring to embedded functions of Pocket PC devices such as
spreadsheet capability and MP3 digital music playing. Microsoft followed
up the promotional onslaught by criticizing Palm's devices as too limited.
Now Microsoft is shifting its strategy. In its new $3 million-plus ad
campaign, the software concern is abandoning its "Can your Palm do
that?" tagline and purging its ads of all references to Palm. Instead,
Microsoft's mobile-devices division is moving to stand on its own with a
series of ads that highlight Pocket PC devices being used in different
wireless scenarios, such as sending a wireless e-mail.
"It's time now for the Pocket PC to establish itself on its own," says Phil
Holden, marketing director of Microsoft's mobile-devices division. "Our
'Can your Palm do that?' campaign suggested that the Pocket PC and
Palms were similar. Now we're going to stand on what the Pocket PC can
do and not what the Palms can't do."
According to
market research
firm NPD Intelect,
Port Washington,
N.Y., Palm's
devices had a
72.1% market share
in 2000. Devices
from Handspring,
which are based on
the Palm operating
system, had a
13.9% share.
Meanwhile, devices
based on
Microsoft's Pocket
PC platform,
including Compaq's iPaq and Hewlett-Packard's Jornada, had a slightly
more than 10% share of the $1.03 billion U.S. hand-held device market.
Microsoft's new ad message doesn't mean that its continuing battle with
Palm, Santa Clara, Calif., is any less intense. Since Palm introduced its first
device based on its operating system, in 1996, Microsoft has been
struggling to sell a competing hand-held operating system, initially called
Windows CE. While its latest effort -- the Pocket PC platform -- has won
better reviews, Palm remains dominant.
It was Microsoft's coming-from-behind position that spurred its "Can your
Palm do that?" ad campaign, which, for the most part, attracted
unfavorable notices. "No major brand has succeeded by solely playing off
the competition," says Tim Maleeny, director of strategic development at
ad agency Publicis & Hal Riney, a unit of Publicis. "Microsoft's campaign
reinforced the notion that they were late to the game."
Palm executives weren't amused either. Microsoft's early campaign was
"very unbecoming of somebody that powerful," says Satjiv Chahil, Palm's
chief marketing officer. He retaliated with a $500 million world-wide
advertising effort several months ago that doesn't mention the Pocket PC.
In its latest incarnation, Palm's advertising will focus on its wireless Palm
VII device, spotlighting its wireless e-mail and wireless Internet
capabilities. Palm's refreshed campaign will hit print publications, radio
airwaves and the Internet in mid-February, Mr. Chahil says.
Meanwhile, Microsoft's new ad campaign, developed by Seattle agency
Wes Design, will feature black-and-white shots of three smiling Pocket PC
users. In front of each smiling face is a color shot of a Pocket PC device --
along with its color screen -- and the new tagline "Go wireless." Text in
one of the ads spotlighting wireless e-mail reads, "No one needs to know
you're out of the office." Another ad focusing on wireless Internet surfing
reads, "Change where you work, not how you work."
Microsoft's ads also will highlight some of the new partnerships it has
struck with wireless-content and access providers, such as OmniSky and
GoAmerica. "Sign up for OmniSky service, and you can access the
Internet in rich color when you're on the go," reads one of the ads.
Microsoft's Mr. Holden says the ads initially will appear in national daily
newspapers, such as The Wall Street Journal and USA Today, as well as
in more than a dozen technology-oriented magazines, such as PC
Magazine and Business 2.0. The campaign is expected to run for the next
four to five months. Microsoft also will revamp its Pocket PC Web site.
"It'll be interesting to see what Palm thinks of this new ad campaign," says
Mr. Holden, in a parting shot. "One of my favorite hobbies is to bait them."
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