Microsoft: We're Going to Keep Running Apple, and Running Them and Running Them

All is fair in love, war and marketing smackdowns. At the Worldwide Partner Conference 2009, in New Orleans on July 15, 2009, Microsoft’s Kevin Turner, chief operating officer, revealed that the Redmond company had managed to hurt Apple since the fall of 2008, and that more hurt was on the way. In an extremely emphatic speech, Turner reached an apex with a promise that managed to turn into a pseudo-mantra, a commitment to “keep running Apple, and running them and running them.” For Microsoft it all started when it renounced being a passive player in Apple's Get a Mac advertising videos, and came out gunning at the Cupertino-based hardware company with its own breed of marketing, embracing the idea of “being a PC.”

“Now let's talk about Apple,” Turner said during his keynote address. “What are you going to do about those Apple ads? That was a year ago. Gosh, when I went home for the holidays, brothers, sisters, cousins – hey, hope you don't have anything to do with marketing over there at Microsoft. What are you guys going to do about those Apple ads? Stay tuned, stay tuned, stay tuned. Wow. Did we punch right back? The PC Hunter ads, the PC Rookie ads clearly have been winners in the marketplace.”

But it's not a boxing match, there are no knockouts; instead it is a continuous face-off with erosion signs visible in time. Still, according to BrandIndex, Microsoft has been gaining value perception since the introduction of the ‘I'm a PC’ marketing effort, which, directly targeted at Apple, caused the rival to lose value perception.

As an integral part of the marketing campaign, Microsoft debuted a series of video ads labeled Laptop Hunters. In Laptop Hunters the protagonists are given money, usually under $1,000, and told to go buy a PC, and to keep it provided that it is no more than the sum awarded. The buyers featured on the Laptop hunters ads make it a point to take a shot at Mac computers for their prohibitive prices compared to Windows machines. Microsoft says it's working.

“And you know why I know they're working? Because two weeks ago we got a call from the Apple legal department saying, hey – this is a true story – saying, "Hey, you need to stop running those ads, we lowered our prices." They took like $100 off or something. It was the greatest single phone call in the history that I've ever taken in business,” Turner revealed (Applause). “I did cartwheels down the hallway. At first I said, "Is this a joke? Who are you?" Not understanding what an opportunity. And so we're just going to keep running them and running them and running them.”

While losing value perception, Apple has also sold less Mac computers. According to IDC, Apple has slipped into fifth place in terms of computer shipments in the US, losing the forth position to Toshiba, a Windows-PC vendor. Apple experienced a drop in Mac units sold by 12.4% and a market share dip from 8.5% to 7.6% for the second quarter of 2009 compared to the same period of 2008.

Microsoft confirmed that it would debut its retail store strategy in the fall of 2009, yet another chance to jump at Apple's jugular. In this regard, Turner noted that some of the Windows shops that would be opened would be in locations vis-à-vis of Apple stores.

“And we're going to showcase this opportunity of Windows simplicity, choice, value, and partners. And stay tuned, because we're going to have some retail stores opened up that are opened up right next door to Apple stores this fall. Stay tuned, just stay tuned,” Turner said. “Every single thing we learn in those Microsoft stores that we put on the street we're going to share that openly and transparently with all of our retail partners so that they can do the exact same thing. And we're going to get that customer feedback directly. We're in the game for the long-term here. And I know something about retail, and we've hired and incredible team to do an incredible job on retail.”