Microsoft's Rumored Job Cuts To Pay For Branding Failures? - InformationWeek

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Infrastructure // PC & Servers
07:01 AM

Microsoft's Rumored Job Cuts To Pay For Branding Failures?

Microsoft may be the next technology brand to announce layoffs "due to the terrible economy." I'd suggest its terrible branding is at least partly to blame.

Microsoft may be the next technology brand to announce layoffs "due to the terrible economy." I'd suggest its terrible branding is at least partly to blame.Everybody recognizes the Microsoft brand. Its OS loads with a standard (and trademarked) badda-bing every time millions of people turn on their computers. Its iconic founder, Bill Gates, is not just a leading business personality, but rather a member of that august and small coterie of people who comprise the pantheon of capitalism's myths. The company has enriched numerous employees and stockholders. You can't watch TV, read a magazine, or troll the Internet without tripping over ads or mentions of its software, devices, or games.

So what does Microsoft get for all that recognition? What competitive advantage or benefit arises from its near-ubiquitous brand recognition?

It can't charge more for its stuff, in keeping with the old hopes for premium pricing as a payoff for great branding. In fact, often it charges less, and just as often delivers an actual loss to the company's bottom line (XBox360 game consoles, for example). Apple's OS costs more, doesn't it? Worse, lots of competitors give away comparable software for free, whether Google docs, or Mozilla's Firefox browser.

Does Microsoft command more trust because of its brand name? Not particularly. A large number of consumers actually distrust it, or are at least very unforgiving, especially when it comes to the stability of their computers. I wonder ... were lots of consumers willing to go buy Zune players because of their belief that products from Microsoft are dependable and a good value? Not so much.

Actually, what is the Microsoft brand? Sometimes it's a nearly invisible enabling program that runs other people's products (i.e. computers). Other times, it's a gizmo, a set of software programs, a service, an Internet browser, a server application, or what have you. It has spent many hundreds of millions of dollars establishing such complete confusion over its brand.

And now, as a difficult economy challenges its business, it has to consider firing people, because there's absolutely no return from that investment in branding that it can call on to help out. Where do you want to go today doesn't necessarily include going to the store to buy a Microsoft product, and Jerry and Bill deadpanning (or people declaring themselves PCs) hasn't changed that fact.

I'd offer that blaming the economy is a lame excuse for a more serious, systemic problem: Microsoft can't brand itself out of a paper bag.

What am I missing?

Jonathan Salem Baskin writes the Dim Bulb blog and is the author of Branding Only Works On Cattle.

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