Describe and evaluate strengths and weaknesses of their distribution approach and make suggestions for

their future development

By Ronan CHARDONNEAU

Company introduction

Microsoft Windows

Product description Distribution channels

• Individual sales W&S• Included with the PC W&S

Recommendations for future developments

Live Search

Service description Distribution channels Weaknesses and Strenghts Recommendations for future developments

Conclusion

Table of contents

Created in 1975 by Paul ALLEN & Bill GATES

In 2008 it is 91,259 employees in 105 countries

Two Main products:

Other products: MSN, Encarta, PC accesories, Xbox

Microsoft Windows

An Operating System(Main software of a PC) Price of Microsoft Windows in the USA:

Distributed individually or included with the PC

Individually distributed You can buy it online at Microsoft stores or

any of their online distributors You can buy it at a physical store(computer

store, supermarket) You can use it at different places without

buying it for e.g: universities You can receive it from a Microsoft

donation

Weaknesses

Piracy:

244 copies sold in two weeks

in China A cost:

Low demand but have to provide this solution

Donation is not a short term strategy

Strenghts

Piracy:

“let them pirate software developed by Microsoft -that increases the

overall number of Microsoft software users and some of them may

eventually convert into paying customers.”

You get some market shares rather than profit

You can even beat your competitor(Linux requires more discs in

some cases)

A better image;

A Microsoft dependency

Included with the PC

Distribution channels are then the same as the ones of a PC

Bundling:from http://www.investorwords.com/620/bundling.html

« The practice of joining related products together for the purpose of selling them as a

single unit. »

Illegal in most of the countries

Weaknesses

Under the threat of a huge trial (March 2004, the EU ordered Microsoft to pay €497 million)

Introduction of new competitors & low cost products:

Less profit on those products for e.g Windows XP on eee pc at 49€

Customer behaviour can drastically change

Strenghts

If Microsoft closed, the economical impact will be terrible;

Microsoft is almost unmovable, even if not preinstalled, customers are requiring it;

Some countries even authorized bundling(case of China) to face Piracy;

Customers are ignorant and mentality are hard to change;

Recommandations

Hard to recommand Microsoft something Build an image such as setting up a « we are

the good guys » policy by being more present in people's life(offering more products, training in public places)

Live Search

Microsoft Search engine A recent technology for Microsoft(2004) Google(1998), Yahoo(1994), Baidu(2000) How Live Search can be so successful?

Leading the market in only four countries: Colombia, Honduras,Rep. Dom, Angola

Distribution Channels

Through Internet, the user is then free; Software, for e.g: Java, the user can be

locked; Hardware, the user can be locked; Web applications, for e.g: Facebook, the user

is locked; His own products and services, for e.g:

hotmail, the user is locked;

Weaknesses

A bad product(more resquests made from MSN rather than on Live Search itself)

Give a bad image of the company Increase the unsatisfaction

Strenghts

Through those techniques Microsoft can overcome some barriers that its competitors cannot such as nationalism

To use those channels you need high capital and to have a large range of products and services

They invest too much time in setting up good distribution strategies but what will happen if the customer discover the situation(being locked and using a bad product);

Microsoft should think about improving the quality of his technology in this field

Think too much about marketing(changing the layout, changing the name... « Kumo »)

Recommandations

Conclusion

“Bill Gates was not a computer wizard but a genius of marketing.”

“I do not think that a company such as Microsoft

Thinks about going bankrupt”

Their distribution channels are until now unbeatable

They should however as a security take care about their image, in the field of technology threats can happen at any

time

THANK YOU FOR YOUR ATTENTION