In 2006 Microsoft came up with an answer to the Apple iTunes/ iPod MP3 player and product line, and called it the Zune. Zune is the product-line brand name for the Zune portable media players, Zune software, and Zune marketplace services sold by Microsoft, which provides music, video, and podcast downloads. Although the Apple computer company was the first to offer the product and extensive product line, Microsoft clearly followed in the market leaders footsteps and carved their place in this particular niche in the media/entertainment industry.
Using a well put together market strategy, as well as applying some of the basic principles of marketing; Microsoft has established a strong and successful product line. In order to break down and evaluate the marketing plan that was used in launching the Microsoft Zune and its product line, one must first identify the “four P’s” of the product. The Four P’s stand for product, price, placement and promotion. The product in the principles of marketing is described as a “need-satisfying market offering”. Although the Apple iPod was already on the market, it was the only of its kind.
At one point since they were the only company in the industry that made MP3 players, there was no choice and no competition. In other words Apple had the market cornered. Therein was the need, the need to give consumers another option, a less expensive option with just as many if not more features as the Apple iPod. Soon after other companies came up their own version of MP3 player but the Microsoft Zune has held steady as one of the leading suppliers since its debut in late 2006. One of the first major factors that Microsoft had to consider in the development of the product was how to market and price the item so that it ould compete with the other brands of that particular product. Microsoft used several campaigns to promote the Zune, to include the “Music the way it wants to be” and also the major theme “Welcome to the social” which were highly successful in the launch of the new product. When it came to the pricing strategy, Microsoft implemented a combination of “market penetration pricing which set a lower price for the new product in order to attract a large number of buyers and a large market share” (Prin. Of Marketing, P. Kotler, G. Armstrong p. 309) as well as promotional pricing to set the tone and establish the product within the market.
Another approach Microsoft took to generate sales was to make the Zune available outside the U. S. Once Microsoft had established Zune in the U. S. , the company branched out and released the product to Canada and then went on make plans for a European launch which was set to launch this year. The key step when it came to marketing and pricing the item was establishing a target group to focus on during the initial development phase. Once the target group that the company was going to focus on had been established, the next step was to implement how Microsoft was going to make this product available to the target customers.
Along with the campaigns that were initially launched, Microsoft also made an attempt to “viral market” its target customers with the “comingzune” site to try to introduce the product to the public and to key in on the focal group that had been established. Although the placement strategy in my opinion was as aggressive as it could have been. It succeeded in making consumers curious about the Microsoft Zune and its potential. The choice of branding and distribution were part of the Zune as a decision of “two strategies in the market right now: cross-brand ecosystems …. nd singular brand ecosystems…The former are gaining in share and units sold, but the latter has enormous share and won’t give that up easily. ” “Microsoft also wanted to go beyond Apple’s efforts and promote the tagline ‘the social” and Wi-Fi (wireless sharing) as key differentiators.
Chris Stephenson, leader of Zune’s marketing and manager of Global Marketing for the Entertainment Business said, we see a great opportunity to bring together technology and community to allow customers to explore and discover music together. New York Times magazine columnist Rob Walker agrees that the Zune’s “community togetherness seem like a reasonable counterpunch to iPod’s supposed attraction as an individuality enabler that allows owners to wallow in their own tasteful personal soundtracks. ” But he also sees the Zune having gained appeal as an individualistic statement against the omnipresent iPod:”The most salient feature of the Zune seems to be that it’s not an iPod. ” (Wikipedia-Microsoft. ”Microsoft to Put Zune Experience in Consumers’ Hands on Nov. 14”)
When it came to promoting the Zune, Microsoft took a different approach from the Apple iPod and used the Wi-Fi (wireless sharing) as a key differentiator. Because the iPod didn’t initially used this particular step when they developed their product, Microsoft felt that they could use this feature to be somewhat of a “niche” to appeal to the target focal group in mind and attract potential buyers. Chris Stephenson, leader of Zune’s marketing and manager of Global Marketing for the Entertainment Business, said “we see a great opportunity to bring together technology and community to allow consumers to explore and discover music together. So with this approach, the Microsoft developers felt that they had created a counterpunch to the iPod’s attraction of enabling users to create their own personal soundtracks. Microsoft also used the MySpace as an Advertising strategy to promote the product by allowing users to create personal profiles to Zune-themed media, thus expanding their marketing tactics and branching out to a whole different audience.
In my opinion, Microsoft became very successful with the Zune when it allowed user’s to interface the Zune with Microsoft Windows Media Player. If you think about it, Majority of the personal computers are equipped with this feature, so it is much easier for you to go in download music from the media player, as opposed to the apple iPod, where you must first download iTunes and then you will have the capability to download music and other media directly to the product.
So with that being said, the makers of the Zune really found their “niche” when they made the product compatible with the media player. Another key feature of the Zune had to offer was the fact that the product is made by Microsoft which also makes the Xbox video game console, and the system is equipped with a USB port to allow the Zune to plug into the console and display media, download, and play music from the video console using the Zune as a portal.
Those two key features right there allowed Microsoft to catapult directly in competition with the iPod and the other leading MP3 at the time of its launch. In conclusion, the Microsoft Zune has become the direct alternate the Apple iPod. The Microsoft developers took a lot of similarities from the iPod and used them to form a product that would serve as direct competition the MP3 giant and thus continue to keep Microsoft ahead of the curve in the computer technology industry.