by Shane O'Neill

Microsoft Stores: An Edgier Redmond Is Ready for Retail

Jul 17, 20095 mins
Data Center

Microsoft has transformed itself with smart advertising and new online services, making its retail bid seem less preposterous.

Microsoft is reportedly planning to open some of its retail stores this fall in proximity to existing Apple stores. Let’s get ready to (retail) rumble!!

At Microsoft’s Worldwide Partner Conference in New Orleans, Microsoft Chief Operating Officer Kevin Turner was quoted as saying: “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.”

It’s sort of exciting to know that the Mac vs. PC battle is going from TV ads to the streets. Maybe cash-strapped laptop hunters will take on a group of snarky Apple hipsters in a street fight, like in “West Side Story.” Forget about the Sharks vs. the Jets. It’s the Macs vs. the PCs!

But seriously folks, this Mac/PC division is more of a myth created by advertising. What Microsoft is clearly banking on is not Mac people or PC people but undecided or clueless people, with the hopes that these buyers will leave the Apple Store discouraged (or not go in at all) and walk three doors down to the Microsoft store and buy a cheaper computer. Just like in the commercial!

The timing makes sense for Microsoft. The stores will likely open in conjunction with the release of Windows 7 in late October.

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But it’s hard to say how this strategy will play out for Redmond without knowing what the stores will look like and what they will sell. We don’t know much more about the stores than we did when plans for them were announced in February.

For now, we can only speculate. Will the stores display all the PC makers that run Windows, like Best Buy? Will Microsoft sell its own hardware offerings such as the Xbox 360 and the Zune MP3 player? Will there be in-store showcases displaying the Windows Live Online Services and how Microsoft can make all the digital content in your home connected and interoperable, and then sell those products and services? Will the stores do all of the above?

In a blog post in February, I wrote that the Microsoft Stores will struggle and possibly be a big fat failure, but still have a chance at succeeding if Microsoft plays its cards right.

I think Microsoft has been playing its cards right a lot since February. It started to really advertise the value and cost savings of a PC over a Mac and started to define the Windows “experience”. It targeted families with the Rookies TV spots showing cute kids mastering Windows programs, and The Laptop Hunters commercials were a successful bid to remind retail buyers of the value of a PC and just how pricey those MacBooks really are. The Laptop Hunter ads, in particular, seem like a prelude to opening retail stores.

In addition, Microsoft had a market share-boosting release of its search engine Bing, which included an aggressive and funny TV ad campaign.

There’s also a new version of Windows about to arrive in October that has garnered great reviews (it’s called Windows 7 in case you haven’t heard) and a recent confirmation that there will be a Web-based version of Office 2010 that will integrate with the Windows Live online suite. Add it up and Microsoft is actually starting to look like a cutting-edge company that can offer a solid consumer experience. A year ago, there was no defined Windows “experience,” but things have changed.

Don’t get me wrong, opening retail stores near Apple stores could still make Microsoft look foolish. Everyone knows Microsoft is more a copy cat than an innovator. Opening a cute, little Microsoft store on the same block as a glassy, majestic Apple store will be like putting a Radio Shack next to the Taj Mahal. It will only magnify the perception that Microsoft is a follower.

Plus, Apple customers are some of the most loyal (and brainwashed in my humble opinion) in the world. They go to the store knowing they want Apple products. It’s premeditated. No true member of the Apple armada is going to suddenly change philosophies and stroll down the street and give Microsoft a try.

But there are enough people out there who are not married to a brand, who don’t obsess over this stuff. In effect, the laptop hunters of the world.

Through deft advertising and new online services, Microsoft now offers more of an “experience” for consumers than it did six months ago. If Microsoft can reel in the undecided folks with a compelling — and lets not forget affordable — retail experience, then the stores have a chance to hold their own against Apple.

What do you think? Will Microsoft succeed or crash and burn in retail?

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